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Don't forget the New Moon. Gold/Silver has consistently followed the moon cycle for years.

The typical move is bUy the FUll moon and sEll the NEw Moon. ( seems to be either a turning or acceleration point)
TERRY LAUNDRY ON GOLD
I noted the Aden Sisters, long time respected Gold analysts had presented a study of the Gold price as it related to its 65 week MA. Their conclusion, which I am adopting, is that a ullish trend finds support at its 65 week mo!ing a!erage. Most important, is that this criteria worked well in the ear market years and the ull market years. That is, any trend that holds a o!e its 65 week MA is ullish, any trend that holds elow its 65 week MA is earish. Also uses 65 week ema

The pro a ility of &'()*IG+T +I &) ,&- will get tagged on day session is .6/.
"T#$%

)e0'ulgaris% 1Thurs, 2an 3$,4556 4%$4 AM (T7 )(M(M8() T+IS expanded down days that close near the day lows almost always ounce o!ernight often after a oo reopen dump... the lows usually get retested and the rule of thum on the upside we shud not reach the last hour high..

If you have a losing position that is making you uncomfortable, the solution is very simple: Get out, because you can always get back in ! "aul #udor $ones
The elements of good trading are! (") cutting losses# ($) cutting losses# and (%) cutting losses. &f you can follow these three rules# you may have a chance. 'd (ey)ota &f & have positions going against me# & get right out* if they are going for me# & )eep them... +is) control is the most important thing in trading. ,aul Tudor -ones
%A loss never bothers me after I take it I forget it overnight &ut being wrong 'not taking the loss (that is what does damage to the pocketbook and the soul ) *$esse +ivermore

9r. Ari :ei!...said people hold a losing trade longer then a winning trade
A good trader knows how to make money A great trader knows how to take losses Todd .arrison

,ost traders should follow oleman-s trend advice: !buy high, sell higher or sell low, buy back lower!.
Statistical study done by William O'Neil, the founder of IBD. Over a year ago, discussed a !et"odology #or deter!ining $"et"er t"ese surges $ere one day wonders or true bottoms. %O&Neil #ound t"at "e could se'arate t"e %one(day $onders% #ro! t"e i!'ortant turning 'oints by #inding evidence t"at large institutions "ad regained t"eir a''etites #or e)uities* +"ile t"ere are no guarantees, t"is !et"od "as a very res'ectable trac, record*

-istorically, t"at $ould be evidenced by a signi#icant #ollo$(t"roug" rally #our to nine days a#ter t"e #irst big !ove u' a#ter a longer do$nturn* Re)uire!ents include t"e !a.or indices rallying /0 to 10, and on greater(t"an(average volu!e, in t"at #ive(day $indo$* % A %con#ir!ation $indo$% $"ic" runs about /2 days*

the definition of a /oss hook0 includes the statement, that: Any failure by prices to continue in the direction of the move subse1uent to a breakout of the 23 point of a 4*3*5 formation is a /oss hook0 Don Wolanchuk has a theory re. the wednesday before options expiry, being either a low or a high, this time implying it will be a low !an "#$% also oleman said the same thing years ago , e&cept he liked the 'hursday before ... one mans distribution is another mans accumulation...if you ha(ent forgotten the boy) allways make it ugly into the wed before the week of e&piration......the boys need a big payday to pay for all them goodies and (acations they took in december....snort.... http%**www.siliconin(estor.com*readmsg.asp&+ msgid,-./-0-01

-ed efore week of &pt (0p is the highest pro a ility play I ha!e encountered in my
career as a $55/ ";,, TIM( professional trader for se!en years. I owe it to cheif for ha!ing pointed out the fascinating pattern. I initially looked at it with skepticism, <ust as with anything else that anyone points out. It took se!eral months for me to understand the idea and uild it into my trading. I ha!e een playing it for o!er a year now, risked and made real money. =ou <ust need to know what to look at... as speed and momentum play a huge role. I will attest to you and e!eryone on this oard that when wollie mentions the -ed efore &pt (0p, there is no illusion > it?s $55/ )(A,. From: migz (migz g)Date Posted: August 06, 2003 at 10:39:44
UncloakedBill : day 4 of e0piry >> often does opposite day $ @ day $ is wed efore opt e0p "rom% daAcheif 1don wolanchuk7 9ate Bosted% 2anuary $$, 4556 at $.%3.%56 weekee watchee is no longer a part of the eCuation...... ecause of the new weekly e0pirations... weekee watchee....or as some call it...-eird -ollie -ed....the wed efore the week of the monthly e0piration......it has een shown that turns of importance occur on or a out that day of the month.....oct54 ottom.....march 4555 top.....and a myriad of others........now that options e0pire e!ery week which has <ust recently een instituted....it would appear that the coming last off has een prepared for in order to handle the speed of the coming ad!ance...relati!e to what has preceded it.....all of course imho fwiw

6on 7olanchuk : !advances on lite volume is bullish lack of institutional investing is bullish lite volume means no sellers when the institutions are out the market allways goes up on lite volume cu8 the selling is out of the way heavy volume comes in the topping process as institutions load up into the obvious at much high prices remember it isnt buying that causes rising prices its the sharply rising prices that cause the buying and of course heavy volume9 ! it is always thus so until you see the kind of froth we saw in 4::: 3;;; firgit about worrying about a decline !
"rom% daAcheif 1don wolanchuk7 9ate Bosted% April 45, 4556 at $5%$$%5# & wave advances are easy to calculate as the length of it can e determined y finding the center of the mo!e and dou ling it.....the center of any 8 wa!e is usually the center of the sharp reaction in the middle of its central running correction......in this case...appro0imately 5.5.....from the low of mar$5 at 53D to 5.5 is 56 pts.....56 added to 5.5 is 6D6.....the high was 6D4 asis apr.....

"rom% daAcheif 1don wolanchuk7 9ate Bosted% 2anuary 5$, 455D at $D%5$%$. u wanna day trade then use the dows $4 hour relati!e strength inde0 o!erlayed on its half span ma....using a strict 65 minute hour......watch that with the hourly dow ar chart and you will e amaEed...... calculated on the 65 min hours...$535 $$D5 $4D5 $55 455 and the close...est....
"rom% daAcheif 1don wolanchuk7 9ate Bosted% Septem er 5#, 455# at $4%56%5D learn how to do the 65 dow rsi and u will drop e!erything else......and add fi to the eCuation....

"&S8AF: says the fi!e weeks form thanksgi!ing to Fhristmas is the est fi!e weeks of the year

23D4O bear markets e&tend by ".., ".-0- and ".#5-% bull markets e&tend ".1"5, -.1"5 and 6.-#1. *(;)&T)A9(G.. noticed that );T is good only for intraday ... and I fa! the 3 min G );T *ot good on a daily
neurotrader : Many years back, an old timer trader told me of a simple analysis when never to short .. The analysis is so simple that many think its silly, well, that ole timer is a millionare a few times over neurotrader : one of his many tips ack then 1which can still apply today7 was *('() ('() ('() short when a asic weekly MAF9 is near 1or has turned positi!e7 plot a weekly *9H with macd neurotrader : very simple analysis to keep a bear from getting hurt chart coming if any like

tepid4 . . Wed, ep !", #:#$%M &T if I were STA)TI*G &'()>> I would de!our the following>>$.,e"e!re $.43 4.frost and prechter 3. ill williams D.wilder 5.get a cheap real time feed 6.hoyle on poker #. lack <ack card counting 6. no paper trading ..small ets for 6 months #. :ISS 6. then come here and you will know as much as <ust a out anyone here one more thing>>look up 'A* T+A)B(, see if he still offers a BS=F+ Brofile for Traders , take it>> do T+AT "I)ST tepid4 . . -ed, Sep $5, 5%5.BM (T welp>>i am a nano>trader and trade e>mini only after years of ig spoo only>>I ha!e ne!er traded in stocks, and ha!e not done in options spec since $.66ish>>for me the est ook at this stage, the one that is most likened to what I do 1and if you are real well !ersed in TA7 is the one on 8,AF: 2AF:>> tepid4 . . -ed, Sep $5, 5%34BM (T theory of lack<ack >>peter griffin tepid4 . . -ed, Sep $5, 5%$4BM (T ottom line% I look for a rich TA deck, place a et with a hard stop ased on / of total eCuity, mo!e stops only in my fa!ouir after initial entry, remo!e partials and ride>>the settings and e!erything else on the etting has not een really discussed here in o!er a year and will not e.
And then the classic from Tepid%

IThis rings me to G;);S% They all ha!e the answer and none of them ha!e the answer. =ou can et on +och erg, )osen, +adik, -olanchuk, A!id, A!id archi!es, Farolan, Skye, Fol y, &yster, Fal, M- -alker, Ath o, $36$, ThrustyJ)usty, Bolarcap, Gran!ille, e!ery freaking FIT, 4c, G., 4-A'(S, *euro and in the end they all ha!e more cycles, more key dates, more wa!es, more counts, more rotations, more sacred num ers, and more this and that than you ha!e money>S& =&; -I,, 8( 8(TTI*G &* =&;)S(," knowing that &*,= =&; win or lose. Specifics% my ad!ice is this% go spend K355 ucks on a psychologist to gi!e you a attery of

tests to see if you are suited to trade for a li!ing and find out what TIM( frame your personality is geared to trade I" you are suited to tradeII T(BI94 ,I:(S T& ;S( A SB&&S 3 MI*;T( ,&F 1,I*( &* F,&S(7 1,I*(7 F+A)T
$5 month SLB ma on F,&S(Mwonderful indicator % as long as F,&S( on monthly greater than $5 MA on F,&S( then gi!e 8;,, enefit of dou t like olemanNs 3D wk ema on sLp

Tepid4Gthere is a large post in the :+A,SA archi!es on ? ack thrus? for swing trading and there use >> twocents... "ri, 9ec $#, #%36BM (T my fa!orite trend ma, $6 ema should e all you need, in all time frames +IS 8(ST 5J4D3 SMA, 5J$6 (MA, 4D3 0 5 M 3 T)A9I*G 9A=S..15MI*J$6B()I&9S M 5J$67

i use the 5J$6ema, 5J35sma, and 5J6$sma. 5J4D3sma.. 5J M 5 minute


one of the presto methods 1he was at a!id in the mid to late .5?s7 was the 5J$6ema crosso!ers of the 5J35 at certain times of the day. it?s particularly good for afternoon richard ney mini> crashettes.

4peso$ % the open, $5>$5>35, $ pm, 3%35, and D%$5 are my fa!orite intraday times. F&,8= S(TTI*GS 4peso$ % look at the 65 min sp0 with macd col y settings MM 6,45,6 neurotrader % S=*()G= .. 65 min looks a tad etter than 65 .. ut as I said earlier , I elie!e col y only used the a o!e for trend , then he looked for rsi di!ergences .. on the $5 min frame .. 6 rsi setting
4peso$ % if you go ack and re>read <esse li!ermore and mr gann on the markets of the early $.55?s you see the same dilemmas in trading against the ig money 4peso$ % Cuote a out the mental mechanics of traders !ersus computer is the cru0 of the whole successJfailure odds for traders like us,,,if you can?t learn to sell high and uy low like a ro ot, you don?t ha!e a chance long term 4peso$ % uying and selling reakouts will kill you,,,it works once in a while ut usually you are the patsy for a ro ot

<=A+>A ?>@> >#AB=> >@##ICG AD 4;,5,5 AC 5 ,IC?#@ B=A/#


twocents... -ed, Aug D, $$%5.AM (T

i use the 5J$6ema, 5J35sma, and 5J6$sma. 5J4D3sma.. 5J M 5 minute


one of the presto methods 'he was at avid in the mid to late ()*s+ was the ",!-ema crossovers of the ",.) at certain times of the day. it*s particularly good for afternoon richard ney mini/crashettes.

twocents . . Tue, Sep 4$, $$%53BM (T i got the $6 ema and 35 sma from a guy in Cue ec i use them on e!ery time frame,, ut especially the 5 miniute
ho son
twocents "ri 53J56J.6 $6%4# FST oleman% i was !ery interested to see your remarks on holding o!er had it closed off the highs and selling ecause it closed on the highs. this is one of the ma<or points in an old charting system that i learned a long time ago called the ho son. the way i ha!e always rationaliEed it is that closing way up 1or down7 there lea!es you at the mercy of the o!ernight crew. also it is great for locals and other daytraders to close out a trade on strength knowing that they can come ack in the ne0t session at no worse and usually etter than where they would e holding o!er. keeping the daytraders and locals happy ensures continued !olume and liCuidity, closing on or !ery near the highs sets up for a sell, temporary or otherwise. wonder if you ha!e other thoughts or e0planationsO oleman . . -ed, 2ul 4D, .%4DBM (T

I watch the 5 and $5, with the 35 min and day trends clearly in mind. Barrot lady taught me to go to the one minute when my target was eing approached. I prefer a com ination of $5 and 3D MANS on all time periods less than weekly.1e.g. $5 min chart, wit oth $5 and 3D MA on it7 So why the $5MAO I see the 3D holds the trend ut what is the $5 used forO It <ust helps me !isually. A reminder of the strength of the trend as it approaches or crosses or runs away from the long MA......&n weekly, I use $5,55. 8ut I trade off support and resistance. MA?s tell you what the trend is in the time period of the MA. SJ) tell you where price is going to pause, re!erse, or continue. +ope$ said that today. I?!e said it for years. &yster has shown o!er and o!er how to trade it.
brilliant analyst named $ames Alphier $ames worked on a market method which he called !prolonged li1uidation ! Alphier-s work is pretty much forgotten today, but he discovered a system for identifying maEor market bottoms #his is how Alphier-s method works @ach week count how many days the >F" closed up and how many days it closed down If there is a day that the index is exactly unchanged, give that day the sign of the previous day Dorget about holidays or any day in which the market is closed @ach week go back over the past 4G weeks and count how many total days are up and how many are down If, in the past 4G weeks there are at least 4H more down days than up days, you have a maEor bottom and a buy signal

oleman A market genius is anyone who buys dips in uptrends and sells rallies in downtrends "eriod $ust that simple @verything else is noise ole!an*** +ed, Nov /3, 451167 ET
-ere co!es oyster $it" "is deat" $atc" tic,ing only one day a#ter boug"t GE #or t"e #irst ti!e in years* Good lord88 # $ouldnt buy GE today, $ouldnt buy anyt"ing* Ever*

ole!an*** +ed, Nov /3, 459:67 ET Every ti!e it 'uts in 9 clear 'us"es do$n and s"o$s 'o$er to t"e u'side, &ll ;UY it* All t"e $ay do$n to <ero*5= ye'* And trut" is, as everyone #ro! Solo!on to >esee Liver!ore ,ne$, t"at t"e !ar,et tends to !ove in 9 'us"es to a "ig" or lo$* 7a!a gu!' taug"t us $ell, /,1,9**********/,1,9*********$it" re'etition, even us Gu!'s got it* 5=*****

ole!an*** 7dding to winners is the most critical aspect of trading. If pyramiding Which has been pushed by successful traders e(er since the days of 8i(ermore and 9ann$ is properly done, you can be right " time in 6 and make a ton of ::. Without pyramiding, it is almost impossible to make money trading any futures market. ;ear that+ I repeat, ,,Without pyramiding, it is almost impossible to make a profit trading futures.
+isten to 7hat Iolume #ells JouK #here are 6 simple rules to learn in order to interpret price and volume movements: 4 Increasing volume on decreasing price signals an acceleration in selling pressure and price decrease 3 Increasing volume on increasing price signals an acceleration in buying pressure and price increase 5 6ecreasing volume on increasing price indicates an easing in buying pressure and a leveling in price or price reversal G 6ecreasing volume on decreasing price indicates an easing in selling pressure and a leveling in price or price reversal 5 =igher than normal volume at price highs indicates selling into strength and a price ceiling 6 =igher than normal volume at price lows indicates buying on weakness and price support
0rom: UncloakedBill

risk management>>>losing positions PPPP

ent: -,1$,1))# -:!2 3M

dan and mr mon , if you are in those positions using futures then you may or may not want to give this some thought: look at the %45T647 of your trading employnig futures as a segregated item//ie: total capital, 8 risk at entry e9pressed as a function of total e:uity then calculate your si;e and stop basis that relationship//many <overtrade< their e:uity. 4vertrade is not the number of trades but is the 8 risk to e:uity as a function of si;e, stop, and total capitali;ation of the futures account.0or me the greatest is 3=W3> on initial entry, never e9ceeds !.("8, usually begins at .$"8, and then is geared up from .$"8 sometimes but 7&?&5 e9ceeds !.("8//all of my trading keys off of this as to initial entry, adds, partial li:uidations , going to flat, or reversing.0rom a profitability perspective,ie when a trade is a *winner* , the whole approach is viewed as 47& @3M%36A7 until a 5&?&5 3= position is assumed.0=3T is also a position.The concept behind 47& @3M%36A7 facilitates the adds, partials, and full li:uidations.4nce in a winner stops are rapidly moved to reduce the campaign e9posure to less than !.("8 with the first *pressing obBective* being B.&.'break even+ , from there everything revolves around this: 4n a 11" day per year work year, what 54@ to overall account e:uity is C to a handsome 545'rate of return+ where risk is e9posure is ma9imum !.("8 on entry, reduced to B.&.,and then trailed at the <handsome obBective<//most would be shocked to know how =6TT=& is re:uired when employing futures leverage.6t is the dogged pursuit of these %54B3B6=6T6& that add up over time. 47& M45& thing//this approach has allowed me to do the following: not trade a stock in the last !- years, not give a flying flip at the moon as to mkt direction, reduced 3B 4=UT& risk to <are they going to open today< as they have almost everyday since !2(1,shortened my time frames,reduced the game to something akin to <balck Back card counting*, and most of all reduce risk to the point where the fatal B=4W 4UT trade has nought been a concern since !),!(,-2//remember:TD6 73E& @37 B6T&

