What’s your potential for becoming a winning trader or a losing gambler?
When do your cross the line to compulsive trading? Investment psychologist
Van K. Tharp interviews one trader who crossed the line.
By Van K. Tharp, PhD.; pages 11–13.
Volatility how fast and how much prices change is the most important factor
affecting option premiums. This author describes how to apply volatility
calculations and forecasts to different options trading strategies such as
straddle and strangle purchases and ratio writes.
By John Nelson and Stephen Kreis; pages 14–17.
This article begins a column that shows how to use computer spreadsheets
to develop a trading and a historical testing system to evaluate indicators.
By Jim Summers, PhD.; pages 18–19.
A chartist’s view of tracking the Dow prices using cumulative volume.
A four-month period leading up to the market high of January 1987 is analyzed.
By R. Stuart Thomson; pages 20–22.
This article begins a column focusing on the whys and the wherefores of
leading indicators and their performance records. Indicators to be covered
are listed here along with a description of what types of things each indicator
may indicate for the stock market.
By Arthur A. Merrill; page 23.
A fast and easy-to-use analytical tool, with some unique extras, presents
a tempting option for busy traders.
By John Sweeney; page 24.
Objective evaluation and selection of potential advisors can increase your
annual rate of return. This article presents some practical means of determining
the probability of a money manager’s success.
By Charles Milmoe; pages 28–30.
The technician believes that current market prices are related to past prices.
Identifying trends is the most basic, reliable tool a technician has to get
to the heart of market symmetry. A good article for beginners.
By Heidi Schmidt; pages 31–32.
Trading guidelines and indicators for newcomers to the market.
By John Sweeney; page 33.
The market is composed of time, price and volume. CBOT’s new service
to traders, Market Profile, can help a trader judge when a security’s
price diverges from its market value.
By Thomas P. Drinka, PhD; pages 34–36.
Increasing the reliability and accuracy of volume analysis by imposing new
limits and moving price averages.
By John C. Lawlor; pages 27–39.
A special S&C interview with Bob Pelletier of CSI, noted inventor
of the Probable Direction Indicator.
Pages 46–50.
Successful Elliott wave analysis is highly dependent on an individual’s
ability to recognize and identify price patterns. Gann lines and data compression
can help traders to ride the Elliott wave with greater confidence.
By David Lamarr; pages 46–50.
Wave patterns can either indicate trading opportunities or the madness of
the gambling public. Here, sugar is analyzed using methods typically used
by a wave analyst: time cycles, price retracements, trend lines and Gann
angles, channels, detrending price analysis, momentum oscillators, volume
and open interest, and lunar nodes.
By Bryce T. Gilmore; pages 55–58.
In this article, the authors investigate how CBOT’s new trader service
can be used to evaluate trends.
By Thomas P. Drinka, PhD and Robert L. McNutt; pages 59–61.
Should chartists include CBOT’s new night trading session in their
analyses, or can they afford to ignore it?
By Heidi Schmidt; pages 62–64.
How to avoid the computer trader’s ultimate nightmare: data losses
during a system crash.
By John McCormick; pages 65–66.
Volume times price change equals the momentum that drives the market. Learn
how to chart cumulative volume to reveal and confirm price changes.
By John C. Lawlor; pages 67–69.
A close look at this analytical tool designed to exploit option flexibility
produces a good report card by an S&C editor.
By John Sweeney; pages 70–72.
By taking an objective approach and following their teacher’s advice,
teens outperformed top investment advisors.
By Michael Scott; pages 73–74.
J. Welles Wilder Jr.’s Directional Movement Index (DMI) indicator
is explained in preparation for incorporating it into a spreadsheet trading
plan.
By Jim Summers, PhD; pages 75–76.
How to use exponential averaging techniques to smooth data.
By Arthur Merrill; pages 77–78.
Two authors take Joseph Granville’s classic on-balance volume technique
and improve on it by creating a weighted on-balance volume with better market
sensitivity.
By Steven Goldstein and Michael Kahn; pages 79–81.
Learning macro commands is the first step in building a trading system on
Lotus 1-2-3.
By Jim Summers, PhD; page 89.
Learning to effectively use the most popular of these technical tools.
By Heidi Schmidt; pages 90–92.
Knowing your own decision-making skills and behavior under stress may be
the key to investment success.
