"Technical Analysis: The Complete Course" by Jack Schwager. Jack D
Translation from English A. Kunitsyn - Ch. 1–12, 14; B. Zuev - ch. 13, 15–24
Editor A. Dzyura
Technical editor N. Lisitsyna
Corrector E. Chudinova
Layout designers A. Fominov, K. Lun
© Jack D. Schwager, 1996
© John Wiley & Sons, Inc., 1996
© Publication in Russian, translation, design. Alpina Publisher LLC, 2017
All rights reserved. The work is intended exclusively for private use. No part of the electronic copy of this book may be reproduced in any form or by any means, including posting on the Internet or corporate networks, for public or collective use without the written permission of the copyright owner. For violation of copyright, the law provides for payment of compensation to the copyright holder in the amount of up to 5 million rubles (Article 49 of the Code of Administrative Offenses), as well as criminal liability in the form of imprisonment for up to 6 years (Article 146 of the Criminal Code of the Russian Federation).
With love - to my son Zakhar, whose affection touches me, his creative abilities impress me, and his sense of humor delights me
Problems arise to make us grow.
If there were no problems in life, we would all become mediocre.
Wally ("Famous") Amos
Preface
Despite the claims of countless books, advertisements and brochures, stock trading success cannot be contained in any indicator, formula or system. This book is written by a trader, from a trader's point of view, and is not a collection of analytical techniques, indicators or systems using idealized illustrations, but a manual based on real practice.
In explaining a variety of analytical techniques and methods, I have tried to keep at the forefront key issues that are often ignored by authors of books on technical analysis. How to apply the described methods in real trading? What is suitable and what is not suitable for working in the market? What signs indicate the unsuitability of the method? How to Design and Test a Trading System to Maximize It future, but not retrospective effectiveness?
Jack D. Schwager
New York, October 1995
Words of gratitude
In my early years in the futures markets, I was a pure "fundamentalist" and had complete disdain for technical analysis - an opinion, I must say, based more on prejudice than on knowledge or experience. At the time, I was the director of research at a large brokerage firm. There was a technical analyst in my department, and I began to notice something strange: he was often correct in his judgments about market behavior. We became good friends and he taught me the basics of graphical analysis. As I gained experience in using technical analysis, my attitude towards it changed to the diametrically opposite. The technical analyst who first introduced me to the methodology and had such a big impact on my career is Steve Kronowitz. Without Steve, this book would probably never have happened.
Over the past seven years I have worked very closely with Louis Lucac, my partner in a futures trading advisory firm. Louis is not only an excellent programmer, he also has outstanding knowledge of building and testing systems. Louis wrote programs for many of the systems I had developed over the years and worked with me to combine these systems into a highly sophisticated computerized trading methodology. If it weren't for Louis, I would never have been able to see my ideas work (and make money) in the real world.
There were several subject areas that I wanted to include in this book, but in which I felt I lacked experience. Therefore, I selected and invited several co-authors to write these chapters. Here are my co-authors and the topics they devoted their work to: Thomas Birowitz wrote about oscillators, Richard Mogi wrote about cyclical analysis, and Steve Nison wrote about Japanese candlestick charts. Everything that came before was important, but most of all I am grateful to my wife, Jo Ann. Jo Ann understood my desire, perhaps even my inner necessity, to write the series of books of which this volume is a part—to commit to paper what was inside me. I thank her for supporting me in working on this project, despite her full awareness that this effort significantly impinges on our time together and on our family structure. And following this, I thank my children Daniel, Zakhar and Samantha for the way they reacted to the reduction of my presence in their lives.
Unless otherwise noted, charts in this book are reproduced with the kind permission of Prudential Securities Inc.
Jack D. Schwager
Graph Analysis
1. Graphs: forecasting tool or folk art?
Common sense is not inherent to everyone.