0rom:

UncloakedBill

ent: -,1$,1))# -:#! 3M

tying 6an*s position at !)$. to my prior posts although 6 rarely hold overnight would be as follws in a hypothetical: !.+ do 6 have an inflection area identifiedF >es, !)"2/!)$! centered !)"- 1.+ 6f i enter trade basis my current e:uity run where intitail risk is C or less than !.("8 , how many caks can 6 do initially with a stop at !)"$."'") cents slippage on ma9 low of band+ ..+ with current 54@ at ".) '- days #) handles !)$.."/!!).." app9+ where should my current stop on campaign be basis my 54@ daily target basis a 11" day year #.+ over any e9tended time frame what is the app9 ma9 54@ for a position move in trend 'let me assure you it is =& than ".) roc+ ".+ where are my 7UMB3D for today $.+ what is the ne9t band U% in the direction of trade tanner% 1Tues, Apr $, $$%4# AM (T7 In an attempt to help you 1and some unknown lurkers out there in a!id land 7let me throw some ideas your way. Go to prophet.net for their free charts . &n indices pick 92>35 , then pick $5 years of chart data .it will automatically gi!e you monthly ars , change that to weekly .I check hide !olume and uncheck log scale. Flick detach at ottom and enlarge to full screen . *ow look at it for a least $ minute . -hat do you see. -hat did I say to myself when I looked at it . I said to myself , self , T+( ,&-(ST )IS: (*T)= B&I*TS &* T+IS F+A)T IS AT T+( +IG+S A*9 ,&-S. *ow how do I go a out to find them with some help of all these asic TJA indicators . Though trial and error I decided the the -((:,= 8ollinger ands were the est. *ow click on technical studies . Then dou le click 8ollinger 8ands =ou may trade less ut if you wait for the optimum time to enter a trade you should ha!e more luck . *otice during the ear market you want to sell the top and , and during the ull market you wanted to uy the lower and . Most money is lost while -all Street does the +():= 2():= 1 (,,I&TT -A'(S 7 etween the ands . 9on?t e !ictim of -+IB,AS+(S . Trade less , pick your point of entry and -AIT "&) IT. =ou can choose to trade (T"?s , stock ,futures or options, what e!er fits for yourself and your account . I apply these to all charts I look at . 8asic TJA 8(A) );,( if you take out the pre!ious years low, e0pect lower prices to come with a possi le rally in etween . ;se S;BB&)T and )(SISTA*F( ,I*(S and what e!er else you like in support of the 88. ..That?s the est stuff I can offer you 9oug. Blease take some time and use your rain to try to see what I am saying here . I want to see you succeed .In simple terms 1if your rain hasn?t figured it out 7 9ougie the weekly 88 are the most powerful tool out there that I use. I ha!e found what works for me , I hope you can find what works for you.

The ?anguard &nergy 0und twocents... Tue, 3ug 1#, !):#2%M &T real estate, commodities, gold, stocks, cash,,,in order of preferred investment at this stage GU <value< stock mutual funds in mid cap and small cap. large cap inde9es. ditto for non U stocks. real estate stock funds: reits and operating companies and international. commodity inde9 funds. metals and energy funds. health funds. inflation/inde9ed bond funds.

SA> ? Dece!ber /4,1229 A royalty trust co!'any !ust 'ay out so!e large #i@ed 'ercentage o# its cas" #lo$ on a regular basis, .ust as a RE T !ust* T"e US !ay "ave !ineral royalty trusts, too, but &! not #a!iliar $it" t"e!, and in any case US trusts $ould not bene#it #ro! currency !ove!ent nor act as a "edge against dollar "oldings* T$o o# t"e better ,no$n ones are 6engro$t" ANYSE= and S"iningban, AToronto, also )uoted in t"e &&'in, s"eets&&* o$n )uite a bit o# S"iningban,, $"ic" is currently 'aying (( "old your breat" (( /*10 'er !ont"* T"at is not a ty'o* And, given t"e strengt" in BD relative to t"e dollar and t"e 'rice !ove!ent in NG At"ey&re :C0 NG, 1C0 BL=, it&s really done )uite $ell over t"e 'ast year* 6engro$t" "as "ad !ore a''reciation in its s"are 'rice, but S"iningban, is u' about 920 in US ter!s t"is year (( not bad at all, es'* $"en one adds in t"e !ont"ly 'ayout Ag8=* Dro!5 !erlin A7i,e Eorell= ;y t"e $ay, it is being done no$*** using only t"e astro based c"arts, 'ost !utual #und trades at t"e

c"artsedge site* Average return using 6ro#unds Ultrabull and Ultrabear #unds is over 10 'er $ee, $it" end(o#(day only* A,S& )yde0 9ynamic 8ull funds and 9ynamic 8ear funds. MCLAREN IN A TREND, COUNTERMOVES LAST ONLY 1 TO 4 DAYS,IF MORE TREND OVER!!
'he rule for the <=2 and most markets$ is while the markets are trending in a >Normal or ?ast 'rend> they will not correct back against that trend mo(e than 6 days. 4emember, we don@t start that count until a daily low is broken. <o there is specific criteria related to >'IA3> or number of days to mo(ements$ that can be accurately applied to specific style or mode of trends. When markets trend there are mo(es against the trend in force and are called counter trends. Bounter trends ha(e - time series. 'he first is " to 6 days which appear in normal or fast trends and the second series is 0 to "# days,

There are two series of counter trends. A first degree countertrend of 1 to 4 days that occurs during normal to fast trend and a 7 to 13 day counter trend that occurs later in a trend.
83'@< ?I4<' 8OOC 7' ';3 243DIOE< F374@< D7I8F B;74' IN ';3 <=2

It was suggested that I e&plain the significance of the numbers and arrows on my charts. 'he normal counter trend or the normal mo(e against a strong trend, in this inde& and most markets is " to 6 days. I refer to that as a first degree counter trend. Once a leg of a trend is complete, if the inde& is going to hold the trend in a strong position, the ne&t larger counter trend should be 0 to "# days and I refer to that number of days as a second degree counter trend. Fou can see mo(es against the trend ha(e been " to 6 days while trending. On two occasions the inde& mo(ed G days and that was the last counter trend before the change in trend. 'he G day mo(e could ha(e also been followed by a higher low or lower high, rather than the spike mo(es that occurred. 'he pointing fingers and the letters >?B> indicate a >false break> pattern. Which is when the inde& breaks to new highs or new lows and re(erses. <ince most significant highs and lows are set up with >false break> patterns of some sort, it is important that we recogni)e those possible circumstances when they appear on the chart. 'here are maHor and minor >false break> patterns.

There is a very important technique I have explained on numerous occasions. After the second test of the lower high the market came down 5 days.

Remember my rule for this circumstance that once a market exceeds twice the time of the decline we can look for a failure of the rally. LOOK AT YEN CHARTS BELOW...

This chart re rese!ts a c"assic atter! o# tre!d right out o# m$ D%D i!structio!a" series& This is a c"assic '("o)o## tre!d* i!to the 200+ high& ("o)o## tre!ds are o,-ious ,ecause o# the three or #our asce!di!g tre!d "i!es& .t is a"so eas$ to see the start o# the e/haustio! "eg or "ast "eg u & The mar0et e/hausted, the! ,ro0e a!d came do)! to the re-ious high, agai! somethi!g that occurs o-er 102 o# the time& 3!e o# the 0e$s to success i! tech!ica" a!a"$sis is to 0!o) )hat is '!orma"* so $ou ca! a-oid the a,!orma"& . did!4t "ast o-er 40 $ears i! this ,usi!ess ,$ tradi!g the a,!orma"& The ,ou!ce #rom the ' re-ious high* roduced a seco!dar$ or "o)er high that had three tests o# the "o)er resista!ce "e-e", agai! -er$ t$ ica" o# a "o)er high& The i!de/ the! came ,ac0 to the "o) that started the #i!a" e/haustio! "eg u a!d ra""ied& 5a!$ o# the )or"d stoc0 i!de/es ha-e ',"o)o## tre!ds* that a ear com "eted a!d 6ust came do)! to their re-ious highs as this mar0et did a!d )e4re !o) tr$i!g to determi!e i# the$ are roduci!g seco!dar$ or "o)er high or ,asi!g #or a!other "eg u or a retest o# their highs& 738 9:T4; TA<: A 933< AT T=: DA.9> ?=A@T

There is a -er$ im orta!t tech!iAue . ha-e e/ "ai!ed o! this sho) o! !umerous occasio!s& A#ter the seco!d test o# the "o)er high the mar0et came do)! + da$s& @emem,er m$ ru"e #or this circumsta!ce that o!ce a mar0et e/ceeds t)ice the time o# the dec"i!e )e ca! "oo0 #or a #ai"ure o# the ra""$& ;o there )as a! 11Bda$ 8:A< ra""$ -ersus a + da$ dec"i!e setti!g u the #ast mo-e do)!& The #ast mo-e sho)ed o!"$ #irstBdegree cou!ter tre!ds o# 1 to 3 da$s u!ti" it ca itu"ated i!to "o) (agai! a"" -er$ !orma") a!d ra! u to the "o)s o# the seco!dar$ to or 'o,-ious* resista!ce "ast )ee0& The i!de/ o!"$ mo-ed do)! 2 da$s a!d 6um ed i!to that zo!e o# distri,utio! sti"" i!dicati!g stro!g mome!tum& The '!orma"* atter! o# mo-eme!t is to ru! i!to some co!gestio! ,ut to sti"" get margi!a""$ a,o-e the "ast series o# highs a!d the! correct )ith a mu"tiB)ee0 mo-e do)!& .t is that mo-e do)! that )i"" determi!e i# there is a to i! "ace (the atter! )ou"d ,e a "o)er dou,"e to ) or i# that mo-e do)! ca! ,e Aua"i#ied as a cou!ter tre!d the! a !e) "eg u to !e) highs )i"" a ear& ;o !o) it a ears as though the $e! )i"" test those highs at 119B"e-e" a!d the! sho) a mu"tiB)ee0 correctBthat )ou"d ,e '!orma"&*
B437'IN9 <3BOND74F ;I9;< 'O ON?I4A 7 B374 'hat would lea(e a threeIthrust pattern for a low and set up a rally to produce a lower high or secondary high. 'he rally into a secondary high can take a few months. It is normal for the rally that produces the secondary high to take as long as 90-calendar days. Aanfred but high '4IN readings occur closer to the end of a mo(e rather than the beginning. only in a bull market but not in a bear market where the '4IN top leads the price bottom my weeks to se(eral months. 'his aligns with the DIJ story, in a bull market typically a minor sellIoff creates a lot of fear DIJ K"..L or so$ while in a bear market complacency reigns despite the marking is heading low bottom combination% high '4IN K high DIJ trend continuation combination% high '4IN K low DIJ e.g. !uneI!uly -..", 7prilIAay -..-$

direction on fed day


As $e !ention a"ead o# eac" DO7B !eeting, $atc" #or $"at "as no$ beco!e ,no$n as t"e %Sc"ae##er&s slig"t(o#("and !ar,et reaction*% T"is unscienti#ic '"eno!ena is t"e instantaneous reaction to t"e #irst ne$s

#ro! t"e DO7B* &f that first tic) is higher and appears to reverse lower on subse/uent bars# the

mar)et will typically finish in the direction of that first tic) .


calendar*** +ed, Nov F, 15C967 ET re!e!ber greenie bar rules, /st big !ove is in rig"t direction ( 1nd big !ove is countertrend, 9rd big !ove e@eeds 1nd

calendar : remember * after fed always has 5 moves * first move is true direction but brief * then reverses for second move * look for entry *then 5rd move is real deal in same direction as first
;ncloaked8ill % ;B>D to 6 minQ down to the $6>4D min markQ and ;B the rest of day e0pected fed day cycle "&MF A**&;*F(M(*TS T(BI9 TIMI*G $7 Action D>6 mins 47 )eaction $6>4D mins 37 )eal Mo!e

snippet of don hays GGGG %ty'es% o# indicators5 %7onetary Balls To's, but Only 6syc"ology +or,s to
Ball 7ar,et ;otto!s&C

)egret Se!eral Minyans ha!e e0pressed regret at ha!ing missed the 46/ mo!e in the market o!er the last nine months 1I ha!e allowed for not picking the
e0act low7. If this is how you feel, I respectfully recommend that you shouldnNt e trading . I say that you shouldnNt e trading first from a psychological point of !iew. A trader must have the mindset of not looking back, but looking forward This does not mean that she shouldnNt use historical data, nor use past performance 1losses and gains7 in deciding how much risk to assume going forward. #his means that regret is an emotion Llike all emotions in tradingM that is more than useless, it is counter*productive @motions cause mistakes and one mistake could erase several right decisions

& -ohn (ucco

Gold5 "ig" HI:/( lo$ H1C/ Dibs5 :I*F( H:92 F/*I( HF1I C2( HCCF 9I*1( H434 19*F( H93C

2IM SI*F,AI)S G&,9 F&I* B&)T"&,I& $.$5.5D


My general recommendation at this point for a portfolio in the H"),))) range would be to salt away -) one/ounce %hilharmonics and a bo9 of 1) M $. certified H1) Iouble &agles. @ut that in half, if you have a budget in the H1",))) range. Dowever, if a customer is fortunate to ac:uire a si9/figure portfolio, 6 would strongly suggest diversifying the collectible allocation with some older Type 6 H1) Iouble &agles. We felt so strongly about this segment of the market that we Bointly published a book on the matter, which 6 would be happy to comp for inclair followers. 4bviously, knowledge, in any market, canJt hurt and, therefore, proves to empower investors. 6M4, a solid H")k portfolio of gold coins would be comprised of: !. -) / 4ne/ounce ((((3ustrian ?ienna %hilharmonics. 1. 1) / @ertified M $. H1) Iouble &agles '!()-/!(.1+ 3nd, augment portfolio with: .. @ertified Type 6 3U")K H1) Iouble &agles '!-")/!-$"+ The reason 6 believe that a certified LIouble &agleM H1) gold piece is the best choice is based fundamentally on proBected supply and demand. upply is fairly fi9ed and demand is strong and steady in this area of the market. To summari;e it,

these coins are Llarge, old and goldNM making for popularity, retail marketing support and, furthermore, providing ongoing li:uidity for the product.