By Herbert Friedman, PhD; pages 93–96.
How to translate smoothed data into a forecast; how to read the chart.
By Arthur A. Merrill; pages 97–98.
Why the October 1987 stock market tumble provided one of the best profit
opportunities in history.
By Philip Gotthelf; pages 99–101.
This article explains how to analyze price rotations using CBOT daily volume
and auction activity data.
By Thomas P. Drinka, PhD and Robert L. McNutt; pages 102–106.
More analyses to help you identify the trend wave patterns that indicate
trading opportunities.
By Bryce T. Gilmore; pages 107–109.
The pragmatic path of Peter Parsifal following a positively pitiless trading
day in October.
By Stephen Edwards; pages 110–111.
Why curved lines may be better than straight ones in analyzing price trends.
By D.O. Christian Reiger; pages 112–113.
Use the Herrick Payoff Index to incorporate the action of open interest
into your market analysis.
By Thomas A. Aspray; page 115.
A revealing S&C interview with Perry Kaufman, one of the best commodity
futures analysts in the business.
By John Sweeney; pages 123–128.
The October 1987 Crash marked the end of a great “fifth wave” bull
marketbut what does it mean for the future? Elliottician Robert Prechter
delves into history to lay out the theory of the grand supercycle.
By Robert J. Prechter, Jr; pages 129–132.
Auto and serial correlograms can be used to test for significantly significant
relationships between price movements and indicators or between price patterns
and future price movements. to study the relationships in price patterns.
By Clifford J. Sherry, PhD; pages 133–134.
Understanding price movement is the foundation of profitable trading. Both
stock and commodity markets move in only two ways they trend or consolidate.
Learn some basic concepts for tracking price movements within a trend as
well as the key to swing trading.
By Bill McLaren; pages 136–137.
What can you do to avoid the dangers of compulsive trading? An investment
psychologist describes the stages so you can learn to recognize the symptoms.
Then take a 20-question test to find out your compulsiveness rating.
By Van K. Tharp, PhD; pages 138–141.
On-balance volume reflex goes a step beyond OBV by incorporating open interest
into the equation.
By Fred Purifoy; pages 142–144.
In the world of high-tech trading, this classical but often overlooked tool
may solve some basic problems.
By Thomas E. Aspray; pages 145–148.
The real focus of any research should be the reliability of a system during
actual trading, not the level of profits. Presented here are three methods
to help distinguish reliable from unreliable trading strategies : forward
testing, Profit Distribution Charts and Cluster Spotting.
By Steve Kille; pages 149–152.
By programming Lotus to calculate true range, spreadsheet traders can start
building a DMI system.
By Jim Summers; pages 153–156.
Comparing indicators with the market average, using the time-honored correlation
coefficient and chi-square, can help sort out which indicators are truly
worth watching and which simply “got lucky.”
By Arthur A. Merrill; page 157.
Learn how to use relative strength analysis in spread trading between individual
commodities and CRB Index futures.
By J.J. Murphy and D.J. Hirschfeld; pages 166–169.
Confirming Elliott wave counts using the 21-week stochastic improves correlation
of patterns.
By H. Ralph Cripps; pages 170–172.
Coming to grips with the stock market is made easier by using an indicator
composed of stocks that make new highs each week.
By Irving Lehren; page 173–174.
Living in troubled times may be an advantage, because no one panics over
a minor setback like the market crash.
By Charles Bebber; pages 175–177.
Linked histograms provide a quick and accurate picture of what the market
is doing at any given time.
By Robert Pisani; pages 178–182.
For most traders, the October ’87 crash was an incredible shorting
opportunity lost. What signals did we miss?
By Carl Wyman; pages 183–184.
Check out this six-month report on system performances. Systems were tested
and ranked according to their Pessimistic Return on Margin by Futures Truth
Company.
By John Hill; pages 188–191.
Here is a rundown of data vendors and the quality of data they offer. Information
is gathered by Computer Asset Management Company.
By Steven B. Achelis; pages 192–193.
This installment of the series sets the stage for faster data processing
and more efficient indicator calculations.
By Jim Summers; pages 194–195.
The trend of prices is itself an indicator of the future, since trends tend
to continue. It pays to invest in the direction of a trend. But how do you
determine this direction? Here are a few methods: filtered waves, eyeball,
zigzags and support/resistance levels.