There is a parable about a stock exchange gambler whose passionate desire to win was only spurred on by another loss. In the beginning, he tried to base his trading decisions on fundamental analysis. He built complex models that predicted stock prices based on detailed supply and demand statistics. However, these forecasts were invariably overturned by some unforeseen event, be it a drought or an unexpected export deal.
Finally, infuriated, he abandoned the fundamental approach and turned to graphical analysis. He carefully monitored price charts, looking for repeating patterns that would reveal the secrets to successful stock trading. He was the first to discover such unusual formations as “shark’s teeth” daytime lows and “Himalayan peak” highs. But alas, the models always seemed reliable only until the moment he began to base his transactions on them. When he went short, the highs turned out to be just pauses in the growing bull market. In an equally ruinous way, after each of his purchases, the steady trend of rising prices suddenly reversed.
“The problem,” he mused, “is that graphical analysis is too crude. I need a computerized trading system." So he started testing different schemes to see if any of them would have been profitable as a trading system in the past. After exhaustive research, he discovered that buying soybeans, cocoa, and Eurodollars on the first Tuesday of odd-numbered months and then closing those positions on the third Thursday of that month produced significant profits over the past five years. Incredibly, this extensively studied pattern stopped working after he started trading. Another bad luck.
Jack Schwager is managing director and head of Fortune Group, an alternative asset manager regulated in the UK and the United States. Schwager is a senior portfolio manager for Fortune's Market Wizards Funds of Funds, a series of broadly diversified institutional hedge funds. He also serves on the board of directors of Fortune Global Fund Analysis, an independent hedge fund research center.
His experience includes 22 years as director of the futures research group for leading Wall Street firms and 10 years leading commodity futures trading. Mr. Schwager is perhaps best known as the author of the acclaimed book Market Wizards (1989) and the equally popular book The New Market Wizards (1992). The third volume in the series, The Stock Market Wizards, was published in early 2001. Mr. Schwager's first book, The Complete Guide to the Futures Markets, which was published in 1984, is considered one of the classics on the subject of futures trading. More than ten years later, he revised and expanded this original work in three volumes in the Schwager and Futures series, including Fundamental Analysis (1995), Technical Analysis (1996), and Trading Management: Myths and Truths (1996). He is also the author of Introduction to Technical Analysis (1999), part of John Wiley's popular Introduction series.
Mr. Schwager is the author of many seminars. In his lectures, he focuses on the experience of the world's leading leaders in trading and investing, the largest hedge funds, technical analysis and the application of trading systems. He holds a bachelor's degree in economics from Brooklyn College and a master's degree in economics from Brown University.
Books (5)
Stock magicians
Stock Magicians allow the reader to enter the world of their thoughts, to understand the fundamental principles of their success - that is, a different approach to different markets, the rules of trading followed, personal advice from these professionals to other traders.
What it costs to become a successful trader, you will understand and hear from the mouths of the stock exchange magicians themselves.
Stock Market Wizards
Stock Market Wizards is the latest book in the acclaimed Market Wizards series, in which the author interviews America's most successful traders and portfolio managers. Each of Schwager's interlocutors achieved amazing results in trading the stock market, thereby refuting the common assertion that price movements are random and unpredictable.
The variety of trading styles of market wizards is amazing, and one of the common features of the most successful market players is the use of their own, individual approach to the market. Reading this wonderful book will help both novice investors and professionals take a fresh look at the market and discover new methods for making profits.
New market magicians
The book allows you to gain first-hand investment ideas and trading techniques from leading professionals - “market wizards”. The variety of trading methods used by these “market wizards” is amazing.
Some of them trade only on the basis of fundamental analysis without ever looking at stock price charts, others use only technical trading systems, others focus on options pricing problems, and others try to find opportunities for arbitrage profits in today's hyper-efficient market.