2;*: 8&*9 ";*9S

four of the Hunk bond funds holding lower rated Hunk issues that I watch are A;B7J, ?79IJ, !;;BJ, and EA;FJ. During bull phases these are the fund that outperform. <ome of the more conser(ati(e Hunk bond funds I watch are ?;F'J, 2;FDJ, D79IJ, !7;FJ, 7B;IJ, 27J;J, 24;FJ, <';FJ, <2;IJ, and DW3;J. I stick with the more conser(ati(e ones because they are a bit more trend persistent and primarily ?;F'J and 2;FDJ since they are the only ones that are free of short term redemption fees. 'here were but a few trading opportunities this year in Hunk since it has been primarily a buy and hold type year and an e&cellent place to park cash in lieu of money market funds.974F <AI';

I*",ATI&* B,A=S
in any e!ent one needs to ha!e een loaded up with gold 1TG,9H, ;SAGH7, commodities 1BF)9H7, and real estate which ha!e mostly outperformed the euro as well as the dollar if carefully selected. e!en dull )(IT funds and real estate funds which in!ested in uilders and de!elopers and land holders ha!e done !ery well 1TA)(H, (G,)H, (;(=H7. stuff needs to e a significant part of all portfolios, whether dollar ased or not1each person has different ideas as to what?s significant7.'OA D47C3 *-cents twocents... Mon, Aug 35, 6%DDBM (T my own !iew is that the metal itself and surrogates like F(" and the grand polymetallics 1AA;:, 8+B, )TB, "FH7 are still the est et this early in the ull market. the para olic mo!es in golds are years away methinks. of course i could e wrong. twocents... Thu, Sep ., D%D4BM (T asic materials, manufacturing and ser!ices will do !ery well, tech and financials will do less well twocents... "ri, &ct 6,455D 6%56BM (T thrifty, i don?t gi!e ad!ice, ut this is what i ha!e in one family mem er?s I)A for inflationary times% 9&9GH, 9&9"H, BF)9H, TA)(H, B*)RH twocents... "ri, &ct 6, $$%$#BM (T i ga!e thrifty a listing for one acct which is representati!e of my cash accts% one good picker of ;S stocks 19&9GH7Q one good picker of foreign stocks 19&9"H7Q one good picker of real estate in!estments 1TA)(H7Q one good picker of natural resource 1energy, forestry and metals7 stocks 1B*)RH7Q and one re alancing inde0 of commodities 1BF)9H7.

CONVERSION FACTORS: BUSHELS OR CWT PER METRIC TON 1/ -----------------------------------------------------------POUNDS NUMBER OF UNITS COMMODITY UNIT PER UNIT PER METRIC TON --------------------------------------------------------------------WHEAT BU 60 36.743333 SOYBEANS BU 60 36.743333 CORN BU 56 39.367857 GRAIN SORGHUM BU 56 39.367857 BARLEY BU 48 45.929166 OATS BU 32 68.893750 RICE CWT 100 22.046 --------------------------------------------------------------------// A 7ETR B TON EJUALS 1,124*F 6OUNDS

But the one that almost got away is one that is so easy to forget, or Hust o(erlook. 'he mistake is this% 3&cessi(e Bullishness or Bearishness Hust doesn't matter until the trend turns. Fou see, big powerful mo(es generate e&cessi(e sentiment. 7ll too often the e&cessi(e sentiment gets more e&cessi(e and then e(en more e&cessi(e still, up until the point when people will actually stop looking at the sentiment as a useful measureM Soon thereafter comes the turn, and T !T is the time when excessi"e #ullishness or #earishness becomes fuel for the fire.

If you aren't paying attention, you can suddenly get caught on the wrong side of the market with too many traders racing to e&it their positions at the same time. 'raders e&iting positions like they would a building on fire. Worse, it's as if they're tossing a can of gasoline onto the fire as they go. 'he 'key' is knowing when that is happening. 'hat's where we can help. 'hat's what we're renowned for. Being long or short any market or stock$ when the position makes so much sense N I mean that it Hust SI$%S to you N and when !&& the traders you know agree with you that the position is Hust, well, '()*(+T, and e(erything looks like you are >one with the market>, and you feel like it's about time to go shopping for a new Aercedes... you@re feeling almost smug in your market wisdom II ';7' can be the most deadly situation a trader can e&perience. It's dangerous because if the situation re(erses, all the traders who are now on the wrong side of the market will be running for the e&its will make a bad situation worse II as they push the market e(er further in the wrong directionM 'his is part of what dro(e the market so high so Ouickly in Aarch and 7pril of -..#IIthere were Hust so many people who were short and absolutely "..L confident that the market was heading lower, and as they reali)ed the error of their ways, they only added fuel to the buying fire.

T-& F(*TS ;S(S A* $$ -((: F=F,( "&) ST&F:S..'()= SIMI,A) T& STA* +A),(=NS 5D T)A9I*G 9A= F=F,(

mm . . Tue, 3ug !2, !:!.%M &T $D>period Stos on fi!e>minute Spoos ha!e een Cuite good today, 1and gnenrally are good in my e0perience7.

+AMR(I A*A,=TIFS -ATF+(S 455MA &* 5 MI*;T( 8A) "&) SB&&S , A,S& 55 &* 88 8A*9S
"&) 5 MI*;T(SA,S& 4%55BM L 4%35BM TIM(,I*(S>>

M;))(= MAT+ ;7 is trading inside /*CF1C $it" eac" //It" as */3C9/1C cents* /22/F4G/*CF1C

T"e Do$ 92 Stoc,s are running to /CF*1C 'oints $it" eac" //It" as /3*C9/1C 'oints* /2222/F4G/CF*1C

0hen wave patterns are challenging to label# a simple and accurate techni/ue is to count the internal swings! 1# 2 or "%3wave moves are corrective* %# 4 or ""3wave moves are impulsive.5
67 single 8ig8ag is a simple three3wave 9corrective: pattern labeled 73;3<= >ccasionally# 8ig8ags will occur twice# or at most three times in succession# particularly when the first 8ig8ag falls short of a normal target. &n these cases# each 8ig8ag is separated by an intervening 6three5 9or 6?5:# producing what is called a double or triple 8ig8ag.5 KL &deally# the final waves down 9of a triple 8ig8ag : for December $@@% <offee are underway from the (eptember pea). (upport for our target for the end of the move= is the area where the third wave < will e/ual the distance traveled in the third wave 7# 7ND the third 73;3< se/uence will e/ual both the second 73;3< se/uence# and a ".%A$ multiple of the initial 73;3<=. /2*9/*29 KThe final 73;3< se/uence should e/ual a .4AB multiple of the first two 9se/uences:.5

'CC&>T D+7,.&ND +EC' T> 7((E+' 7N &M,EC(' 07F'($<'NT() that a line drawn from the origin of any wa!e one through the end of any wa!e two 15>4trendline7 cannot intersect any part of wa!e 3 and must intersect part of wa!e D. these rules are another way of saying that wa!e three is the most impulsi!e wa!e1ha!ing normally the steepest angle, and certainly more impulsi!e than wa!e one7, and wa!e four is Cuite lengthier than wa!e two in time.
Dro!5 deu@sous ATo! Dra,e= Date 6osted5 Se'te!ber 23, 1229 at 195/F59: t"e t"ing i li,e about neely(oid rules is t"at t"ey are logical e@tensions o# t"e structure to date, and t"ey i!'ly #uture structure* t"ere#ore t"ey "ave a !ore 'redictive #unction instead o# %a#ter t"e #act%* after third wee) of march it was clear that we had a bullish move. but it was also clear that what came in that period was not impulsive# since the @3$ trendline was hitting the structure. so gradually it became obvious that it was an irregular or running second wave in progress. this may seem li)e small potatoes# but the odds of a running ; wave in an 7;< formation are minimal in an on3going bear mar)et. so this little rule helped me to reali8e we were no longer in a bear mar)et.

take away <ust one fact from our encounter% TTTEigEags also ha!e fi!e wa!es and channel, while true impulse wa!es do *&T channel.TTT
7sgM5 /F/2FF Dro!5 "ayt"a! A-ayt"a! Albi<e!= To5 ALL Date 6osted5 7ay 24, 1229 at 2/51:51I Sub.ect5 Ross -oo,/Trader&s Tric, and JJJ #ollo$ u' As 'ro!ised a! 'osting a lin, $"ere saved !y 'resentation* "tt'5//!y$eb'ages*co!cast*net/-ayt"a!/Ross-oo,*"t!

$ill be tal,ing about Ross -oo,,Trader&s Tric, and #ollo$ u' to JJJ since !y last 'resentation last $ee,* 6ersonaly "ave done F trades in t"e last $ee,AC $ins, / loss=, in t"e 'resentation $ill ta,e you into !y t"in,ing 'rocess "o$ %ad.usted !y sails% based on !y reading to !ar,et actions, Ross -oo, and Trader&s Tric,* T"e 'resentation is about 12 !in longAC 7;=, you $ill need to "ave Dlas" 'layer to 'lay t"e 'resentation, i# you don&t "ave it on your co!'uter, "ere is a lin, to do$nload #ree co'y "tt'5//$$$*!acro!edia*co!/s"oc,$ave/do$nload/do$nload*cgi6/N6rodNOersionGS"oc,$aveDlas"P6CNL anguageGEnglis" n t"e #irst /(1 !in o# t"e 'resentation 5 t"e i!age is s"o$ing a recorder also !i@ing sounds are not o'ti!al* $ill try to correct t"ese 'roble!s in t"e #uture* -ave a nice $ee,end, -ayt"a! 7sgM5 /F1F2F Dro!5 "ayt"a! A-ayt"a! Albi<e!= To5 ALL Date 6osted5 7ay /4, 1229 at 1951/54/ Sub.ect5 Lunar Ecli'se and T"e /9 88

Let !e start #res" again a#ter correcting t"e tec"nical issue5 -ere is t"e lin, $"ic" "as all t"e 'resentations "tt'5//!y$eb'ages*co!cast*net/-ayt"a!/S"aring7yTradingT"oug"ts*"t! %%"ig"ly reco!!end%% to use #las" #or!at version in vie$ing t"e Lunar Ecli'se and T"e /9 'resentations, i# your internet connection is t"roug" dial u' !ode! you !ay not be able to see t"e 'resentation using +indo$ 7edia #or!at* "tt'5//!y$eb'ages*co!cast*net/-ayt"a!/LunarEcli'ses*"t! "tt'5//!y$eb'ages*co!cast*net/-ayt"a!/T"e/9*"t! $ (;)& M $3.#653 A;ST)IA* SF+I,,I*GS M D5.33.. 8(,GIA* ")A*FS M 5..D5#3 "I**IS+ MA)::AS M 6.55.5# ")(*F+ ")A*FS M $..5563 G()MA* MA):S M .#6#56D I)IS+ B&;*9S M $.36.4# ITA,IA* ,I)( M D5.33.. ,;H(M8&;)G ")A*FS M 4.453#$ *(T+(),A*9S G;I,9()S M 455.D64 B&)T;G;(S( (SF;9&S M $66.366 SBA*IS+ B(S(TAS M 3D5.#55 G)((: 9)AF+MAS

,A-S &" M;,TIB,( TIM( ")AM(S

e.g mtly wkly daily hrly

$. (!ery time frame has its own structure. 4. The higher time frames o!errule the lower time frames. 3. Brices in the lower time frame structure tend to respect the energy points of the higher time frame structure. D. The energy points of supportJresistance created y the higher time frame?s !i ration 1prices7 can e !alidated y the action of lower time periods. 5. The trend created y the ne0t time period ena les us to define the trada le trend. 6. -hat appears to e chaos in one time period can e order in another time period...I 9A'I9 ";,,() &* 8(+A'I&;)A, T(F+*IFA, A*A,=SIS
I can only speak for my own approach. Bsychology determines where people in!est. In other words, a market may e fundamentally cheap on e!ery historic measure, ut if people don?t want to uy it, for whate!er reason, it will <ust lie there or ecome e!en cheaper. Fon!ersely, a market may e ludicrously o!er!alued ut while it continues to attract and hold in!estors, it will go e!en higher efore e!entually collapsing when they take fright. Moreo!er, many in!estment managers feel compelled to follow the action, in pursuit of performance. FonseCuently technical analysis is the only timing tool. I monitor sentiment, mainly in terms of how it is reflected ack to us y the media. -hat people say is a much etter indicator of what they ha!e done, rather than what the market will do. In other words, people who are long are ullish, <ust as those who ha!e sold are earish, otherwise they would e schiEophrenic. This is why the crowd is most earish at the ottom and most ullish at the top. Therefore I am a contrarian thinker, ut I need to ha!e technical e!idence that the trend is changing. 7hen reading price charts, I am only interested in price facts, not theories, of which there are many I ask filter 1uestions such as, is it trending or rangingN If trending, is it consistentN If so, and we can be very obEective about this, it is easier to monitor, and less difficult to identify an eventual loss if consistence which precedes trend change =ow is it performing relative to other marketsN 6oes it have volume confirmationN ,y colleagues at >tockcube /esearch developed a superb volume adEusted indicator, which I find very useful 6oes it show any of my 5 primary trend*ending characteristicsN 7hat are the price dynamics * my term for the big up days and down days that can change short*term sentimentN I could go on but you don-t want a textbook

My definition of a market dynamic is a single>day mo!e sufficiently strong for e!eryone to take notice. This is a relati!e comparison. 9ynamics can occur at any time and some of the most important ones are contra>trend.

Single>day technical dynamics continue to pro!ide the est ullish clues. 6 last mentioned this in 0M%1)#. The up days on Wall treet are clearly more dynamic, on average, than the down days. 6n other words, ever since the Ouly 1))1 low, U indices have generally rallied more :uickly than they have fallen. This has gone on for too long to be dismissed as mainly due to short covering. Iemand is regaining the upper hand, relative to supply. ince this is hard to see on charts reproduced for this report, 6Jll post a number of indices for your perusal on my website later today. Behaviourally, the cloud of uncertainty is liftingP the war for regime change has gone better than many predicted, and the oil price is H!) off its March peak. 0undamentally, 6 agree that the outlook is dodgy. 6 can only envisage a medium/term economic rebound, but consider this. Distorically, the most bullish year, on average, for Wall treet and therefore many other stock markets, is the third year of a U presidential term. WhyF Because the incumbent president is focussing on re/election, or if he is already in his second and final term, on helping his party to retain the White Douse. With the ne9t presidential election in 7ovember 1))#, %resident Bush and his 3dministration will increasingly focus on domestic economic issues. 7ow that addam DusseinJs regime has been successfully removed, the %resident knows that only the U economy and stock market can prevent him from winning a second term. Both face secular headwinds, for reasons previously detailed in these pages. Dowever no effort will be spared to achieve the best result possible, under these difficult circumstances.I3?6I 0uller.
,eadership > *o

significant stock market rallies occur from ear market lows without good relati!e performance y ank shares. Daving fallen to 2 percent of market capitali;ation, compared to over 1) percent in most
other markets, OapanJs banks have begun to reverse their lengthy period of underperformance over the last fortnight.