By Arthur A. Merrill; pages 196–197.
Debugging the trading range formula makes the difference between trades
and trash in your 1-2-3 system.
By Jim Summers, PhD; pages 205–209.
How to profit by watching the market and bucking the trends, instead of
following those who follow.
By Henry Van Kessel; pages 210–213.
Using public reports on insider trading to analyze trends in the stock market
could put you ahead of the masses.
By Vincent Cosentino; pages 214–217.
Moving averages, A/D oscillators and other indicators are useful for tracking
trends.
By Arthur Merrill; pages 218–219.
Getting back to basics: Moving averages, a mainstay of technical analysis,
is a trading signal and system component as well as the best estimator of
a random variable.
By John Ehlers; pages 220–223.
S&C takes a close look at Technicom’s trading system
with advanced simulation and optimizing capability.
By John Sweeney; page 224.
What works at the top of the market may not be as effective at the bottom.
Which indicators should you be using?
By Thomas Aspray; pages 227–231.
Some BASIC programming can help you evaluate indicators and produce charts
using the old Lotus workhorse.
By John O’Donahue; pages 232–236.
J. Peter Steidlmayer, author of CBOT Market Profile, takes a philosophical
look at life in the commodities game.
By Ellen G. Williams; page 237.
Examining a simple strategy that can help mutual fund traders increase profits
in mutual fund switching.
By Stan Jones; pages 240–243.
Here’s a new indicator using only exponential moving averages, and
the BASIC program to do it yourself.
By John Ehlers; pages 250–252.
Here’s a tried-and-true method of calculating regression lines for
any number of points to define a trend.
By Arthur A. Merrill; page 254.
Trading psychologist Dr. Tharp takes a close-up look at a well-known contrarian
and commodities trader.
By Van K. Tharp, PhD; pages 255–257.
Knowing how volatility acts can give traders an overwhelming advantage in
the options arena. In this article, the author presents three easy-to-use
rules for using volatility when trading options.
By David L. Caplan; pages 259–261.
This statistical study set out to determine if optimization is of any value
in determining optimal parameters and if one re-optimization strategy is
better than the next. The unexpected results are that no significant difference
exists between any of the strategies’ mean returns, including the random
one.
By Louis P. Lukac & B. Wade Brorsen; pages 262–264.
An age-old doubling system can improve profits in commodity trades.
By Robert Pelletier; pages 265–267.
Manipulate the macros to develop a program loop that manages calculation
of the DMI trading ranges on Lotus.
By Jim Summers, PhD; pages 268–271.
This package takes the concept of formula-generating analytical software
to the limit in PC-based systems.
By John Sweeney & Steve Notis; page 272.
Another view of J. Welles Wilder’s basic book on “making profits
trading...anywhere in the world.”
By Lesley Orr; page 275.
S&C talks trades and trading systems with Lou Mendelsohn, one
of the leading vendors in the business.
By John Sweeney; pages 278–281.
While it is not a forecasting method, this new timing device can provide
advance warning of market disaster. A time series analysis technique, its
function is to analyze the rate of change from the current condition.
By Ichu Cheng; pages 285–290.
What does it take to “get in shape” to become a consistent winner?
Self-confidence, a positive attitude, good concentration, commitment and
stress control. Follow this exercise in self-examination to find your weak
links.
By Neil Weintraub and Susan Arenson; pages 291–293.
Adding a new twist to convergence/divergence, this author finds it more
effective than other indicators.
By Thomas Aspray; pages 294–297.
How to determine when to take a contrary opinion position.
By R. Earl Hadady; pages 298–300.
Why simplicity and common sense are the basics of effective analysis. This
article describes different trading methods, including a technique of defining
the probability of continued price-trend direction by counting the frequency
of movements of different sizes.
By Kent Calhoun; pages 301–306.
Every market action has an equal and opposite reaction, and this can be
charted to show market entry points.
By Ron Jaenisch; pages 307–308.
For readers who have built their Lotus trading systems, it’s time
to try the Directional Movement Index.
By Jim Summers, PhD; pages 309–312.
A review of Stanley Kroll’s latest book on trading.
By Alexander Elder; page 313.
When a straight line doesn’t fit the data, the curved trendline can
be a more useful tool.