Technical analysis. Complete Guide
In his book `Technical Analysis. The Complete Course Legendary financial analyst Jack D. Schwager explores technical analysis in depth, focusing on what works and what doesn't work in trading real markets. In this book's study guide, Thomas Birowitz, Jack Schwager, and Stephen Turner provide a set of tests and problems to help you master the material presented in this book. The organization of the material in the manual is simple and fully consistent with the structure of the book `Technical Analysis. Full course.
However, he is known primarily as the author of the famous book series “Stock Wizards” and the course “Technical Analysis”. A wonderful read. However, the question is - is the author really worthy of attention? So that it doesn’t work out like with some people who live from selling books and teaching life (hee).
I want the organism, whose books I will devote several priceless, precious hours of my life to reading, to be worth it. And he didn’t just write books, being a naked theorist.
Schwager's professional life
In the case of Schwager, you can rest assured. This charming and not yet quite ancient guy (he was born in 1948) has an excellent reputation as a futures professional.
In particular, right now, while you are scratching (insert your favorite place), Jack is working at the ADM Investor Services investment fund, with a portfolio of futures and FX accounts. He is also an advisor to the Singapore-based fund management company Catalytic Investment Group, specializing in various investment strategies.
He worked for almost 9 years at the London company Fortune Group, which provided consulting services to numerous hedge funds there. Finally, he worked on Wall Street for almost 22 years in companies that specialized in futures trading, in particular, Prudential Securities. In other words, Jack is a trader and investment manager first and an author second.
Schwager's latest project is the FundSeeder platform, which specializes in finding promising traders, for whom they then find suitable wealthy investors.
Schwager constantly conducts seminars and lectures where he talks about famous traders (who often become the heroes of his books), investment mistakes, hedge fund portfolios and managed accounts. And of course, about technical analysis and methods for evaluating various trading systems.
As for education, these are Brooklyn College and Brown University with a degree in Economics.
Indicators
Few people know that Schwager is the developer of several technical indicators. In particular:
- Trend Weight (TW);
- Overbought/Oversold Weight (OOW);
- Directional Weight (DW).
Trend Weight (TW) combines short-term, medium- and long-term trend signals into a special composite number. The OOW indicator indicates the point of a possible trend reversal, increasing with the growth of the trend and balancing TW.
Finally, the DW indicator increases with the trend and falls when the increase in OOW exceeds the increase in the TW indicator.
In general, these are purely trend indicators. Don't look for them on your charts - indicators are available exclusively on the professional trading platform TradeShark, starting in 2013.
Very, very busy dude. And despite this, he still has time to write world-famous books.
Schwager's books
All his books can be divided into 2 series.
- Market magicians.
- Technical analysis.
In "Magicians" you will not find descriptions of specific strategies or trading systems. They are, first of all, about psychology. Who do you need to be and what do you need to do to become a millionaire or billionaire?
When Schwager wrote his first book about magicians in 1989, some of the characters he interviewed were millionaires. These days, some of them are already billionaires and are included in the Forbes list as the richest people on the planet.
It is interesting to know what these citizens did to rake in so much money? Still would. This is why books are relevant. In real life, you have zero (0) chance of talking to a future billionaire. And Jack did the job for us.
Market magicians
One of the most famous book series in the world, which shows the psychological underside of trading. Interviews with famous wealthy traders reveal what it's like to make and lose millions in an instant.
- Market Wizards (1989, last reprint 2012). In Russian it came out as “ ”.
- The New Market Wizards (1991). In Russian " ”.
- Stock Market Wizards (2001). In Russian " ”.
- Hedge Fund Market Wizards (2012). Not translated into Russian.
- The Little Book of Market Wizards (2014). Schwager's new book. Not translated.
Technical analysis
Schwager's main series related to technical analysis is the three-volume Schwager on Futures. It includes three books:
- Fundamental Analysis (1995). Not translated.
- Technical Analysis (1996). In Russian " Technical analysis. Full course”.
- Managed Trading (1996). Not translated.
- Getting Started in Technical Analysis (1999). In Russian " ”.