Boise, patience, silence.


So says 2esse ,i!ermore. I don?t hold out 2, as the final authority on e!erything ha!ing to do with trading, nor do I neccessarily think that his ways are right for e!ery ody. I <ust find his insights fascinating, and thought perhaps others might, as well. +e defines poise as sta ility, a well alanced person with dignity of manner>as it relates to the stock market. ?A poised person is a person who can handle their hopes and their fears in a calm manner?, says ,i!ermore. Batience refers to the a ility and the self>control to wait for the opportune moment, oth to enter and to e0it. A out silence, he says ?keep your !ictories and failures to yourself>>learn from them oth?.
Dro!5 stan"arley AStan -arley= Date 6osted5 Se'te!ber 21, 1229 at /C5/45C1 RULE OD DOUR BOND T ON ON SP6 C22

The current push above the "@@@ level mar)s the fourth push against this resistance threshold since the -une "4G"Ath high. The +ule of Four condition# generally attributed to 0.D. Dann# states# in effect# that the fourth push against overhead

resistance is ma)e or brea) time. &f the mar)et punches through overhead resistance at the fourth attempt# it usually sprints very rapidly on the brea) out. &'ve studied this pattern and written about it e?tensively. &t does appear that we are witnessing the +ule of Four condition presently in the (H, inde?.
Stan -arley

The $$ +ules of Trading 3(ery day, Dennis Dartman gets up at bout -%#. 7A and writes an information packed

6 page newsletter on the world markets, oil, currencies, commodities political happenings and much more. ;e is read by the maHor trading houses and traders all o(er the world, as they stumble bleary eyed into work, grabbing the Dartman +eport to find out what happened as they slept and to get insight as to what the issues of the day will be, and suggestions on how to trade. Dennis puts his trades on public display and talks you through his logic. It is a most remarkable work, and I find it a key part of my struggle in trying to keep up with what is going on. I am always ama)ed when on the occasions I find myself in the office at an early hour to find Dennis' letter hit my inbo& about G%.. 7A. ;is tra(el schedule makes mine look tame, and from where(er in the world he finds himself, he writes and sends his letter. 7nd he still maintains a single digit handicap on the golf course. On the ?riday after 'hanksgi(ing, he publishes his >4ules of 'rading,> adding to them as wisdom increases. ;ere is today's list% ". Ne(er, under any circumstance add to a losing position.... e(erM Nothing more need be saidP to do otherwise will e(entually and absolutely lead to ruinM -. 'rade like a mercenary guerrilla. We must fight on the winning side and be willing to change sides readily when one side has gained the upper hand. #. Bapital comes in two (arieties% Aental and that which is in your pocket or account. Of the two types of capital, the mental is the more important and e&pensi(e of the two. ;olding to losing positions costs measurable sums of actual capital, but it costs immeasurable sums of mental capital. 6. 'he obHecti(e is not to buy low and sell high, but to buy high and to sell higher. We can ne(er know what price is >low.> Nor can we know what price is >high.> 7lways remember that sugar once fell from :".-G*lb to - cent*lb and seemed >cheap> many times along the way. G. In bull markets we can only be long or neutral, and in bear markets we can only be short or neutral. 'hat may seem selfIe(identP it is not, and it is a lesson learned too late by far too many. 1. >Aarkets can remain illogical longer than you or I can remain sol(ent,> according to our good friend, Dr. 7. 9ary <hilling. Illogic often reigns and markets are enormously inefficient despite what the academics belie(e. 0. <ell markets that show the greatest weakness, and buy those that show the greatest strength. Aetaphorically, when bearish, throw your rocks into the wettest paper sack, for they break most readily. In bull markets, we need to ride upon the strongest winds... they shall carry us higher than shall lesser ones.

5. 'ry to trade the first day of a gap, for gaps usually indicate (iolent new action. We ha(e come to respect >gaps> in our nearly thirty years of watching marketsP when they happen especially in stocks$ they are usually (ery important. /. 'rading runs in cycles% some goodP most bad. 'rade large and aggressi(ely when trading wellP trade small and modestly when trading poorly. In ,good times,, e(en errors are profitableP in ,bad times, e(en the most well researched trades go awry. 'his is the nature of tradingP accept it. ".. 'o trade successfully, think like a fundamentalistP trade like a technician. It is imperati(e that we understand the fundamentals dri(ing a trade, but also that we understand the market's technicals. When we do, then, and only then, can we or should we, trade. "". 4espect >outside re(ersals> after e&tended bull or bear runs. 4e(ersal days on the charts signal the final e&haustion of the bullish or bearish forces that dro(e the market pre(iously. 4espect them, and respect e(en more >weekly> and >monthly,> re(ersals. "-. Ceep your technical systems simple. Bomplicated systems breed confusionP simplicity breeds elegance. "#. 4espect and embrace the (ery normal G.I1-L retracements that take prices back to maHor trends. If a trade is missed, wait patiently for the market to retrace. ?ar more often than not, retracements happen... Hust as we are about to gi(e up hope that they shall not. "6. 7n understanding of mass psychology is often more important than an understanding of economics. Aarkets are dri(en by human beings making human errors and also making superIhuman insights. "G. 3stablish initial positions on strength in bull markets and on weakness in bear markets. 'he first >addition> should also be added on strength as the market shows the trend to be working. ;enceforth, subseOuent additions are to be added on retracements. "1. Bear markets are more (iolent than are bull markets and so also are their retracements. "0. Be patient with winning tradesP be enormously impatient with losing trades. 4emember it is Ouite possible to make large sums trading*in(esting if we are >right> only #.L of the time, as long as our losses are small and our profits are large. "5. 'he market is the sum total of the wisdom ... and the ignorance...of all of those who deal in itP and we dare not argue with the market's wisdom. If we learn nothing more than this we'(e learned much indeed. "/. Do more of that which is working and less of that which is not% If a market is strong, buy moreP if a market is weak, sell more. New highs are to be boughtP new lows sold.

#he hard trade is the right trade: If it is easy to sell, don-t. and if it is easy to buy, don-t 6o the trade that is hard to do and that which the crowd finds obEectionable "eter >teidelmeyer taught us this twenty five years ago and it holds truer now than then
-..

-". 'here is ne(er one cockroachM 'his is the >winning> new rule submitted by our friend, 'om 2owell. --. 7ll rules are meant to be broken% 'he trick is knowing when... and how infreOuently this rule may be in(okedM

T&99 +A))IS&*%#he time to identify risk is after the market has rallied big #he time to identify opportunity is after the market has sold off sharply >omehow, the investing public has managed to confuse the issue "Success is the progressive realization of a worthy ideal." Earl Nightingale If a person is
working toward a predetermined goal and knows where to go, then that person is successful. If a person does not know which direction they want to go in life, then that person is a failure. ISuccess is the progressi!e realiEation of a worthy ideal.I Stop running yourself down. 9o not think of all the reasons why you cannot e successful >> instead think of all the reasons why you can achie!e success. Trace your emotions ack to childhood >> disco!er where you first got the negati!e idea you would not e successful >> face your fears. )enew your self>image y writing a description of the person you want to ecome >> Act the part >> =ou are that personP George 8ernard Shaw said% IBeople are always laming their circumstances for what they are. I don?t elie!e in circumstances. The people who get on in this world are the people who get up and look for the circumstances they want, and if they can?t find them, make them.I So decide now. -hat is it you wantO Blant your goal in your mind. It?s the most important decision you?ll e!er make in your entire life. All you?!e got to do is plant that seed in your mind, care for it, and work steadily toward your goal, and it will ecome a reality. +ow do you eginO "irst% It is understanding emotionally as well as intellectually that we literally ecome what we think a outQ that we must control our thoughts if we?re to control our li!es. It?s understanding fully thatGIas ye sow, so shall ye reap.I Second% It?s cutting away all fetters from the mind and permitting it to soar as it was di!inely designed to do. It?s the realiEation that your limitations are self>imposed and that the opportunities for you today are enormous eyond elief. It?s rising a o!e narrow>minded pettiness and pre<udice. Third% It?s using all your courage to force yourself to think positi!ely on your own pro lems, to set a definite and clearly defined goal for yourself. To let your mar!elous mind think a out your goal from all possi le anglesQ to let your imagination speculate freely upon many different possi le solutions. To refuse to elie!e that there are any circumstances sufficiently strong to defeat you in the accomplishment of your purpose. To act promptly and decisi!ely when your course is clear. And to keep constantly aware of the fact that you are, at this moment, standing in the middle of your own Iacres of diamonds.I And fourth% Sa!e at least $5 percent of e!ery dollar you earn. It?s also remem ering that, no matter what your present <o , it has enormous possi ilities @ if, you?re willing to pay the price y keeping these four points in mind% =ou will ecome what you think a out. )emem er the word IimaginationI and let your mind egin to soar. Fourageously concentrate on your goal e!ery day. Sa!e $5 percent of what you earn. "inally, take action @ ideas are worthless unless we act on them

"rom% stanharley 1Stan +arley7 9ate Bosted% "e ruary 55, 4553 at $4%3#%53

Su <ect% SBH Brice 'elocity% Method of Falculation "rice velocity is the rate of change in price per trading day A H day price velocity is computed by subtracting the price seven days ago from today-s price, then dividing that 1uantity by seven I average the high*low*close before making the above computation. afterwards, I smooth the raw data with a 5 period exponential moving average

iShares%+ong :ong (AMEX) (-+ #.D. MA= 43,4553

Schaeffer on Fharts% The ;gly 9ollar 8y 8ernie Schaeffer 5J4#J4553 6%54 AM (T Much has een made of the negati!e impact on the dollar since recent comments y Treasury Secretary Snow regarding I;.S. dollar policy.I 8ut the ugly long>term price action in the ;.S. 9ollar Inde0 19HJ= @ .3.557 is far more significant than the transient comments of go!ernment officials. Ber the chart elow, 9HJ= has in recent months sliced through long>term support at its key 65> month and $65>month mo!ing a!erages. As I?!e pre!iously noted, the SLB 555 Inde0 1SBH @ .33.447 found strong support at its $65>month mo!ing a!erage in 2uly 4554, &cto er 4554, and March 4553. So the ;.S. dollar is clearly in worse technical shape than the road ;.S. stock market. -hile anything is possi le when UVcomparing the price action of two asset classes, it?s difficult to imagine ;.S. stocks transitioning into ull market mode if the !elocity of the dollar decline is maintained. As I see it, the technical case for at least a pause in the dollar?s decline is two>pronged. "irst, note from the chart elow that 9HJ= at this morning?s lows is within a point or so of its &cto er $..6 ottom. -ithout Cui ling a out the fact that the $..6 ottom was contained at the 65>

month mo!ing a!erage and thus reflected a healthier technical condition, there should e some dollar support that de!elops at or near this old low and also as we approach the round num er .5 le!el.

The second technical support prong for 9HJ= is the fact 1per the chart elow7 that its .>month )SI indicates the most o!ersold condition for the dollar in almost 45 years. Specifically, the last time the dollar was as o!ersold as it is right now was ack at its ma<or ottom in &cto er $.#6. The ca!eat here is that o!ersold assets can ecome e!en more o!ersold, or can remain at o!ersold e0tremes without a significant counter>trend rally.

Schaeffer on Fharts% Fan the 9ollar?s )ally ,astO 8y 8ernie Schaeffer #J$DJ4553 .%$3 AM (T *&T(% 9&,,A) +IT +IG+ &" .#.D5 &* #J$5J53

In my May 4#th commentary entitled #he ?gly 6ollar , I pointed out the weak long>term technicals of the ;.S. 9ollar Inde0 19HJ= @ .6.547. 8ut I also noted that Ithe technical case for at least a pause in the dollar?s decline is two> pronged.I "irst, there should e some dollar support that de!elops at or near the $..6 lows and as we approach the round num er le!el at .5. And second, the dollar?s nine>month )SI indicated the most o!ersold condition in almost 45 years. Specifically, the last time 9HJ= was as o!ersold was ack at its ma<or ottom in &cto er $.#6. Ber the chart elow, the dollar su seCuently sta iliEed, made a nominal new low on 2une $6, and has now rallied y a out D.5 percent.

-hat?s ne0tO I see some rougher going, ased on a num er of o stacles created y o!erhead resistance in the .6>.# area. )allies y 9HJ= since it peaked in early 4554 ha!e in!aria ly een contained at its declining 45> week mo!ing a!erage, which is less than a point a o!e current le!els.

)esistance should also e asserted at the $65>month mo!ing a!erage, a long>term support le!el that was penetrated in May and is now looming <ust o!erhead.

And finally, resistance at the 55>percent correction le!el of the rally from the April # top to the 2une $6 ottom is at .6.65.

The dollar remains o!ersold on a long>term asis, though not as much so as was the case on May 4#. 8ut unless the recent ottom was terminal, the current rally is nothing more than a correction to a se!erely o!ersold condition, in which case resistance is likely to hold and the downtrend is likely to resume. -ith the "ed committed to running the dollar printing press full speed to enforce its policy of minuscule interest rates, I e0pect the 9HJ= ear market to resume in the coming weeks and for the ultimate ottom to e well elow the recent lows. If I?m correct, the implications for the stock market are am iguous, as a weak dollar may help stimulate the economy e!en as it may also cause o!erseas money to withdraw from ;.S. stocks. The unam iguous implications are for onds 1 earish7 and for gold 1 ullish7. * &ernie >chaeffer

Dro! t"e great !inds #ro! Gustave Le ;on and B"arles 7cEay, to >esse Liver!ore and Andre$ Barnegie, to scores o# t"e greatest traders on t"e 'lanet in t"e :2Qs, I2Qs, and 32Qs, "ere are a #e$ o# t"e conclusions t"at are co!!on to all* R7ore to be added laterS 6earls, as it $ere, unnatural yet i!!utable trut"s borro$ed #ro! t"e !inds and "abits o# t"e greatest traders ever ,no$n* Ta,e t"e! and use t"e!, or discard t"e! i# you $is"* 'ach emphatically states his or her version of these IunnaturalJ rules of conduct with regard to the mar)et! TT Dorget $"at you t"in, you ,no$ about t"e econo!y* Listen instead to t"e !ar,et* Never -o'e* Never Assu!e* Never t"in, you ,no$ better t"an t"e !ar,et* T"e #uture al$ays a''ears blea,est at botto!s, brig"test at to's* +"en $e U,no$Q t"at t"e business cycle "as been lic,ed #or good, itQs a to'* +"en $e U,no$Q t"at t"e econo!y is "eading #or certain destruction, itQs a botto!* 7y .ob as a trader is only one t"ing5 to be rig"t $it" t"e !ar,et* Let t"e !ar,et, NOT t"e econo!y, drive your trading* R-aving earned a degree in Econo!ics, t"in, Qve also earned t"e rig"t to observe t"at understanding econo!ics does NOT- NG $"atsoever to$ards 'utting one on t"e rig"t side o# t"e !ar,et ? in #act itQs a "indranceS TTA trader does not !a,e value .udg!ents about t"e !ar,et, but instead only strives to get on t"e $inning side* t #eels natural to say t"at t"e drivers o# t"e !ar,et are !isguided, but t"at ,ind o# t"in,ing $ill ,ee' !e on t"e $rong side, guaranteed* TTA stoc, Aor t"e !ar,et= is never too "ig" to buyV it is never too lo$ to sell* +e never ,no$, at t"e ti!e, +-Y t"e !ar,et is doing $"at it is doing* E!'"atically, $e BANNOT outs!art "o$ t"e !ar,et 'rices or values stoc,s and indices* All $ill be understood in t"e #ullness o# ti!e* TT+"at everybody ,no$s is not $ort" ,no$ingV $"at is obvious is obviously $rong* T"is goes #or assu!'tions about t"e !ar,et being over or under(valued, as $ell as $"at t"e !ar,et U"as to doQ* T"e !ore convincing it sounds, t"e LESS li,ely it is to be true* Juestion $idely "eld assu!'tions $it" every #iber in your body8 T"ey are al!ost AL+AYS $rong8

