Predict Market Swings With Technical Analysis

Contents......Page 8
THE BEGINNING......Page 10
How to Start?......Page 11
Earnings Didn  t Seem to Work......Page 13
Technical Analysis Did Seem to Work......Page 14
THE MARKET THAT LIES AHEAD......Page 15
Paradox 2: How Can the Tail Wag the Dog?......Page 16
Paradox 4: One Million Investors Are Usually Wrong.......Page 17
A NEW MARKET PARADIGM......Page 18
A Trading Range Market......Page 19
Market Timing versus Buy and Hold......Page 20
Isn  t Everyone Really a Market Timer?......Page 22
Why Buy and Hold Is Hard to Apply......Page 23
Holding to an Investment Viewpoint or Position......Page 25
The Baby Boomer Misconception......Page 27
Do Insiders Control the Market?......Page 30
Daniel Drew, Robber Baron......Page 31
WHAT  S COMING NEXT?......Page 32
SOLVING THE BIG THEORETICAL PROBLEM......Page 34
The Old Model......Page 35
What  s Right with the Old Model......Page 36
What  s Wrong with the Old Model......Page 37
Adding a Little Chaos to the Model: The Feedback Loop......Page 38
THE TIME INTENTION OF THE TRADE......Page 43
and the 1987 Crash: A Feedback Loop Deluxe......Page 45
The Advisor Frozen in the TV Lights......Page 47
Feedback Loops and Market News......Page 48
The Time Intention of the Trade Clarifies Many Things......Page 49
THE STOCK MARKET MODEL I USE......Page 50
MARKET PREDICTABILITY......Page 52
Jesse Livermore......Page 53
Fair Value: The Theory of Stacking the Money......Page 55
FAIR VALUE......Page 56
Bridging the Math Problem......Page 57
A Dollar Today Is . . .......Page 59
An Important Conclusion......Page 60
Applying the Money Rules to Calculate a Lump Sum Pension......Page 61
How Interest Rates Affect the Lump Sum......Page 64
STACKING THE MONEY TO DETERMINE BOND PRICES......Page 66
STACKING THE MONEY TO DETERMINE STOCK PRICES......Page 68
John Burr Williams......Page 69
You Are at Bedrock......Page 71
WHY INTEREST RATES ARE SO IMPORTANT......Page 72
The Yin and Yang of Stock Prices......Page 73
Response Time to Interest Rate Changes......Page 75
Inflation and the Theory of Stacking the Money......Page 77
Applying the Model to Companies That Don  t Pay Dividends......Page 78
and Market Expectation......Page 79
Resolving Paradox 1: I  m Happy When I  m Sad.......Page 80
Resolving Paradox 2: How Can the Tail Wag the Dog?......Page 81
Technical Analysis and Unstable Markets......Page 83
TECHNICAL ANALYSIS VERSUS FUNDAMENTAL ANALYSIS......Page 84
ON TECHNICAL ANALYSIS......Page 86
BASICS OF TECHNICAL ANALYSIS......Page 87
Highlighting Divergence......Page 88
The Principle of Time Invariance......Page 89
Market Tops and Bottoms......Page 90
Recognizing a Normal Market Cycle......Page 93
The Perfect Indicator?......Page 94
Making Top......Page 95
Topping Often Starts in Wave Four......Page 96
Making Bottom......Page 98
Changing Market Patterns......Page 99
The Pivotal Point......Page 100
Obscuring the Obvious......Page 102
PARADOX 3 RESOLVED......Page 104
THE THEORY OF CONTRARY OPINION......Page 105
What Is the Theory?......Page 106
BABES and O  BUCS......Page 107
of Contrary Opinion Works......Page 108
A Brief History of the Theory......Page 109
Is Investor Sophistication a Factor?......Page 111
First Method: Investor Activity......Page 112
Second Method: Polling Services......Page 119
Gathering Data......Page 121
Examining the Results......Page 122
THE THEORY IN PRACTICE......Page 123
Using the Theory......Page 124
Understanding the Consensus Opinion and How It Changes......Page 126
Emotions and Market Volume......Page 128
RESISTANCE TO APPLYING THE THEORY......Page 129
Price Patterns, Fractals, and Mr. Elliott......Page 131
Reviewing the Dow Theory of Price Movement......Page 132
Combining the Dow and Gann Patterns......Page 133
R. N. ELLIOTT......Page 135
Expanding on the Dow- Gann Bull- Market Pattern......Page 136
Patterns Bigger than Bull Markets......Page 138
THE ELLIOTT WAVE THEORY VERSUS THE REAL MARKET......Page 139
Labeling Elliott  s Waves......Page 140
The Elliott Wave Variations......Page 141
SEARCHING FOR AN UNDERLYING THEORY......Page 144
THE ELLIOTT WAVE PATTERNS......Page 145
Stock Price Patterns Are Like Fractals......Page 146
Fractal Example 1: The Koch Curve......Page 148
Fractal Example 2: The Mandelbrot Curve......Page 149
MARKET  S FRACTAL PATTERN?......Page 152
The Search for Predictability......Page 153
Applying the Elliott Wave Theory......Page 154
Accurate Prediction Takes Vigilance......Page 155
Be Wary of Doomsayers......Page 156
Past Trading Range Markets......Page 157
Normalized  Thinking......Page 158
THE CURRENT ELLIOTT WAVE PATTERN......Page 160
The Fourth Wave......Page 162
The Internal Structure of the Fourth Wave......Page 163
Contracting Volatility......Page 164
The Time Scale of the Trading Range Period......Page 165
THE ECONOMIC   WHY......Page 166
Overvalued, Undervalued......Page 169
THE FINAL STAMPEDE......Page 170
Caution......Page 172
TWO APPROACHES TO MARKET TIMING......Page 173
The Strongest Market Signal......Page 175
Which Approach Is Best?......Page 176
Market Timing Using Moving Averages......Page 177
MY FIRST MOVING- AVERAGE STUDY......Page 179
Time Cycles in the Market......Page 180
Using Resonance to Find the Time Cycles in the Market......Page 181
The Original Moving- Average Study......Page 182
The Results......Page 183
Original Study Restrictions......Page 185
The 130- Day Moving Average......Page 186
Factoring in the Whipsaw......Page 187
The 1966 to 1982 Period......Page 189
Adding More Dimension to Moving Averages......Page 190
Bollinger Bands......Page 191
Which Bollinger Band Is Best?......Page 192
The Bollinger Band Strategy......Page 193
Summarizing the Trading Range Study......Page 194
Restrictions on the New Study......Page 195
The Results......Page 197
MOVING AVERAGES AND FEEDBACK LOOPS......Page 199
USING STANDARD TECHNICAL ANALYSIS......Page 200
THE RISE OF HEDGE FUNDS......Page 201
Why Mutual Funds Might Not Do as Well......Page 202
Hedge Funds......Page 203
Hedge Fund Investment Strategies......Page 204
AN OPTION STRATEGY FOR TRADING RANGE MARKETS......Page 207
A FUND OF FUNDS FOR A TRADING RANGE MARKET......Page 210
Index......Page 212