- Market Sense and Nonsense (2012). Not translated.
Of particular note is the short (170 pp.) manual from Schwager, Birowitz and Turner for those who want to master the book “The Complete Course”.
- Study Guide to Accompany Technical Analysis. In Russian " Guide to studying the book Technical Analysis. Full course".
Schwager's books in Russian
Stock magicians. Interviews with top traders
Schwager's most famous book, which has been reprinted many times. The book consists of 5 parts and includes interviews with famous traders (some of them are now billionaires) working in various markets.
From it you will learn the most important thing - about the psychology of successful dudes. How they trade, how exactly they make decisions. The book also contains a lot of trading anecdotes. After each interview, Schwager sums up the results and describes what conclusions can be drawn after meeting a particular trader.
Part 5 of the book covers the psychology of trading, and the appendices include basic options theory and other nonsense for those who want to trade the CBOE.
Traders described in the book:
- Ed Seykota was one of the original creators of a computerized trading system in the 1970s.
- Bruce Kovner is a billionaire currency and futures trader. 106th place in the Forbes list.
- Paul Tudor Jones is a billionaire, one of the most famous traders in the world; 108th place in the Forbes list, owner of Tudor Investment.
- Michael Steinhardt is a hedge fund legend who manages companies worth more than $20 billion.
- Van K. Tharp is one of the most famous trading teachers and the author of many books.
- Jim Rogers is a billionaire investor, Wall Street legend, and author of several books.
New market magicians. Conversations with America's Best Traders
Continuation of the first book. Seen the light in 1992. The format is the same - interviews with famous traders and comments from Schwager. At the end of the book there are 42 “golden” trading rules.
Traders:
- Bill Lipschutz is a forex trader and head of Hathersage Capital Management.
- Randy McKay is a famous futures trader.
- William Eckhardt is a stock and futures trader.
- Monroe Trout is a financial speculator, hedge fund manager, and quantitative analyst.
- Al Weiss is a trader at AZF Commodity Management, which has been operating since 1982.
- Stanley Druckenmiller was a leading manager at George Soros' Quantum Fund for 12 years. In 2008 alone he earned more than $260 million.
- Richard Driehaus is a fund manager and founder of Driehaus Capital Management. His donations alone amounted to more than $100 million.
- Gil Blake is an investor and fund manager, winner of trading championships from 1988 to 1993, author of a market fixation strategy for investment funds.
- Victor Sperandeo – trader, president of Alpha Financial Technologies; index developer, author of several books; 45 years on Wall Street, working with George Soros and Leon Cooperman.
- Tom Basso is a stock and futures trader, author, and investment advisor since 1980.
- Linda Bradford Raschke – futures and exchange trader, president of LBR Asset Management; her hedge fund consistently ranks top in the Barclayhedge database.
- Mark Ritchie is a futures and options trader on the CBOT and CME, author of two books, and founder of the Chicago Research and Trading Group.
- Joe Ritchie – Mark’s brother, a famous options and stock market trader; By the way, he has been working with Russia since 1987, creating the second American-Russian joint venture in the country, JV Dialoge.
- Blair Hull – included in the list of “40 Greatest Traders in the World” according to Trader Monthly; sold his Hull Trading Company to Goldman Sachs in 1999 for $531 million.
- Jeff Yass is an options trader and founder of Susquehanna International Group.
- Charles Faulkner is an NLP trainer, coach, and futures trader who uses NLP and methods for developing trader intuition.
- Robert Krausz is a futures and exchange trader and the author of a book on Gann trading methods.
Stock market magicians. Interviews with leading stock market traders
A continuation of the “Magicians” series, the book contains interviews with 15 outstanding traders of the 21st century. They trade stocks, options and work in other market niches.
Some of them:
- Michael Lauer is a renowned stock trader and hedge fund owner; in 2011, he faced 25 years in prison and a $500,000 fine, but the charges were dropped.
