Long–Term Secrets to Short–Term Trading 2e

Acknowledgments xi
<p>INTRODUCTION You Are Already a Commodity Trader 1</p>
<p>My Most Important Market Belief 4</p>
<p>The Beginning of My Career as a Speculator 5</p>
<p>The Ride of a Lifetime 8</p>
<p>CHAPTER 1 Making Order Out of Short–Term Chaos 9</p>
<p>How I Learned about the Market 9</p>
<p>Charting the Market 11</p>
<p>The Nonrandom Market 13</p>
<p>Understanding Market Structure 15</p>
<p>Market Structure Will Never Change 21</p>
<p>Short–Sell Pattern 27</p>
<p>Target Time and Trailing Stops 28</p>
<p>Recap 32</p>
<p>CHAPTER 2 It s a Question of Price and Time 33</p>
<p>All You Will Ever Need to Know about Cycles 33</p>
<p>The Natural Cycle of Range Change 39</p>
<p>Where the Trend Is with You The Second Power–Play Price Pattern 50</p>
<p>Recap 54</p>
<p>CHAPTER 3 The Real Secret to Short–Term Trading 59</p>
<p>It s All about Time 61</p>
<p>Bankrolling Hotshot Traders 62</p>
<p>Proving the Point 65</p>
<p>How to Make the Most Money 68</p>
<p>Recap 70</p>
<p>CHAPTER 4 Volatility Breakouts The Momentum Breakthrough 71</p>
<p>Simple Daily Range Breakouts 76</p>
<p>A Look at Volatility in the S&amp;P 500 80</p>
<p>Separating Buyers from Sellers to Find Volatility Using Market Swings 95</p>
<p>Results 96</p>
<p>One Step Further 97</p>
<p>Recap 98</p>
<p>CHAPTER 5 The Theory of Short–Term Trading 99</p>
<p>What Is Wrong about the Information Age 103</p>
<p>E. H. Harriman s Rule of Making Millions 104</p>
<p>Recap 105</p>
<p>CHAPTER 6 Getting Closer to the Truth 107</p>
<p>The Market Is Not a Coin Flip: Random Walk or Cootner versus Cohen (Cohen Wins) 108</p>
<p>Gold TDOM Study 117</p>
<p>Bond TDOM Study 118</p>
<p>Monthly Road Maps 120</p>
<p>Recap 123</p>
<p>CHAPTER 7 Patterns to Profit 125</p>
<p>The Common Element 126</p>
<p>The Questions to Ask 131</p>
<p>My Smash Day Patterns 132</p>
<p>How to Use Smash Day Patterns 136</p>
<p>Specialists Trap 137</p>
<p>A Vital Note This Works on Shorter Time Frames as Well 141</p>
<p>Oops! This Is Not a Mistake 145</p>
<p>S&amp;P Oops! Trading 151</p>
<p>Recap 152</p>
<p>CHAPTER 8 Separating the Buyers from the Sellers 153</p>
<p>Greatest Swing Value 155</p>
<p>Stock Index Trading with Greatest Swing Value 156</p>
<p>Some Pointers 160</p>
<p>Recap 161</p>
<p>CHAPTER 9 Short–Term Trading from a Quote Screen 163</p>
<p>How a Quote–Screen Trader Makes Money 165</p>
<p>Swing Points as Trend Change Indication 166</p>
<p>The Three–Bar High/Low System 167</p>
<p>A New Indicator for Short–Term Traders: Willspread 170</p>
<p>Willspread and the S&amp;P 500 Stock Index 174</p>
<p>Recap 180</p>
<p>CHAPTER 10 Special Short–Term Situations 181</p>
<p>Month–End Trading in Stock Indexes 181</p>
<p>Target Months 184</p>
<p>Making It Better 184</p>
<p>Month–End Trading in the Bond Market 186</p>
<p>Getting Specific 187</p>
<p>Better and Better 188</p>
<p>A Time to Sell 191</p>
<p>Recap 193</p>