TT+-EN it is obvious t"at a stoc, Aor t"e !ar,et= Us"ouldQ do one t"ing, AND T S DO NG T-E OT-ER ? you are starring at -UGE o''ortunity8 DORTUNES are to be !ade #ro! t"is recognition* TTT"e big !oney is !ade on t"e big !ove* 7illions ca!e !ore easily $"en t"ey #inally understood t"is, t"an "undreds did be#ore t"ey learned t"is si!'le, but 'ro#ound, TRUT-* TTT"e biggest i!'edi!ent to long(ter! 'er#or!ance is loss* T"e reason t"at success#ul traders succeed is NOT because t"ey are al$ays rig"t* Dar #ro! it8 T"ey succeed because +-EN t"ey are $rong, t"ey are ta,en out )uic,ly $it" sto's, and $"en t"ey are rig"t, t"ey sit tig"t* TTAdding to a losing 'osition is t"e SUREST #or!ula #or disaster* t is suicide* Add to + NNERS in a bull !ar,et or a bear !ar,et* 6URGE t"e losers )uic,ly* TTSuccess#ul traders c"ec, t"eir ego at t"e door* Success does not al$ays breed successV o#ten it so$s t"e seeds #or #ailure* Success#ul traders care only about one t"ing ? t"e rig"t 'lay NO+* +"at t"ey t"oug"t yesterday, said yesterday, did yesterday is old ne$s* Getting in sync rig"t NO+ is all t"at $ill "ave !attered $"en $e loo, bac,* T"e !ar,et 'unis"es arrogance, re$ards "u!ility* TTAL+AYS do your o$n analysis* Trust yoursel# ( ot"er$ise, donQt trade* Do NOT rely on ot"ers #or direction or #or trades* Use t"e in#or!ation t"ey 'rovide, but !a,e your o$n decisions* Only $"en you ,no$ +-Y you entered a trade, can you ,no$ $"en to e@it* Only $"en you ,no$ +-Y you "ave ado'ted a 'articular !ar,et e@'ectation, can you ,no$ $"en it is not $or,ing* T"ere is NO substitute #or sel#( reliance* TTSuccess#ul traders do Ua#ter(actionQ re'orts on t"e!selves* +"en a trade $or,s, t"ey observe and $rite out +-Y* T"ey analy<e t"e losses $it" even !ore intensity* T"ey UburnQ t"e !ista,es into t"eir consciousness, so as not to re'eat t"e!* Eac" o# t"e above are t"e last t"ing t"at $e $ould do, i# $e #ollo$ed our narural instincts* As said, $inning $ays are NOT natural $ays* t$ocents*** Sat, 7ar 13, /51267 ET Reverse

6oint +aves AR6+=

ts"ar', i don&t ,no$ o# any accessible 'ublic $ebsite $"ic" discusses #our 'oint continuations* you !ay be able to #ind so!e re#erences to Reverse 6oint +aves AR6+= $"ic" are C 'oint reversals* $elles $ilder sold t"is syste! AR6+= in t"e early /3I2&s* G3 and i and one ot"er 'erson i ,no$ attended a $ilder se!inar or boug"t t"e !anual Ai did bot"= at t"at ti!e* i used it #or a $"ile and reali<ed t"at t"e C 'oint reversals don&t $or, very o#ten and le#t it 'retty !uc" at t"at* being an engineer, G3 didn&t sto' t"ere* lol* he did some research and found that K point continuations wor)ed A@L of the time and 1 points $@L. you $ill also see c"arts o# 4 'oint continuations in ed$ards and !agee&s c"a'ter on consolidations, described as #lags, inverted "Ps&s, or broad saucers* $atc" #or t"e! in di##erent ti!e#ra!es and see $"at you t"in,* it can really c"ange "o$ one %sees% and evaluates $aves* t$ocents*** T"u, Se' 3, :5C367 ET aco, $atc" t"ose reverse 'oint $aves Ar'$&s=5 4&s P C&s and u' in your #avorite ti!e #ra!es, and you too can .u!' ro'e $id !s !ar,ey and da girl<* $ilder said t"e C and : 'oints $ere t"e big deal #or reversals A!ore= but g3 noted t"at t"ey only revesed 120 o# t"e ti!e,,,$"en t"ey did t"ey $ere great, but only about one out o# C ti!es did t"ey do so A!ore= but t"at !eant t"at 4 and F 'oints $or,ed I20 o# t"e ti!e88

,,so!eti!es in trading ranges you can trade t"e! all bac, and #ort" all day,,but t"e odds are better on t"e 4&s and F&s going to$ard t"e trend direction t$ocents*** Dri, Se' /2, //54:A7 ET t"ere#ore t"e %reverse 'oint $ave% s"ould really be called t"e %continuation 'oint $ave%* t$ocents * * Dri, Se' /:, //529A7 ET .cor, #or a $"ile .ust study t"e odds o# a sustain!ed !ove o## a 4 or F 'oint as co!'ared to t"ose o## a C or : 'oint,,,,or .ust trade t"e range bet$een all t"e 'oints****loo, at di##erent ti!e #ra!es #ro! C !inutes to !ont"ly,,,t"at $ay you $ill get your o$n ideas "o$ to ta,e advantage o# it t$ocents * * Dri, Se' /:, //524A7 ET and .cor, i $ould avoid even t"in,ing at all about e$ave $"ile loo,ing at t"ese #or!ations

6 TB-DORES/; SEBTS((RULES t$ocents*** 7on, Aug 92, /25/167 ET ts"ar', #or anc"ors i use t"e recent obvious range bisected by a line #ro! t"e !ost recent 'rior si!ilar 'oint o''osite t"e beginning o# t"at range* occasionally i $ill use a range corresonding to an elliott $ave count as in t"e !arc" 2/(!arc" 21 range* it&s very si!'le but consistent* also it $or,s in all ti!e #ra!es as long as you use logic in intra(day ti!e #ra!es* t"ey s"ould be a divisible integer o# one day&s trading ti!e in !inutes* so #or s'@5 C, /C, 92, :I, /92, /3C !inutes* #or s' #utures, C, /C, 4C, I/, /9C !inutes* etc* i# you use F2 !inutes t"e angle isn&t true* !any o# t"e #iner 'oints i learned #ro! g3 and t"en tested t"e! to !y o$n conviction* i "ad #iddled around $it" lines #or decades, but "e $as !y lines guru* t"e ot"er t"ing is to use C day/$ee, c"arts $it" "olidays in as blan,s* trading days only gives s'urious results over long 'eriods o# ti!e* you can get around t"at 'artly by using $ee,ly c"arts, but t"en you don&t ,no$ $"ic" day in a $ee,*

1BS
t"e 1BS originally bac, in /33F AC day total o# O WTco!bined 6/B= $s !y #eeling t"at 'anic or lac, t"ereo# is so!eti!es e@'ressed in O W and so!eti!es in t"e '/c ratios t"e!selves* so i# you co!bine t"e! you $ill "ave a better 'icture o# t"e %real% senti!ent 'icture t"an one or t"e ote"r o# t"e co!'onents* Ai o$e !y insig"ts on gul# bet$een t"e e)uity and inde@ '/c ratios to carl s$enlein and our genial "ost, 'erry*=

Dro!5 deu@sous ATo! Dra,e= Date 6osted5 Se'te!ber 12, 1229 at /I5CF511

EEY TO G3QS A66ROAB-

#au@'as, i&! $it" you in t"in,ing t"ere is ground #or substantial #urt"er advance, but i don&t li,e running u' into t"ese i!'ortant dates i&ve learned to res'ect* as to bisect %t"eory%5 you bisect t"e 'revious range #ro! t"e 'revious range&s 'rior o''osite 'oint to its origin***a 'icture says it better*** so t"e red range is bisected #ro! t"e 'revious to' as its o$n origin $as a lo$* $"en t"e bissect is busted a#ter 'rice started do$n on 3/I, t"e odds $ere Aya gotta "ave #ait" "ere= it $ould go to or beyond t"e 'rior range lo$* li,e$ise since t"e green range is "eaded do$n, you bisect it #or! t"e 'revious lo$ to t"at range* $"en $e started u' #ro! t"e 3//1 lo$ and blasted t"roug" t"e green bisect, t"e odds again #avored ta,ing out t"e 'revious range "ig", $"ic" it did* no$ $e T!ig"tT be "eaded do$n #ro! t"e t"ursday "ig", so $e dra$ a blue range and bisect it #or! t"e 'revious range "ig" as $e are "eading do$n* t"e blue bisect is about /2/3 on !onday&s o'en and 'robably /2/C&is" by $ednesday&s close* since tues/$ed is our ti!eline $e $ould loo, #or su''ort at or near t"e bisect at t"at ti!e* no$,,,,,,$elles $ilder sold t"e C 'oint reversal as reallllly li,ely* i too, t"e course and so did g3* but g3 did t"e researc" 'roving t"at C 'oint reversals are rare* I20 or !ore o# t"e! #ail and are continuations* TTe@ce'tTT at t"e end o# a larger degree e@tended 4 or F 'oint #or!ation $"ere t"e s!aller C 't reversal setu' is t"e cre!e de la cre!e sc"lag on to' t"e desert* ggg i $on&t 'ost it but loo, at t"e daily s'@ #ro! .une F5 /,1,9,4,C 'ts #ro! .une F to august I and $e are in leg F* sooooo $e "ave t"at sc"lag setu' 'otentially $it" a s!aller ti!e #ra!e C 't at t"e end o# an even 't AF and 4 are t"e sa!e=series* t"is is $"y t"e blue bisect bac, #ro! t"is "ig" is sooooooo i!'ortant* #ail t"e bisect and $e could be "eaded to bear "eaven do$n t"ere so!e$"ere* bounce o## t"e bisect t"is $ee, and "ead u' and it&s %o## $it" t"eir "eads% in bearsville* "olding t"e bisect bac, on a ti!e line is ,inda T-E big deal o# t"is a''roac"* it&s a sign o# strengt"* Ag3 is gonna ,ill !e #or s'illing t"is,,ggg=

no$ i "ave a sell signal on t"e bag'i'er Atrust !e=, and !y senti!ent stu## is in sell territory, alt"oug" it could recover a lot o# senti!ent #uel $it" t"ree do$n days* i don&t ENO+ $"ic" $ay it&s going a#ter $ednesday, but i don&t need to $it" t"is stu##* i a! lig"tly s"ort s' #utures and "edged on stoc,s and #unds Abased on t"e bag'i'er, $"o is !ec"anical= until i DO ,no$* one bullis" deal is sla! into or .ust t"roug" t"e bisect on $ednesday&s close and ga' u' t"ursday* but i# it&s reallllly boooolis", $e !ig"t never get do$n to t"e bisect and !ig"t botto! earlier t"an $ednesday&s close,,, t"en it&s a !atter o# .udge!ent5 does it get bac, inside 'oint 9X does it get bac, to t"e little dro' on se't /: to$ard t"e green bisect A%goodbye ,iss%=X t"at ,ind o# stu##* "o'e t"is is a little clearer*
Dro!5 deu@sous ATo! Dra,e= Date 6osted5 Se'te!ber 1/, 1229 at 225245/3 Sub.ect5 !odern elliott $ave

i# you gras' t"e idea t"at /313(43 $as a triangle ending a !assive !ove #ro! t"e !id /3t" century Aan idea !r* elliott "i!sel# $restled $it" #or years=, you !ay recogni<e t"at t"e structure o# t"e !ar,et #ro! /343, even t"oug" it is o# lo$er degree, re)uired a double triangle co!'letion a#ter t"e 1222 to'* i&d "ave to $rite

a boo, to e@'lain it and glenn neely already "as* .ust loo, at t"e c"art $it" #res" eyes* i "ave co!bined t"e count $it" andre$s #or,s $"ic" are not"ing !ore t"an range bisects toget"er $it" 'arallel c"annel lines #ro! t"e range e@tre!es* note "o$ t"e bisects nailed t"e !arc" 2/ lo$ and t"e .uly 21 lo$* t"ese are not !ere coincidences* and note "o$ t"e intersection AY"a''y #ace= o# t$o !a.or andre$s c"annel lines nailed t"e !arc" 29 lo$* i# you "ave a #eel #or elliott $ave rule o# alternation e##ects, you $ill also note "o$ t"e sa!e $ave AA t"roug" E= o# eac" triangle alternates, as $ell as ad.acent $aves o# t"e sa!e triangle* t"is c"art is t"e outgro$t"/e@'ansion o# t"e triangle bear $ave c"art i "ave been 'resenting inter!ittently since /33I "ere and else$"ere* $"y 'resent t"is near a 'otential "ig"X 'artly because i a! .ust a natural contrarian* ggg*** but do loo, at t"e green andre$s c"annel* i# !y $ave count is incorrect, t"e green andre$s bisect is correct* and it did re'el advances #ro! august last year to .anuary t"is year* but t"en it $as blo$n a$ay in !ay/.une* i# !y count is correct, t"e !agenta line bisecting t"e !arc" 21 to october 21 range, #avored by "u!ble and a #e$ ot"ers, is also correct* it re'elled t"e .une 29 and early se'te!ber 29 advances but $as 'ierced in t"e 'ast t$o $ee,s* and no$ $e are 'ausing at t"e green u''er andre$s c"annel line* given t"e scenario #or ne@t $ee, i outlined today and earlier, $e could .ust co!e bac, and test t"e to' o# t"at brea,out !agenta bisect line and accelerate u'$ards* i# t"at "a''ens $e could brea, u' to /1CC A!agenta to' c"annel= or /912 Ared to' c"annel= by t"an,sgiving day* i# not i sus'ect a languid correction bac, do$n to t"e red lo$er c"annel at Z3I2(32* #or #ans o# recycled 'rec"ter and traditional s/r #ans, t"is $ill see! i!'robable to a degree or t$o* but i# you #ollo$ t"e dyna!ics and logic o# !ar,et 'rogression, you !ay li,e it* 6S5 t"ere are no ti!ing lines on t"is c"art* (((((((((((((((((((((((((((((((((((((((((((((((((((((((((((((((((((((((((((((((((( $"y not use a ti!e interval $"ic" "as an e)ual nu!ber o# !inutes 'er unitX li,e t"e stoc, !ar,et in t"e US !ar,et trades #or F //1 "ours or 932 !inutes a day* 932/F2 G ,,,,,,, ot"er$ise so!e bars are de#ective in ti!e and t"ere#ore distort ti!e/'rice studies li,e trend lines* $"y s"ould a 92 !inute bar stand side by side 'roudly $it" a F2 !inute barX 932//C G 1F 932/92 G /9 932/FC G F 932/:I G C 932//92 G 9 932//3C G 1

S'ecialist S"ort Ratio


Dro! a longer(ter! 'ers'ective, a S'ecialist S"ort Ratio t"is lo$ indicates t"at t"e long(ter! bullis" signal triggered by t"is indicator bac, in >une o# 1221 $ill re!ain in e##ect #or )uite 'ossibly all o# 1224* # you&ll recall,

