(From The Preface – by Henry Clasing) – The book will begin with psychology, our own and that of the marketplace. Winners tend to behave a certain way and so do losers. I will cover these special traits. You will then see how many human traits, impatience, boredom, panic, greed and others all manifest in price behavior.
Price behavior is our next area to investigate. I will introduce many new methods of price analysis. Winning in any game requires having an edge over the competition. I will show you the importance of the central tendency in price trends; how to construct a new type of trend channel, including buy areas and sell areas; how to track trendlines that are curved; how to recognize blowoffs and shakeouts; how to monitor, rather than forecast, price cycles; how to recognize overbought and oversold levels on a daily basis; and more. These are the tools to help you be successful.
Next I will present a general fundamental model which can be applied to any market and which shows how to tie together the major fundamental forces, the psychology of the marketplace, and the price measurements of what is taking place.
Since we are all individuals with varying sensitivity to losing money, a variety of programs will be presented to help you manage your money. You will begin with a long-term program which will help you work with trends lasting 2 to 9 months. Included will be how to gradually add money to your position and how to take profits. Most importantly will be how to keep your losses to a minimum.
The next time frame covered will be from 1 to 10 weeks. Here I introduce several cycle tracking techniques, plus several moving averages which are sensitive enough to recognize new trends early, but not so sensitive that you are stopped out of a position too soon.
Finally, you’ll learn several short-term models, some of which are excellent for day trading. These methods will be good for both trending and cyclical markets. You will have stop points to give your broker at the beginning of each day.