By Arthur A. Merrill; page 314.
Trade facilitation tables are used as a way to locate a quantifiable, measurable
way of determining levels of trade facilitation factors.
By Donald L. Jones; page 318–321.
The ABCs of astrological analysis demystifies planetary influences on the
markets.
By Bill Meridian; pages 324–327.
Point and figure chart patterns are used to plot price fluctuations on an
intraday basis.
By John W. Labuszewski and John E. Nyhoff; pages 328–329.
Set your goals and manage stress for better personal performance.
By Susan Arenson and Neal Weintraub; pages 330–332.
Don’t make the same mistakes that burned out other day traders! Here’s
technical and personal insight into what really works.
By Kent Calhoun; pages 333–336.
Author Crabel lays out the nitty-gritty details of a daily trading strategy
based on opening range calculations.
By Toby Crabel; pages 337–339.
Is it stationary, random or independent? The answer may affect you choice
of trading system.
By Cliff Sherry, PhD; pages 340–345.
MACD studies can be used to analyze daily data. Three step-by-step examples
show you how to incorporate MACD-Mo and MACD-H in your analyses.
By Thomas Aspray; pages 346–349.
Program the final Lotus 1-2-3 calculations for the complete Directional
Movement Index system.
By Jim Summers, PhD; pages 350–353.
Refining this traditional indicator gives more timely bullish/bearish stock
market signals.
By Arthur A. Merrill; page 354.
A fear of success and the desire for accomplishment resolve themselves in
one trader’s life.
By Van K. Tharp, PhD; pages 358–361.
Smart money management demands that you know the difference between risk
and exposure.
By Philip Gotthelf; pages 363–365.
How to get in on the action as it first unfolds and get out quickly if the
market moves against you.
By Toby Crabel; pages 366–368.
This recurring cycle made its mark in 1987 and is due again next year. Is
another decline around the corner?
By Gertrude Shirk; pages 369–371.
Here, at last, the differences in options models are explained.
By John W. Labuszewski and John E. Nyhoff; pages 372–376.
An innovative view of traditional market data brings to light new insights
into the relationships of time, price and volume.
By Robert Pisani; pages 377–380.
Generate computerized trading signals from 12 familiar indicators.
By John Sweeney; page 381.
Work step-by-step through the chart analysis of seven indicators at stock
market tops.
By Thomas Aspray; page 385.
This indicator is a measure of expensiveness that signaled the October 1987
crash.
By Arthur A. Merrill; page 389.
Lotus 1-2-3 tells you on screen when your trading parameters have been hit.
By Jim Summers, PhD ; pages 390–394.
Classic techniques are teetering on extinction if we forget the founders
of technical analysis.
By James Alphier; page 395.
Words of advice from a futures speculator who’s been there.
By Raymond J. Kaider; pages 405–407.
Beat the stock market averages with indicators designed for industry groups.
By Richard K. Carlin, PhD; pages 408–410.
How to exorcise the internal conflicts that hinder trading success.
By Van K. Tharp, PhD; pages 411–414.
How regular, repeating cycles affect the stock market.
By Arthur Merrill; page 415.
The Titanic Syndromehow stock market data warns of the “icebergs” lying
in wait for stock traders.
By Bill Ohama; pages 416–421.
A step-by-step procedure for evaluation data in CBOT’s daily market
reports.
By Donald L. Jones; pages 422–424.
Pick under- and overvalued options with software.
By Steve Barr; pages 425–428.
When intraday markets changeand how to trade them.
By Kent Calhoun; pages 429–431.
Speed up Lotus 1-2-3 with faster macros.
By A.O.T. Fayiga; pages 432–433.
Systems? Systems! Let’s talk systems. A humorous look at one trader’s
quest for success.
By Ann Marie Wilson; pages 434–435.
Can the exchanges cope with trading technology and market manipulation?
By Robert A. Wood; pages 443-447.
The way prices move may be more important than how much they move.
By Joanne Hill, PhD and Matthew Celebuski; pages 457–461.
Futures markets reveal their typical Profile patterns in this analysis of
38 contracts.
By Thomas Drinka, Stephen Ptasienski and Robby Humes; pages 448–450.
Program Wilder’s DMI rules into Lotus 1-2-3.
By Jim Summers; pages 451–456.