>une o# &21 $as t"e #irst ti!e t"e S'ecialist Ratio #ell under 9C0 a#ter trading above 4C0* +"en t"e S'ecialist S"ort Ratio #alls belo$ 9C0, it&s a bullis" sign #or stoc,s because it !eans t"at t"e 'ublic is "olding an unusually "ig" a!ount o# o'en s"ort 'ositions* And since t"e 'ublic is usually $rong in t"eir o'inion, t"ere&s a !uc" better t"an average c"ance $e&ll see t"e SP6C22 trading "ig"er by t"e ti!e t"e S'ecialist S"ort Ratio rebounds into !ore ty'ical territory* -istorically, $"enever t"e SSR dro's belo$ 9C0, it&s been a clear buy signal #or t"e stoc, !ar,et on a longer(ter! basis* Long 'ositions are "eld until t"e SSR rises above 4C0, signaling t"at o'en s"ort 'ositions are !oving #ro! t"e unin#or!ed 'ublic bac, into t"e "ands o# t"e s'ecialists As!art !oney=* All occurrences o# t"is signal since /3I2 are listed belo$* Note t"at t"ere "as never been a losing signal* Cong3term (H, Timing with the (pecialist (hort +atio @BG$"G@$ ;uy 2A2."%... >,'N @2G$AG@" ;uy "@K@.AK... "@G"$G@" (ell "@2".B1... MK.2L @AG$BG2K ;uy K4%.A@... @4G"AG24 (ell 2"1.%@... M2%.$L @1G$AG2% ;uy K1@.$"... @"G@4G2K (ell KB2.2@... MK.KL @1G$2G2$ ;uy K"1.%1... @$G"2G2% (ell K%K.$$... MK.1L ""G$2G2" ;uy %41.$$... @"G"@G2$ (ell K"1."@... M"@.BL @1G@KG2@ ;uy %%A.%2... @BG"KG2" (ell %A$.$2... M"%.@L @KG"1GAA ;uy $12.44... @1G"2GA2 (ell %$".$K... M$%.4L "@G$%GA4 ;uy $KA.$$... ""G@BGA4 (ell $1@.K"... M@.2L @"G"BGA4 ;uy $BB.$A... @$G@BGA4 (ell $A@.@K... M1.$L "@G"4GAB ;uy $%A.AK... @"G@$GA4 (ell $KB.K1... M%.$L @2G"KGAK ;uy "BA.4A... @%G@4GAB (ell $$1.14... M%%.BL @2G@2GA% ;uy "BB.2$... @AG$KGAK (ell "B4.1"... M@.KL "@G@2GA" ;uy "$".K1... @2G"4GA$ (ell "$$.11... M@.2L 7long similar lines# while specialists are holding a near3record low level of shorts# the 'public' is holding a near3record high level of shorts. 0hen the public has loaded up on short positions in the past# it's typically preceded a rally in stoc)s# reinforcing the fact that the public is invariably on the wrong side of the mar)et. For e?ample# the ,ublic (hort +atio (,(+)# which is simply all shorts held by the public divided by total outstanding shorts# is currently running at a high 1BL. &n the table below# &'ve listed every instance over the past decade in which the ,ublic (hort +atio hit 11L# followed by the performance of the (H,1@@ until the ,(+ fell bac) to 1@L or less. &n other words# we want to see how the stoc) mar)et performs when the public turns overly bearish and holds more than half of all short positions. 7s you can see# it's typically been a much better idea to fade the public when they've turned this bearish in the past... Dro!5 daNc"ei# Adon $olanc"u,= Date 6osted5 >anuary 2/, 1224 at /959C54F Sub.ect5 s'ecialists NYSE 7E7;ER NET ;UY/SELL5 As a rule NYSE !e!ber #ir!s are net sellers o# stoc,* 0hen they are net buyers three or four wee)s in a row# an intermediate3term rally is li)ely. 7e!ber Net ;uy/Sell W /222**5

/1//1 /1/2C ///1I ///1/ ////4 (((((((( (((((((( (((((((( (((((((( (((((((( [3I:1 [I:C4 [C22 [1:99I (9FFI3 Aand t"at doesn&t include t"e ///: $ee, $"ic" $as [C42,222 @ /22288 one o# t"e largest i&ve seen=* NYSE S-ORT NTEREST RAT O5 s t"e total outstanding s"ares sold s"ort divided by t"e average daily volu!e #or t"e last !ont"* 7 value greater than 1.@ is bullish because it reflects e?cessive pessimism and represents potential demand if the mar)et rises causing short sellers to cover. ;ullish readings tend to lead the mar)et by several wee)s. T"e reading as o# /1//C/29 is C*:2, $"ic" is ;ULL S-* NYSE S"ort nterest Ratio***5 /1//C ////C /2//C 23//C 2I//C (((((( (((((( (((((( (((((( (((((( C*:2 C*92 C*C2 C*I2 C*F2 colby * * Tue, 2ul 35, $%44BM (T ***"ere is a little "el' i# you #eel li,e acce'ting it***loo, at a 9!in c"art $it" !acd 19(93(/9 and i# t"e blue line is above t"e red line dont s"ort***5= real si!'le**** real good****** colby * * Tue, >ul 92, 454967 ET D+ + F2 !in stu## s"ort at t"e close*** colby * * T"u, Aug I, C52/67 ET be#ore leave F2!in still on buy ****S6W,DO+,BO76W,OEW all above t"e F2!in /12e!a****T"e RUT is .ust no$ co!ing u' to it**** Bolby (/2 !in RS F divergence bet$een 4 and :a! colby * * Tue, Se' /:, /154967 ET t"ose sting "ere $"o ,no$ $"at use c"ec, t"e /2!in $it" RS and t"e 9 !in !acd***
col y . . "ri, Sep 4#, D%$4BM (T look at a 65min chart with 6 )SI...it nailed the top of that mo!e..*&T( T+( *(G 9I'()G(*F(PPP

Fol y?s preferred MAF9 time freCuency $35 min

T&99&% T"e settings on !y stoc"astics is5 ,G1/, dG3 and


!inute*

use a C(!inute and a 142(

*&T(% &ST()F ,I:(S T& ;S( #4MA &* $5 MI*;T( F+A)T "&) S;BBJ)(SIS>>>A,S& ;S(S #4 &* 65, alsoon 35 minute
parrotlady . . "ri, *o! 44, $%53BM (T today is certainly a IscalpingI day....<ust playing the 3D>ma> > ands on a 5 minute chart is the only way to make any money.....

neurotrade*** T"u, Deb 12, 35C9A7 ET "ave a nu!ber o# osc on t"e /C !in NDW **.ust #or a )uic,ie loo,, since !ost trade is at close but nice to ,ee' eye intraday **Dor t"e si!'le 7ABD on /C NDW, use /9(1C(/9 7AB- turns on /C as $ell as ot"er osc, best as $e near /25/C**/2592*****/15C2 A/5/C= **1542[/( etc etc

F7+& .7MN'& E('( "1 M&NET' ;7+( >NCO &)e &ossif uses short term("3%days) "B@ simple m.a. on "1 minute bar chart# if price brea)s chart is signal#best signal brea) and retest ma and fail at m.a. uses $@#1@#"@@ maJs on bollinger bands# e.g. on B@ minuteP1@ma. Coo) up AROON OSB LLATOR Qstoc)charts.comGeducationGresourcesGglossaryGaroon.html
2/452/519 \Dari] /1,2 i use :92 P //92 6TG/2592 and 1592 et 2/452/519 \Dari] /1,2 t"e o'ening "our (( retail trades 2/452/519 \Dari] /1,2 //92 6T is dyna!ic !argin calls 2/452/519 \Dari] /1,2 and last "our is 'ros 2/452/519 \Dari] /1,2 re!e!ber, c"arts are rear vie$ !irrors

parrotlady... Fri# Feb $"# @!$@7M 'T & Rust want to let you all )now that & am about to have my password cancelled....as soon as & hit send on my email. &t's been an interesting seven years. &'ve learned a lot from a lot of people....especially people li)e >leman and .umble with much of his good old fashioned mar)et savvy and many insights such as his +ichard Dennis sell signal. 7u revoir.
psycnosis . . Thu, *o! 4$, 5%56BM (T I ha!e een using the 3min with MAF9 and a #4MA and it has een doing well. Bretty easy long a o!e short elow. ,ol

'arrotlady*** T"u, Se' /3, /15C267 ET don&t use !any indicators but been $atc"ing sto&s $it" a 3*9* setting on /C !in c"art******it&s been real good 'arrotlady*** T"u, Se' /3, 954467 ET((+EDGES trouble $it" t"at $edge t"oug" is $e "ave already gone to #ar into t"e a'e@****so it 'robably $on&t $or, t"ey don&t usually $or, i# 9/4 o# t"e $ay to t"e a'e@ is e@ceeded* t$ocents*** T"u, Se' /3, 954I67 ET '/l, t"at is #ascinating* neely di##erentiates bet$een li!iting and non li!iting triangles along si!ilar lines, i*e* "o$ #ar into t"e a'e@ calendar*** T"u, Se' /3, 95C967 ET %T"e #art"er out into t"e a'e@ o# t"e Triangle 'rices 'us" $it"out bursting its boundaries, t"e less #orce or 'o$er t"e 'attern see!s to "ave% ^/34I Ed$ards P 7agee 'arrotlady * * Sat, Oct /3, I5C167 ET as #or trin or anyt"ing #or t"at !atter, .ust don&t 'ay !uc" attention to anyt"ing t"at "a''ens be#ore /2592 "ave al$ays #ound $it" tic, and trin t"at using a c"art ***** use a /C !inute c"art $it" bollinger bands and a 1/ !/a on bot"****tells a lot !ore t"an any absolute #igures*_bb 'arrotlady * * Dri, Nov /, 459467 ET On t"e s'@ daily t"e CC e!a "as been su''orting and t"e I3 e!a resisting #or // days no$* T"e crossover is t"e ,ey*****$"en t"ey cross, t"e !ove $ill be "uge, 'arrotlady * * Dri, Nov /, //59:A7 ET $atc" t"e CC e!a and t"e I3 e!a #or crossovers********** 'arrotlady*** +ed, Nov 1:,1221 :54:67 ET t"e CC e!a on t"e s'@ $ee,ly "as controlled all t"e !a.or rallies since $e #irst turned belo$ it******** doubt $e )uite !a,e it to it t"is ti!e****and it certainly isn&t turning u'* 'arrotlady * * 7on, >an F,1229 /154F67 ET T"is $ill 'robably be li,e t"e $ee,ly s'@ c"art $as in >anuary and 7arc"* Touc"ed t"e 94 s!a in >anuary but t"e do$n !ove $asn&t ready until in rallied to t"e CC e!a* T"at CC e!a on t"e $ee,ly c"art "as been !agic since t"e bear began*

athbo... at, 4ct ", !!:#(3M &T

GA6S ;Y OLE7AN You gotta ,no$ $"at t"e trend is in t"e ti!e#ra!e you&re trading* A ga' belo$ a rising 7A sets u' a buy, es'ecially i# you sell o## i!!ediately into t"e /25/C(92 ti!e #ra!e* A ga' above a rising 7A t"at does not brea,do$n be#ore /2592 !eans bull day* Ga' above rising 7A t"at brea,s u' out o# t"e range o# t"e #irst 12(92 !inutes, !ust be boug"t rig"t t"en or it gets a$ay* S'ea,ing in all cases o# ga's o# greater t"an 9 "andles* Al$ays loo, #or a reason to buy big do$n ga's early* T"ey usually give you a good early "it, even i# t"e sell is on*

ga' u' and close #irst /C !in above t"e last !a.or u's$ing Aor days "i= o# t"e day be#ore !eans ;ULL day* Ga' above 'revious "i or last !a.or u's$ing and dive #irst /C !in or so !eans early colla'se* AREOERSE #or do$n days= Ga's can su''ly you $it" a good living i# 'ro'erly understood*
ts an old conce't((used by !any $riters #or :C years or so* t !eans a !ar,et t"at goes no$"ere(((no rally, no sello##* # t"e !ar,et %dra$s a line% #or t"e #irst "our a#ter ga''ing u' a cou'le "undred 'oints or so, buy it at /2592* You&ll get a 'ro#itable !ove be#ore / '*!* I20 o# t"e ti!e* You !ay not close "ig"er, but you&ll get a tradeable rally* Ole!an says on a ga' u' day and t"e ga' "as not #illed by /2*92 buy t"e ne@t u' bar a#ter /2*92 bt$, ga' above t"e "ig" o# a DO+N day t"e day be#ore "as been a 'retty good buy* /220 #or t"e decade*5= On a ga' u' o'en, i# it !oves u' #ro! t"e o'en, it&ll reverse on t"e 9rd or 4t" bar 320 o# t"e ti!e, i# its going to

reverse at all* # it ga's u' and dra$s a line, i# it dont brea, do$n in an "our, it&ll go 'ro#itably "ig"er* T"at&s all you need to ,no$* T"e rest is u' to you* # t"e !ar,et continues to !ove in t"e direction o# t"e ga' #or at least t"e #irst 1, C !in bars, you ,no$ by 35C2 $"et"er you&re going to "ave a reversal* # it ga's u' and dra$s a line, you ,no$ by /2592* +"en it ga's u' and t"e #irst 1 bars are DO+N, buy it i# it brea,s above t"e o'ening range during t"e #irst "al# "our* T"is is #ro! B" /9 o# Trader Oic&s second boo,* # it ga's u' and runs u' #or /2(12 !inutes, A1(4, C !in bars=, and reverses and you DON&T sell it, You #lun, t"e course* T"e easiest $ay to 'lay t"e ga's is5 Loo, at a 92 !in c"art $it" a 92 bar !a* Any ga' o# !ore t"an a cou'le "undred 'oints AGA NST t"at trend is a #ade* T"e bigger t"e better* DO NOT #ade ga's in t"e direction o# t"e trend* ;uy t"e! $"en t"ey go above t"e #irst "ours range, no !atter "o$ "ig" it is* T"e TREND is all t"at !atters "ere, as in !ost t"ings*
oleman . . -ed, 2ul 4D, .%4DBM (T

I watch the 5 and $5, with the 35 min and day trends clearly in mind. Barrot lady taught me to go to the one minute when my target was eing approached. I prefer a com ination of $5 and 3D MANS on all time periods less than weekly.1e.g. $5 min chart, wit oth $5 and 3D MA on it7 So why the $5MAO I see the 3D holds the trend ut what is the $5 used forO It <ust helps me !isually. A reminder of the strength of the trend as it approaches or crosses or runs away from the long MA......&n weekly, I use $5,55. 8ut I trade off support and resistance. MA?s tell you what the trend is in the time period of the MA. SJ) tell you where price is going to pause, re!erse, or continue. +ope$ said that today. I?!e said it for years. &yster has shown o!er and o!er how to trade it.
oleman... Mon, "e 4D, 6%36AM (T M(8&8 );,( -hen the market has eenin consolidation for se!eral days, IMe o I is apt to start a run of success tha tlasts for se!eral days. -hen the market has een directional for se!eral days, it is apt to start a run of drawdowns. It is the nature of the east. -hen the market has eenin conslolidation for se!eral days, A*= system that gi!es signals during the a.m. will make money. And !ice!ersa%7
oleman... -ed, &ct $6, 6%5DBM (T A pure )SI swing system will perform accepta ly. A )SI swing system sith a couple rules will put the arrows relati!ely close to where neuro?s system puts them. I watch neuro?s stuff ecause I trade the $>5 day swings most of the time, and his stuff IS good. +is signals are might close to all the right places. the )SI, used properly, is a real tool for making KKK. i use oth a 5 and an 6 day a!erage>>>different time periods. oleman... -ed, &ct $6, 6%$.BM (T ack in ?.# I offered to et 4c that I could trade a chart with price lacked out, showing only the )SI and e profita le after a certain num er of trades>>>I think it was 5. +e thought a out it for a while and agreed. There was no et. +adnt seen it tawked a out that much as a stand alone system till that site I <ust linked here was posted. I dont use it as a stand alone, ut,as I ha!e posted here many times in the old days , I

use only one indicator and one MA>>>and some straight lines>>>in my swing trading.