<p>CHAPTER 11 When to Get Out of Your Trades 195</p>
<p>CHAPTER 12 Thoughts on the Business of Speculation 197</p>
<p>Exits before Entries 197</p>
<p>What Speculation Is All About 200</p>
<p>It s about Time 201</p>
<p>Essential Points about Speculation 202</p>
<p>Recap 215</p>
<p>CHAPTER 13 Money Management The Keys to the Kingdom 217</p>
<p>Most Traders Use a Hit–and–Miss Approach 218</p>
<p>Approaches to Money Management One Is Right for You 218</p>
<p>The Good, the Bad, and the Ugly of Money Management 219</p>
<p>Looking in New Directions, Drawdown as an Asset 222</p>
<p>Back to Ralph: 2011 Money Management Breakthrough 228</p>
<p>The Kelly Ratio Mirage 229</p>
<p>Recap 233</p>
<p>CHAPTER 14 From Kennedy to Obama, Thoughts from 50 Years of Trading 235</p>
<p>Trading and Collecting Honey 236</p>
<p>Low–Hanging Fruit 237</p>
<p>Look before You Leap 238</p>
<p>Remember the Game Called Pick Up Sticks 238</p>
<p>And It Can Get Worse by Far. . . 239</p>
<p>Lock–Up Time 240</p>
<p>Enough on Greed . . .Now Let s Deal with Fear 241</p>
<p>Running, Trading, and Losing 242</p>
<p>Doing the Wrong Thing . . . It s So Easy, Isn t It? 242</p>
<p>It s Not the Trade, It s the Battle 243</p>
<p>The Art of Fly–Fishing Revisited 244</p>
<p>Fear and Greed, Looking Them in the Face Again 245</p>
<p>Why Most Traders Lose Most of the Time 246</p>
<p>A Review of Losing Trades Showed That 247</p>
<p>The Number One Reason We Lose Money Trading 247</p>
<p>The Most Important Trading Belief You Have 248</p>
<p>The Worst Dog I Ever Had Cost Me the Most 249</p>
<p>Athletics Are Such a Parallel to Trading 251</p>
<p>What Causes Stock and Commodity Market Trends 251</p>
<p>How to Measure the Public versus the Pros 253</p>
<p>Folks, It Just Can t Be Done 254</p>
<p>The Rush of Trading 255</p>
<p>Beating Them to the Punch 257</p>
<p>It s Just Over My Head 259</p>
<p>I Looked Fear and Greed in the Face 259</p>
<p>The ShowMust Go On 260</p>
<p>Broken Noses, Cauliflower Ears, and Bad Trades 261</p>
<p>Learning How to Lose Money 262</p>
<p>Hillary, High Hopes, and Heartaches 263</p>
<p>Nervous Nellies Heaven Bound 264</p>
<p>Secrets of System Developing and Trading 265</p>
<p>The Difference between Winners and Losers 266</p>
<p>Recap 268</p>
<p>CHAPTER 15 Just What Does Make the Stock Market Rally? 269</p>
<p>Logic 101 270</p>
<p>These Words Are My Bond 270</p>
<p>A Look at Data A and Data B 270</p>
<p>Let s Break Some Bad Habits 273</p>
<p>How to Break Bad Habits 273</p>
<p>Comments on Setting Stops Dollar Loss and Unpredictability 275</p>
<p>An Overview of How I Trade 278</p>
<p>My Trading Strategy . . .How It Works 282</p>
<p>Recap 285</p>
<p>CHAPTER 16 Hard Facts about a Very Hard Game to Win 287</p>
<p>It Is Just Like Life 289</p>
<p>Maybe You Are Not Cut Out for This . . . 292</p>
<p>You Are in a Tough Spot . . . 293</p>
<p>But There s a Little Bit More. . . 294</p>
<p>In Closing 295</p>
<p>Index 297</p>