This revised and updated version of the best-selling book, Technical Analysis of Stock Trends, 10th Edition, presents proven long- and short-term stock trend analysis enabling investors to make smart, profitable trading decisions. The book covers technical theory such as The Dow Theory, reversal patterns, consolidation formations, trends and channels, technical analysis of commodity charts, and advances in investment technology. The book also includes a comprehensive guide to trading tactics from long and short goals, stock selection, charting, low and high risk, trend recognition tools, balancing and diversifying the stock portfolio, application of capital, and risk management. This sharpened and updated new edition offers patterns and charts that are tighter and more illustrative, including modifiable charts. Expanded material will be offered on Pragmatic Portfolio Theory as a more elegant alternative to Modern Portfolio Theory; and a newer, simpler, and more powerful alternative to Dow Theory is presented.
Table of Contents
Part I: Technical theory
1. The technical approach to trading and investing
3. The Dow Theory
4. The Dow Theory’s defects
5. Replacing Dow Theory with John Magee’s Basing points Procedure
6. Important Reversal Patterns
7. Important Reversal Patterns: continued
8. Important Reversal Patterns: the Triangles
9. More important Reversal Patterns
10. Other Reversal phenomena
11. Consolidation Formations
13. Support and Resistance
14. Trendlines and Channels
15. Major Trendlines
16. Technical analysis of commodity charts
17. A summary and concluding comments
Part II: Trading tactics
18. The tactical problem
19. The all-important details
20. The kind of stocks we want: the speculator’s viewpoint
21. Selection of stocks to chart
22. Selection of stocks to chart: continued
23. Choosing and managing high-risk stocks: tulip stocks, Internet sector, and speculative frenzies
24. The probable moves of your stocks
25. Two touchy questions
26. Round lots or odd lots?
27. Stop orders
28. What is a Bottom and what is a Top?
29. Trendlines in action
30. Use of Support and Resistance
31. Not all in one basket
32. Measuring implications in technical chart patterns
33. Tactical review of chart action
34. A quick summation of tactical methods
35. Effect of technical trading on market action
36. Automated trendline: the Moving Average
37. The same old patterns
38. Balanced and diversified
39. Trial and error
40. How much capital to use in trading
41. Application of capital in practice
42. Portfolio risk management
43. Stick to your guns
WHC Bassetti is the Editor and Coauthor of the classic reference, Technical Analysis of Stock Trends, 10th Edition, first written by Robert D. Edwards and John Magee in 1948. Mr. Bassetti traded as a student and client of John Magee in the 1960s, beginning a long, distinguished trading career encompassing virtually all of the financial markets, stocks, bonds, options and futures.
In 1972, as a Principal and Vice President of California’s first licensed commodity trading advisor he pioneered computerized trading systems and traded professionally for individual and institutional clients. His company was one of the first to manage capital for Merrill Lynch, Dean Witter et al and he and his partners created and managed some of the first commodity mutual funds.
In 1984 he was appointed CEO of Options Research Inc., a company founded by Blair Hull of Chicago’s Hull Trading Company, formerly the largest market maker on the floor of the CBOE. ORI was one of the first if not the first, companies to computerize the analysis of options and futures. Clients for analytical and portfolio services included Morgan Stanley, First Boston, and Kidder Peabody et al. Mr. Bassetti’s organization managed options arbitrage capital compiling a brilliant record during the market crash of 1987, and traded as a market maker with a seat on the Pacific Stock Exchange.
A graduate of Harvard University and a former NASA systems engineer, Mr. Bassetti is currently Distinguished Adjunct Professor of Finance and Economics at Golden Gate University, San Francisco, Editor of the John Magee Investment Series for St. Lucie Press and a practicing technical analyst.
In spite of his decades of work in computerized trading systems, Mr. Bassetti’s favorite analytical tool remains a ruler, a tool he teaches graduate students and the general public in his monthly 2-1/2 day seminars at Golden Gate University.