The record posted on that site is legit. And you can do a lot etter, with a little tweaking and Igoing oth waysI. 8ut it is too simple for most fokes. http%JJwww.!toreport.comJrsi.htm oleman... -ed, &ct $6, 6%46BM (T 8ack then>>> efore your ad!ent here, I think>>>I said that if you ga!e the holy grail to e!eryone on the site, most of them would still die roke, ecause they would ne!er e a le to enter and e0it when they should.

#hat-s true because the right move is almost always contrary to what we 7AC# to do It is >#I++ true They will go on looking, losing, and paying IGurusI and throwing pies at the
ones who freely gi!e them the ait with which to fish.

a45554#... -ed, &ct $6, 6%55BM (T onds are easy to trade.. <ust take the !alue 5 days ago and su tract it from current !alue and plot.. if you can?t make money after looking at the resulting trace you need to e in another usiness.. oleman... -ed, &ct $6, .%5DBM (T a4% =our 6%55 descri es the mathematical asis for an indicator called I)&FI )ate &f Fhange. 'ery similar to )SI, in fact. And, yes, you could us it and trade the ond without looking at price.
oleman... -ed, &ct $6, .%$.BM (T a45% A sample rule% -hen price is a o!e a rising 35ema, uy the ond when the 5 period )&F closes under $.5. Take profits when )&F5 closes a o!e W4 oleman . . -ed, *o! 45, $$%33AM (T A simple system like that of Gary Smith, with a couple refinements, that gi!es you the opportunity top make money e!ery day with no o!ernite e0posure, ut without the stress of watching e!ery little sCuiggle. The only daytrading system I e!er knew of eing pu lished in a ook with rokerage statements pro!ing profita ility o!er a multi>year period 8ack efore F*8F, Gary S used to watch "** for an hour e!ery morning, then put his stop order in for entry. If filled, he checked it e!ery hour and mo!ed his trailing stop. +e didnt work real hard.%7 oleman . . Thu, *o! 4$, 6%56AM (T "rom neuro?s chart ytd, Ithe signal will come....the higher the etter.I There is a )(AS&* why neuro has a pu lic record of making money, e!en in the most difficult1for his mindset7market conditions....+e understands......The uy low, sell highI guys come and go around here.

The I8uy high and sell higherI type <ust seem to go on like the (nergiEer 8unny.%7
8uying reakouts is a dangerous game. Great ma<ority of them are "A9(S. That is not what I mean y I8uy high and sell higherI. ,ike oyc, I like to trade the I&ther sideI of them..... notop... Thu, *o! 4$, 3%45BM (T uy high and sell higher as in testing a rising ma from a o!eO oleman... Thu, *o! 4$, 3%46BM (T To illustrate% If the reakout at

ll%55am is !alid, then the pull ack at $4%35 is T+( uy.

oleman . . "ri, *o! 44, .%35AM (T een tawkin a out trading against swing highs and lows here for 6 years. That?s why I recommend 8 -illiams stuff to new ies. +idden in his mountains of 8S, is the holy grail of swing trading. *euros ** gi!es signals which are !ery close to my own signals, and the reason is that,whether intentional or not, he is enteringJe0iting near those points. ;sually early, ut he?s there.

oleman . . "ri, *o! 44, .%DDAM (T And, for the intra>day folks, <ust look and see how many mo!es (*9 with a high !olume ar that prints a o!e or elow the pre!ious sJh or sJl............. and it shows all the way down to the $ minute chart.........

& will say that stressing over each and every tic) isnJt productivePor healthyS The goal# as always# is to get to the point where you can view prices as opportunity TODD -ARR SON
9ate Bosted% Septem er 53, 4553 at 44%35%54 Su <ect% )e% There?s ulls, ears ut ,ean +ogs is an o0ymoron

4::O*:: lows were +@>> than the prices in 4:4:K a famous avid trader whom many here will know, oleman, loaded up on hog futures calls into that low and made a fortune
http%JJwww.hardrightedge.comJwiEardJtl$.htm

speaking of lean hogs,,,,,the

In the early days of the Internet, efore the e0plosion of financial information related to the current mania,
there were few places where traders could e0change information outside of the rokerage usiness. I stum led upon the A!idTrader site and they had a free chat line. I hung around there for a long time and one day, a gentleman using the handle IolemanI, an SLB futures trader, came into the site. -e ecame regulars on the site and at some point, I sent him an email, asking him a out his methods. +e replied that he traded like "orrest Gump.

+is asic logic went something like this% 7e are told to buy low and sell high 7e are told

to follow the trend #hese would appear to be mutually exclusive at first glance #he only way to make these two statements reconcile is if we change it to !buy high, sell higher! or !sell low, buy back lower! I was struck dum y the power and the simplicity
of his idea. It was as if I had sailed for a lifetime on the open ocean e0pecting to fall off the edge and suddenly disco!ering that the earth was round instead. Berhaps it was like the moment when the apple fell on Isaac *ewton?s head and he Idisco!eredI gra!ity. Suddenly it all ecame clear to me. I was free. ,et?s get technical. What is an uptrendF What is a downtrendF ?ictor perandeo, in his first book, Trader ?ic/ Methods of a Wall treet Master, defines it perfectly: ;pward Trend / 3n upward trend is a series of successive rallies that penetrate previous high points, interrupted by sell/offs or declines, which terminate above the low points of the preceding sell/off. 6n other words, an uptrend is a price movement consisting of a series of higher highs and higher lows. 9ownward Trend / 3 downward trend is a series of successive declines which penetrate previous low points, interrupted by rallies or increases which terminate below the high points of the preceding rally. 6n other words, a downtrend is a price movement consisting of a series of lower lows and lower highs. This is simple enough ut .5 percent of traders pro a ly couldn?t tell you off the top of their heads. 4nce we know the definition of uptrend and downtrend, we are already ahead and on our way. The ne9t thing we need to do is to draw a trend line correctly. 6t becomes a game of connect the dots. perandeo continues: I"or an uptrend within the period of consideration, draw a line from the lowest low, up and to the highest minor low point preceding the highest high so that the line does not pass through prices in between the two low points. &9tend the line upwards past the highest high point. 6t is possible that the line will go through prices past the highest minor high point. 6n fact, this is one indication of a change in trend, as will be demonstrated shortly.< I"or a downtrend within the period of consideration, draw a line from the highest high point to the lowest minor high point preceding the lowest low so that the line does not pass through prices in between the two high points. &9tend the line past the lowest high point downward.<

Armed with the definition of uptrend and downtrend &leman said that in his trading he would uy e!ery
dip on the way up and e wrong once at the top, whereupon prices would fail to make a higher high. And on a downtrend, he would sell e!ery rally and e wrong once at the ottom when it would fail to make a lower low. +ow much simpler could it eO It sure eat what I had seen eing done y the desk traders and retail clients all around me, namely, uying e!ery lower low trying to catch the ottom and then shorting each higher high to try to get a top. These people were trading their egos. I thought it would e a good idea to <ust trade like "orrest Gump and make money instead. I did not press him further for he had parted with a real gem. +e did say something a out using A!erage True )ange. I did not think it was right for me to ask for more handouts. It was time for me to find a way to employ this fundamental truth. The secret was so simple and so correct. I had indeed missed the I"orrestI y getting too close to the trees. My mission was defined. 6 already knew how to take my losses :uickly but 6 was not too elegant in my approach. 6 wasn*t great at letting my profits run because 6 had the trader*s version of permanent post/traumatic stress disorder caused by the @rash of *-2. 0irst, 6 would go back to my pile of books to find methods of identifying uptrends and downtrends. econd, 6 would find ways to identify and buy each dip on an uptrend and to sell every rally on a downtrend. 4ut of those ideas, 6 could find better places to put stop loss orders and find ways to use stop loss orders to alleviate my an9iety when 6 was up on a trade

A377
Gann !ery specifically said in his courses to use T9?s for angles, ut use F9?s for time cycle work. If you look at his famous ean chart, it was drawn in T9?s. =et his sCuare of . charts are o !iously in F9?s. To me, that difference is one of the mysteries of Gann.

Turtle Trend
The Turtle Trend is a filter de!ised y the Turtles to help them trade with the trend. As opposed to the swing trends that I list, the Turtle Trend is ased on 459 line changes. As you pro a ly know the Turtles trade !arious commodities using a 459 9onchian reakout system. If you use that system without a filter, the drawdowns can e se!ere. The Turtle Trend is up if the last 459 reakout up is a o!e the last 459 reakout down or if the last 459 reakout down is a o!e the last 459 reakout up. ,et me illustrate with the SBH. The SBH roke out a o!e 459 highs on 3J$#J53. That was a Turtle uy signal. The reakout point was 65DJSBH. The ne0t 459 reakout down occurred on #J$J53 at .63JSBH. That is a o!e the pre!ious reakout up at 65DJSBHQ so the Turtle Trend is up. The ne0t 459 reakout up occurred at $555JSBH. That is a o!e the reakout down at .63JSBH so the trend continues up. The ne0t 459 reakout down would occur at .#4JSBH if it were to occur tomorrow. If that were to happen, the Turtle Trend would turn down ecause it would occur elow the pre!ious reakout up at $555JSBH. +owe!er, IM&, it is more likely that y the time the 459 line turns down, price will e a o!e $555JSBH and the Turtle Trend will remain ;p. *ote how this Turtle Trend filter would ha!e kept the Turtles from selling the reakout down on #J$, ut would ha!e had them uying the reakout up on 6J4$ at $555JSBH. Borter If you really want to e0plore it in depth, you might want to get a hold of some of the Turtles material. 8ut I?ll try to e0plain their system for free. %7 I use the terms 459 line change and 459 reakout interchangea ly. -hat is meant is the the last 45 ars to the left are roken a o!e for a 459 line change up or elow for a 459 line change down. The Turtles enter on the reakout and place a hard 4* stop where * eCuals the A!erage True )ange o!er * days 1$5>$D days works fine7. If the reakout is on the upside they then trail a stop elow the last 459 range.

If the Turtle Trend changes to down they will stop and re!erse when the 459 range is roken elow. If the Turtle Trend is still up they will merely e stopped out. If you can grasp those simple concepts, ask me again and I will e0plain the Turtle Trend in more detail. ,et?s assume that you ought a 459 reakout up. Then when the ne0t 459 reakout down occurs you will e0it the position. If the trade shows a profit, the Turtle Trend is up, and you will not short. If the trade shows a loss, the Turtle Trend is down, and you will go short. 8T- Turtle Trend is my nomenclature. A etter description is a BrofitJ,oss filter.

Dro!5 deu@sous ATo! Dra,e= To5 'orter A6orter >o"nson= Date 6osted5 Se'te!ber 2C, 1229 at /352F5C9 t"an,s, 'orter* i $as t"in,ing about ric"ard dennis and donc"ian t"e ot"er day *

$e !ay be bac, to an era in $"ic" brea,outs $or, as t"ey did #or dennis in t"e :2&s*
i didn&t 'ay any attention to t"e turtle(!ania !ar,eting blit< since t"ings c"anged a#ter /3I2* i "ad #orgotten all about it* it "as so!e c"aracteristics o# t"e reverse 'oint $ave and bag'i'er syste!s, and is very si!'le*

3; GA+6@C /?+@> DA/ #/A6@/> 7ant to trade successfullyN $ust choose the good positions and avoid the bad ones "oor trade selection takes a heavy toll as it bleeds your confidence and wallet Jou face many crossroads during each market day 7ithout a system of discipline for your decision*making, impulse and emotion will undermine skills as you chase the wrong stocks at the worst times ,any short*term players view trading as a form of gambling 7ithout planning or discipline, they throw money at the market #he occasional big score reinforces this easy money attitude but sets them up for ultimate failure 7ithout defensive rules, insiders easily feed off these losers and send them off to other hobbies #echnical Analysis teaches traders to execute positions based on numbers, time and volume #his discipline forces traders to distance themselves from reckless gambling behavior #hrough detached execution and solid risk management, short*term trading finally !works! ,arkets echo similar patterns over and over again #he science of trend allows you to build systematic rules to play these repeating formations and avoid the chase:

4 Dorget the news, remember the chart =ou?re not smart enough to know how news will affect price. The chart already knows the news is coming. 3 &uy the first pullback from a new high >ell the first pullback from a new low There?s always a crowd that missed the first oat. 5 &uy at support, sell at resistance (!eryone sees the same thing and they?re all <ust waiting to <ump in the pool.

G >hort rallies not selloffs -hen markets drop, shorts finally turn a profit and get ready to co!er. 5 6on-t buy up into a maEor moving average or sell down into one See X3. 6 6on-t chase momentum if you can-t find the exit Assume the market will re!erse the minute you get in. If it?s a long way to the door, you?re in ig trou le. H @xhaustion gaps get filled &reakaway and continuation gaps don-t The old traders? wisdom is a lie. Trade in the direction of gap support whene!er you can. O #rends test the point of last supportPresistance (nter here e!en if it hurts. : #rade with the #IB< not against it 9on?t e a hero. Go with the money flow. 4; If you have to look, it isn-t there "orget your college degree and trust your instincts. 44 >ell the second high, buy the second low After sharp pull acks, the first test of any high or low always runs into resistance. ,ook for the reak on the third or fourth try. 43 #he trend is your friend in the last hour As !olume cranks up at 3%55pm don?t e0pect anyone to change the channel. 45 Avoid the open They see =&; coming sucker 4G 4*3*5*6rop*?p ,ook for downtrends to re!erse after a top, two lower highs and a dou le ottom. 45 &ulls live above the 3;; day, bears live below Sellers eat up rallies elow this key mo!ing a!erage line and uyers to come to the rescue a o!e it. 46 "rice has memory -hat did price do the last time it hit a certain le!elO Fhances are it will do it again. 4H &ig volume kills moves Flima0 low>offs take oth uyers and sellers out of the market and lead to sideways action. 4O #rends never turn on a dime )e!ersals uild slowly. The first sharp dip always finds uyers and the first sharp rise always finds sellers. 4: &ottoms take longer to form than tops "ear acts more Cuickly than greed and causes stocks to drop from their own weight. 3; &eat the crowd in and out the door =ou ha!e to take their money efore they take yours, period.

(0ploiting Market Yuirks )e!ersals at the first test of a new high or low are common. In!estors <ump out at dou le tops after missing the first e0it while !alue players uy dou le ottoms. Skilled traders also use this known re!ersal tendency to enter counter>trend positions.

Markets in!aria ly return to test prior support or resistance unless a natural arrier 1such as a continuation gap7 stands in the way. 8esides price and pattern, common mo!ing a!erages also pro!ide classic swing re!ersal points.

"rom% g. 1Ste!e Goodwin7S+IS T(F+*IY;(S


9ate Bosted% &cto er 44, 4554 at $5%46%5$ The mkt is an e!er dynamic en!ironment, so you need tools and methods that gi!e you the cause and proof of mkt mo!ements. This allows you to adapt to the dynamic nature of the mkt with greater certainty when it stops a few handles or a few hours either side of your eliefs. Mkt mo!ements uild themsel!es ased on their own geometry and initial price shocks, each nested within the larger mo!ements. 9on?t get fooled y early or late, lower or higher, <ust pro!e the mo!e is o!er and start analysing the ne0t mo!ement as it unfolds. "-I-, I lea!e holidays in when counting tds.