- Dana Galante is a prime example that a woman can be a super successful trader; specialist in selling falling company shares.
One of the most popular books in the world. You are very lucky that it was translated into Russian. It has everything - basic terminology, oscillators, Japanese candlesticks, a lot of excellent theory.
The book is intended primarily for futures traders. However, as you will see for yourself, technical analysis is absolutely universal and is suitable for everything, including binary options and forex.
Despite the fact that the book was published in 1995, it continues to remain one of the world's key publications on technical analysis. The course is large - 800 pages and is designed for several months of reading and practice.
Do not read such books as fiction. Without consolidation in practice, you will forget its content the very next day.
Guide to studying the book Technical Analysis. Full course
This is a short version of the previous book “Technical Analysis”. It is, as I said, 800 pages – and it’s a long read. In the short version, you will get all the basic concepts of technical analysis in just 176 pages.
That is, in fact, all that is available in Russian. The only thing I couldn't find in the pdf is “ Exchange secrets. Technical analysis" Maybe he'll come across it later. In any case, the main thing is a complete guide to technical analysis and, of course, the “Magicians” series.
Love Schwager or GTFO
The “Market Wizards” series is great. Precisely as a look at the inner world of a person who, through his labor, through stock trading, became a millionaire. How special do you need to be? Do you need to caress supermodels, sniff and drink for this, or can you get by with a sad wife and evening tea?
The books are written in a very easy and accessible language; reading is a pleasure. They can easily replace similar seminars where some bespectacled guy will rumble on about oscillators.
As for the complete course on technical analysis, this is one of the best books on our entire planet on this subject. Of course, in some places it’s complicated, and even very complicated, futures are not like two buttons for a monkey in BO.
But everything has its price. And if someone wants to become a serious trader, he will read this, and not as a school curriculum - but as a guide for practical action.
Read Schwager, be inspired by stock magicians, practice technical analysis - and big fat money will come your way. Don't forget to buy a bigger wallet.
Technical analysis today is a way of predicting price behavior by studying this behavior in past periods.
This theory is based on the fact that studying market behavior in the past will make it possible to predict its behavior in the future. Technical analysis got its name due to the fact that it studies only charts of volumes and prices from past periods to the present, without taking into account other factors.
The need for technical analysis in modern trading
Technical analysis, thanks to its convenient graphical display of information, is widely popular today in creating profitable trading systems. Price charts can be perfectly perceived and evaluated, and time-tested graphic figures and patterns are always stable. What explains this stability?
It's simple. This fact is explained by the psychology of market participants. When certain recurring market conditions occur, most traders act and react in approximately the same way.
In other words, there are a number of patterns of human behavior when similar situations arise that help predict with a high percentage of probability where prices will move in the future.
It should be understood that it is not the companies participating in the market that are responsible for price changes, but investors. For example, you can often hear in the news that a company has announced huge profits. Then we see an increase in its shares. But it was not the company that raised the prices for its shares, but investors, because they wanted to purchase them, thereby increasing the demand for them. This is precisely the principle.
By and large, technical analysis is carried out with the aim of determining the prevailing investor sentiment in the market, with a view to further following them. This is where one of the basic rules of trading emerges - always trade only with the trend, at least while it exists, and never against it.
A book by expert analyst Jack Schwager. Video review: Technical analysis. Full course
As a professional said, technical analysis studies the movements of mass psychology of people in financial markets. Moreover, each of the trades is a battle between the “bulls” who receive profit from rising prices and the “bears” who extract it from a decrease in prices. Therefore, the purpose of technical analysis is to identify which of them is stronger in order to bet on the winner.
But how to identify this winner, how to use all these oscillators, indicators, chart patterns and other market movements? Of course, by completing a full course of training, attending webinars, courses and reading books, one of which we will talk about in this material. This is the book “Technical Analysis. The Complete Course" originally written by Jack Schwager. You can download this work in PDF format below.
Jack Schwager - technical analyst book review
Before we talk directly about the book, let’s focus on the author. So, Jack Schwager today is the head and managing director of the Fortune Group, an asset management company regulated in the US and UK. Jack Schwager also serves on the board of directors of one of the affiliates of a research center that studies hedge funds and is the chief portfolio manager of several institutional, widely diversified hedge funds.
Jack Schwager has many years of experience as director of a futures market research group covering most of the leading and well-known Wall Street firms, as well as 10 years of experience trading commodity futures. In addition, D. Schwager has a master's degree in economics from Brown University and a bachelor's degree from Brooklyn College.
Jack Schwager is also known as the author of the book “Market Wizards” that made a huge splash in his time (1989) and the equally popular work “New Market Wizards”, which was published in 1992. At the beginning of 2001, the third volume of this series of works by the author, “Magicians of the Stock Market,” was published.
Jack Schwager is the author of many other books relating to both technical and trading management, futures and so on. It should also be said that Jack Schwager conducts a large number of proprietary seminars, which focus on the experience of leaders in the world of investing and trading, as well as the largest hedge funds that use technical analysis in their trading systems.
Book Technical Analysis. Complete course, review of Jack Schwager's manual
The book “Technical Analysis” written by J. Schwager. Complete course", an electronic version of which is available in PDF format can be downloaded below, is the most in-depth study on the topic of technical analysis. The book introduces the reader not only to the most detailed information on trading in foreign exchange markets, but also allows you to see the results of some of the author's experiments.
In this publication, theory is tightly intertwined with practical examples. All graphic examples are real market situations. Schwager's book “Technical Analysis. The Complete Course" reveals the basic concepts of analysis, trading techniques, systems, indicators and trading methods.
The main focus of the book is on the practical application of analytical methodology used when trading in financial markets. Let us immediately note that the book contains a huge amount of graphic materials, from a wide variety of trading platforms, which best illustrate the methods and methods of using technical analysis.
What do the three parts of the book consist of, a complete course of technical analysis from D. Schwager
The first book manual describes the classical basics of graphical analysis (all possible), their logical explanation and internal essence, as well as the necessary actions of traders when such patterns appear.
In this part, the author pays great attention to the possibilities of using various tools, as well as a non-standard approach to their use. In other words, the book is not a boring academic description of candles and their combinations, but is a living guide from a famous expert and practitioner.
Let us immediately note that the book contains chapters that describe in detail oscillators and various indicators used in recognizing graphic patterns. These chapters were co-authored with renowned experts such as Thomas Borowitz and Steve Nisson.
The second part of the book “Technical Analysis. The Complete Course” serves as a practical guide for using the manual discussed in the first part.
More than 100 specific trading situations are discussed here, which are studied in detail through technical analysis. The author, as if in real time, explores together with the reader all possible options for market entry, thereby involving him in the process of making the right decision.
In the third and fourth parts of the book, Jack Schwager describes the use of some trading systems, oscillators and some other technical tools.
In the final part, the book contains the philosophy of trading, as well as useful author's recommendations and advice, without which today it will be quite difficult to do without trading on the market.
Video course. Basis of technical analysis by patterns
Jack Schwager's book on technical analysis may be useful for those interested in automating technical signals when trading in financial markets.
The book outlines the basic concepts, methods, trading techniques, indicators and systems. And this is its usefulness - from certain postulates to practice.
But in my opinion, the book is secondary. I rate Murphy's books more highly in the field of technical analysis.