OSB LLATORS ale@Ngrace 7ost traders are so involved $it" t"e s"ort ter!, t"ey do not see t"e big 'icture $"ic" is t"e true direction o# t"e !ar,et* No$ co!es t"e ,ey 'oint o# t"e entire e@ercise* T"e 'oint is to al$ays trade $it" t"e trend* So $"at is t"e cleanest $ay to #ind t"e trend o# any !ar,etX ;y loo,ing at t"e longest ti!e #ra!e o# any !ar,et #irst, you $ill t"en "ave t"e 'ro'er direction* Any !ove t"at is against t"e !a.or trend is a counter trend !ove* T"is is suc" an i!'ortant 'oint because all o# t"e sur'rises co!e in t"e direction o# t"e !a.or trend* Rising !o!entu! !eans t"at t"e curve o# t"e oscillator is 'ointing "ig"er, and i# itQs above t"e <ero line it is gaining u'$ard !o!entu!* T"e sa!e is true i# t"e inverse "a''ens* T"at is, it indicates a decrease in u'$ard !o!entu! above t"e <ero line, .ust as an increase in do$n$ard !o!entu! s"o$s $ea,ness belo$ t"e <ero line* ;y using an oscillator, t"is gives you t"e advantage o# "aving so!e advance notice in a 'otential 'rice c"ange be#ore it actually occurs* ;e#ore 'rices can c"ange direction, t"ey !ust lose !o!entu! #ro! t"e direction o# t"e !ove in t"e sa!e !anner t"at your car !ust co!e to a co!'lete sto'* n t"e $orld o# oscillators, t"e crossovers in t"e oscillators are t"e ,eys s"o$ing t"at direction is about to c"ange* T"is is $"ere t"e se)uencing o# oscillators co!es into 'lay* T"is is t"e reason t"at use !ore t"an one ty'e o# oscillator5 To ta,e t"e $"i' sa$ out o# t"e direction o# t"e 'rice !ove and to give !e con#or!ation o# t"e trend* T"e Slo$ Stoc"astic is t"e early $arning signal $arning you t"at you are at or near a botto! and you s"ould e@'ect a c"ange in t"e direction o# 'rices anyti!e*
uptown6 . . -ed, 2ul $#, 3%D6BM (T I elie!e Titan and 'elocity are 455/ ull funds and Tempest and 'enture 455/ ear funds. *o!a is $.5 sp0 )yde0 ;rsaM earO madrone$Zsw ell.net

t$ocents * * Tue, Se' /:, /5/467 ET GOLD STOBES !iners* bro,en "ill/billiton, angloa!erican, rio tinto, #ree'ort golod P co''er* good long ter! & Dro!5 bigdog1C32 Anorral rat"an= Date 6osted5 >anuary 21, 1229 at 2C5C4594 !y #avorites are ASA RGLD and GSS

Eno$ T"ysel#
+e&ve been trading #or a long ti!e no$, and $e&ve #igured out t"at t"e ,ey to success#ul investing is not great syste!s, or brilliant analysis, but 'syc"ology* # you t"in, about it, t"ere&s got to be a reason $"y a $"ole bunc" o# s!art guys and gals are buying stoc,s rig"t at t"e !ar,et&s to', and $"y t"ere&s a $"ole bunc" o# s!art guys and gals selling rig"t at t"e botto!* T"at reason, !ost li,ely, "as to do $it" t"e !ere #act t"at t"ey "ave a #eeling o# security going along $it"

ot"ers $"o also "ave good reasons #or buying or selling at t"e absolute $orst ti!e* # $e are to be success#ul investors, and i# $e "o'e to serve our clients $ell, $e "ave to #ind $ays to !a,e sure $e aren&t being lulled into doing t"e $rong t"ing at t"e $rong ti!e #or 'syc"ological reasons* T"e best $ay to do t"at is to #ind our o$n $ea,ness and to structure our business or our trading disci'line to avoid t"at one $ea,ness* Since $e&ve li,ely ta,en great 'ains to co!'ensate #or t"at $ea,ness, i# $e can avoid t"e da!age t"at t"at $ea,ness causes, our 'er#or!ance can be stellar* t be"ooves all o# us to e@a!ine our #ailures closely* Let&s loo, at our bad trades and see i# $e can deter!ine a 'attern* Do $e #ail to 'ull t"e trigger, 'assing on great trade ideasX Do $e "ang on to losses too longX Do $e !arry an idea, and "ang onto it long 'ast its use#ul li#eX Once $e deter!ine our $ea,ness, t"en $e can na!e it* # $e can na!e it, $e can ta,e ste's to avoid it* 7 NE S TAE NG 6ER OD B 7ASS OE LOSSES +- B- + 6E OUT ALL 6REO OUS GA NS888 GET ANGRY AND BANQT TAEE STR NG OD S7ALL LOSSES S USUAL SETU6 TO D SASTER** R B-ARD RUSSELL`OBTO;ER 1221

0hen dealing with the mar)et# it's no shame to be wrong. The real sin is to (T7O wrong (which is always an ego problem). . .
Russell began 'ublis"ing Do$ T"eory Letters in /3CI, and "e "as been $riting t"e Letters ever since Anever once "aving s,i''ed a Letter=* Do$ T"eory Letters is t"e oldest service continuously $ritten by one 'erson in t"e business*

% # you are reluctant to sell, you are ty'ical o# A!erican investors, $"o sell t"eir $inners and ,ee' t"eir losers,% $rites Levy* % nvestors do t"is because t"e act o# selling at a loss is an ad!ission t"at t"ey $ere $rong*% % tend to do t"e o''osite,% "e says* % disli,e $atc"ing !y losers $ee, a#ter $ee,, and i# sell t"e!, get a ta@ loss to o##set ca'ital gains*% one o# 6esavento&s little stories really li,e**** % n t"e 'ast t$o decades #e$ traders "ave e@'erienced
t"e success o# 6aul Tudor >ones8 7r* >ones e@'loits in t"e !ar,ets "ave reac"ed t"e legendary status t"ey deserve* 7y #avorite tidbit is #ro! an article in t"e +all Street >ournal $"en "e $as intervie$ed on "is trading* T"e re'orter $as very e@cited by 6*T*>*Qs recent success in t"e Treasury bond !ar,et* +"at #ollo$s is a 'ara'"rase o# t"at intervie$* T"e re'orter said to 6*T*>* t"at "e !ust "ave been elated t"at "e 'ic,ed t"e e@act lo$ day to buy T(bonds be#ore t"ey e@'loded to t"e u'side8 7r* >ones re'lied t"at t"e state!ent $as only 'artially correct* -e said a !ore accurate state!ent $ould be5 K6aul Tudor >ones correctly #orecast t"e recent lo$ in Treasury ;onds ? a#ter #ailing to #orecast t"e lo$ on "is last #ive atte!'ts8a You can rest assured t"at 6*T*>* "ad a #ir! gri' on t"e ris, assess!ent on all o# t"ose trades* -is a''roac" to ris, control is $"at !a,es "i! a great trader AKa !ar,et $i<arda=* % elder#an * * Sun, Oct /9, 959/67 ET /* decide t"at you are in t"e !ar,et #or t"e long "aul(t"at is, you $ant to be a trader even 12 years #ro! no$* 1* learn as !uc" as you can* read and listen to e@'erts, but ,ee' a degree o# "ealt" s,e'ticis! about everyt"ing* as, )uestions and do not acce't e@'erts at t"eir $ord* 9* do not get greedy and rus" to trade( ta,e your ti!e to learn* t"e !ar,ets $ill be t"ere $it" !ore good o''ortunities in t"e !ont"s and years

a"ead A$e "o'e=* 4* develo' a !et"od #or analy<ing t"e !ar,et elder#an * * Sun, Oct /9, 959467 ET use several analytical !et"ods to con#ir! trades* C* develo' a !oney !anage!ent 'lan* your #irst goal !ust be long ter! survivalV your second goal steady gro$t" o# ca'italV your t"ird goal !a,eing "ig" 'ro#itsV F* be a$are t"at a trader is t"e $ea,est lin, in any trading syste!* :* $inners t"in,, #eel, and act di##erntly t"an losers* you !ust loo, $it"in yoursel#, stri' a$ay your illusions, and c"ange your old $ays o# being, t"in,ing, and acting* c"ange is "ard, but if you want to be a professional trader# you have to wor) on

changing your personality


n t"e latest issue o# t"e !ont"ly co!!uni)ue t"at t"e O@#ord Blub sends to its !e!bers, Steve S.uggerud says, %At a ti!e $"en stoc,s a''ear bot" boring and e@'ensive, co!!odities are "ot and don&t loo, li,e t"ey&re going to cool o## anyti!e soon*% According to Steve, $ays to 'ro#it #ro! co!!odities* /* You can invest in a broad(based, no(#ee !utual #und t"at "olds co!!odity(ty'e co!'anies* Steve&s to' c"oice is t"e T* Ro$e 6rice Ne$ Era Dund A6RNEW=, $"ic" rates C stars $it" 7orningstar* 1* You can get !ore s'eci#ic and o$n a narro$ly based #und, suc" as a gold #und* Steve&s reco!!endation "ere is Dran, -ol!es& U*S* Global Gold s"ares AUSERW=, $"ic" "as been around #or 92 years* 9* You can get broader and li!it your #ees t"roug" (s"ares A$$$*is"ares*co!=, $"ic" act li,e inde@ #unds* T"ere are t"ree di##erent natural(resource/energy(based (s"ares, Steve 'oints out, all o# $"ic" could bene#it #ro! an increase in co!!odity 'rices*

uptown6 . . -ed, 2ul $#, 3%D6BM (T I elie!e Titan and 'elocity are 455/ ull funds and Tempest and 'enture 455/ ear funds. *o!a is $.5 sp0 )yde0 ;rsaM earO madrone$Zsw ell.net

t$ocents * * Tue, Se' /:, /5/467 ET GOLD STOBES !iners* bro,en "ill/billiton, angloa!erican, rio tinto, #ree'ort golod P co''er* good long ter! & >OE ROSS TRADERS TR BE ENTRY P /(1(9 SL DE 6RESENTAT ON T"oug"ts on Trading Did you ,no$ t"at 'ro#essional day traders reverse t"eir 'ositions about F20 o# t"e ti!e $"en t"ey ta,e lossesX +"y do t"ey do t"isXX T"e !ar,et s"ould not "ave tec"nically reac"ed t"e e@it 'rice, $"ic" is 'laced $"ere t"e intraday !ar,et trend !ay "ave reversed t"e s"ort ter! trend* Bonsider a !ar,et t"at !oves a t"ree(day average range above t"e o'ening 'rice, t"en brea,s s"ar'ly to t"e do$nside and 'osts ne$ intraday lo$s $it"in t"e last "our o# trading as a trend reversal condition* SP6 locals $ill usually cover and !ay reverse a /22('oint or greater s"ar' brea, on t"e #irst eig"t "ig"er u' tic,s #ro! an intraday botto!* +"ile you !ay not be $illing or able to trade li,e an SP6 local, you !ust still learn to reverse $"en it is o''ortunistic to do so* Dor instance, letQs say you decide to go s"ort on a TTE ATraders Tric, Entry= a"ead o# t"e brea,out o# a /(1(9 "ig"* +"at i# you do get s"ort and 'rices begin to "ead "ig"erX S"ould you reverseX T"e ans$er is yes you s"ould* +"at you are loo,ing at is a TTE to go long a"ead o# t"e brea,out o# a R"* Let !e s"o$ you $"at !ean5

_242421b Dor #urt"er understanding o# t"ese tec"ni)ues, study t"e La$ o# B"arts on our $ebsite, "tt'5//$$$*tradingeducators*co!/de#ault*as'X DG3*

Eno$ T"ysel# +e&ve been trading #or a long ti!e no$, and $e&ve #igured out t"at t"e ,ey to success#ul investing is not great syste!s, or brilliant analysis, but 'syc"ology* # you t"in, about it, t"ere&s got to be a reason $"y a $"ole bunc" o# s!art guys and gals are buying stoc,s rig"t at t"e !ar,et&s to', and $"y t"ere&s a $"ole bunc" o# s!art guys and gals selling rig"t at t"e botto!* T"at reason, !ost li,ely, "as to do $it" t"e !ere #act t"at t"ey "ave a #eeling o# security going along $it" ot"ers $"o also "ave good reasons #or buying or selling at t"e absolute $orst ti!e* # $e are to be success#ul investors, and i# $e "o'e to serve our clients $ell, $e "ave to #ind $ays to !a,e sure $e aren&t being lulled into doing t"e $rong t"ing at t"e $rong ti!e #or 'syc"ological reasons* T"e best $ay to do t"at is to #ind our o$n $ea,ness and to structure our business or our trading disci'line to avoid t"at one $ea,ness* Since $e&ve li,ely ta,en great 'ains to co!'ensate #or t"at $ea,ness, i# $e can avoid t"e da!age t"at t"at $ea,ness causes, our 'er#or!ance can be stellar* t be"ooves all o# us to e@a!ine our #ailures closely* Let&s loo, at our bad trades and see i# $e can deter!ine a 'attern* Do $e #ail to 'ull t"e trigger, 'assing on great trade ideasX Do $e "ang on to losses too longX Do $e !arry an idea, and "ang onto it long 'ast its use#ul li#eX Once $e deter!ine our $ea,ness, t"en $e can na!e it* # $e can na!e it, $e can ta,e ste's to avoid it* 7 NE S TAE NG 6ER OD B 7ASS OE LOSSES +- B- + 6E OUT ALL 6REO OUS GA NS888 GET ANGRY AND BANQT TAEE STR NG OD S7ALL LOSSES S USUAL SETU6 TO D SASTER** R B-ARD RUSSELL`OBTO;ER 1221

0hen dealing with the mar)et# it's no shame to be wrong. The real sin is to (T7O wrong (which is always an ego problem). . .
Russell began 'ublis"ing Do$ T"eory Letters in /3CI, and "e "as been $riting t"e Letters ever since Anever once "aving s,i''ed a Letter=* Do$ T"eory Letters is t"e oldest service continuously $ritten by one 'erson in t"e business*

a few words of wisdom from $esse

+ivermore%

!A loss never bothers me after I take it I forget it overnight &ut being wrong ' not taking the loss ' that is what does damage to the pocketbook and to the soul !
one o# 6esavento&s little stories really li,e**** % n t"e 'ast t$o decades #e$ traders "ave e@'erienced
t"e success o# 6aul Tudor >ones8 7r* >ones e@'loits in t"e !ar,ets "ave reac"ed t"e legendary status t"ey deserve* 7y #avorite tidbit is #ro! an article in t"e +all Street >ournal $"en "e $as intervie$ed on "is trading* T"e re'orter $as very e@cited by 6*T*>*Qs recent success in t"e Treasury bond !ar,et* +"at #ollo$s is a 'ara'"rase o# t"at intervie$* T"e re'orter said to 6*T*>* t"at "e !ust "ave been elated t"at "e 'ic,ed t"e e@act lo$ day to buy T(bonds be#ore t"ey e@'loded to t"e u'side8 7r* >ones re'lied t"at t"e state!ent $as only 'artially correct* -e said a !ore accurate state!ent $ould be5 K6aul Tudor >ones correctly #orecast t"e recent lo$ in Treasury ;onds ? a#ter #ailing to #orecast t"e lo$ on "is last #ive atte!'ts8a You can rest assured t"at 6*T*>* "ad a #ir! gri' on t"e ris, assess!ent on all o# t"ose trades* -is a''roac" to ris, control is $"at !a,es "i! a great trader AKa !ar,et $i<arda=* %