Schwager
- August 19, 2018, 12:00
- Dmitry Shirokov
- 61 books, No. 3 in the ranking
Despite the fact that some say that technical analysis is not applicable in investments, I still use it in my work. The book had a very interesting topic related to false signals such as: traps for bulls or bears, puddle breakouts of levels or trends, etc. Probably from Of all the books I’ve read on technical analysis, and there are quite a few of them, this one probably deserves a good rating. It’s easy to read, so I recommend it to everyone))
Technical analysis you can eat)
- 13 March 2018, 16:51
- Vladimir Kachanov
- 6 books, No. 64 in the ranking
This book on technical analysis is written in normal language: that is, a person even with a zero basis will understand something, and an experienced trader (who knows technical analysis well) will enjoy reading it. Since by the time I read this book I had taken courses with Viktor Tarasov, I read it in one sitting.
Handbook on technical analysis
- 03 February 2018, 16:59
- Vladimir
- 4 books
super book I recommend it to everyone
- March 28, 2017, 1:48 pm
- Vladimir Takhtarov
- 6 books, No. 56 in the ranking
I liked its practical part, that is, real examples and suggestions of what you would do, precisely because there was nothing to the right of the graph, that is, these were his real mistakes and successes, and of course, an example of different strategies, forced the brain to move and come up with what either my own strategy or trading system before that were just words for me, I started keeping a journal, a trader’s diary after reading this book, I strongly advise everyone to read it as soon as possible
Ambiguous conclusion.
- 14 February 2017, 16:06
- KirillVlad
- 7 books, No. 49 in the ranking
The book is good, there are interesting thoughts. However, after reading, I cannot say that my analytical abilities have grown and moved to a new level. (Maybe it's just me)))
The material is presented clearly, without being too abstruse.
I would consider two disadvantages of the book (IMHO): a large chapter with illegible graphs for practice (just pictures, as for me, you should practice in real time) and the second point is the dedication of a decent number of pages to the topic of automating calculations and creating mechanical systems. (D. Schwager is a supporter of robots)
Overall the book is good. I recommend reading it for beginners; for experienced traders it will be a retelling of already learned truths.
One of the best
- 26 July 2016, 19:52
- Arizona
- 2 books
“Technical Analysis” by Jack Schwager is one of the last books I read. One of the technical ideas that was especially useful to me was internal trend lines. An excellent and detailed guide for beginning traders.
Favorite excerpt about graphical analysis:
“In conclusion, we note that skeptics are probably right when they claim that a thoughtless reaction to graphic signals, similar to the reflexes of animals in the experiments of Academician Pavlov, will not lead to success on the stock exchange. However, this in no way contradicts the fact that the skillful use of charts, as discussed above, can indeed be the core of an effective trading plan. Anyway
graphical analysis remains a highly individual method, where success or failure depends primarily on the skill and experience of the trader. There is no reason to expect to play the violin well without some practice and natural talent. The same is true in
regarding graphical analysis, despite the caustic remarks of novice practitioners.” Jack Schwager ©
Jack Schwager Technical Analysis
- 12 January 2016, 20:11
- Babylen
- 3 books
Undoubtedly, the book is very useful and interesting. Clear recommendations and a good, clear style of presentation make the book a pleasure to read.
During the course of the book, Jack Schwager introduces the reader to the basics of technical analysis, accompanying everything with charts.
I highlighted these rules from the book as especially useful for myself.
RISK MANAGEMENT RULES
1. When trading goes bad:
(a) reduce your position size
(b) use close defensive stops
(c) do not rush into starting new deals
2. When trading goes poorly, reduce risk by eliminating losing positions rather than winning positions. This observation was also
expressed by Edwin Lefebvre in his Memoirs of a Stock Gambler: “I did all the wrong things. I maintained a losing position in cotton and closed a profitable position in wheat. There is nothing worse than trying to average out a losing position. Always close losing trades while maintaining positions showing profits.”
3. Be careful not to change trading methods after making a profit.
4. Do not enter into any trades that would seem too risky at the very beginning of the trading program.
5. Don't unexpectedly increase the number of contracts in a typical trade. (However, gradual increases as assets grow are quite normal.
6. Approach small positions with the same common sense as large ones. Never say, "It's just one or
two contracts."