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Introduction 1
ONE Individual Psychology 9
1.Trading—The Last Frontier 1
2. Psychology Is the Key 3
3.The Odds againstYou 5
4.WhyTrade? 9
5. Reality versus Fantasy 10
6. Self-Destructiveness 16
7.Trading Psychology 19
8.Trading Lessons from AA 21
9. Losers Anonymous 23
10.Winners and Losers 27
TWO Mass Psychology 31
11.What Is Price? 32
12.What Is the Market? 33
13. The Trading Scene 36
14.The Market Crowd andYou 39
15. Psychology of Trends 43
16. Managing versus Forecasting 46
THREE Classical Chart Analysis 49
17. Charting 50
18. Support and Resistance 55
19. Trends and Trading Ranges 60
20. Kangaroo Tails 65
FOUR Computerized Technical Analysis 69
21. Computers in Trading 69
22. Moving Averages 74
23. Moving Average Convergence-Divergence:
MACD Lines and MACD-Histogram 80
24.The Directional System 89
25. Oscillators 95 26. Stochastic 95
27. Relative Strength Index 99
FIVE Volume and Time 103
28. Volume 103
29.Volume-Based Indicators 107
30. Force Index 112
31. Open Interest 117
32. Time 121
33. Trading Timeframes 126
SIX General Market Indicators 133
34.The New High–New Low Index 133
35. Stocks above 50-Day MA 139
36. Other Stock Market Indicators 140
37. Consensus and Commitment Indicators 142
SEVEN Trading Systems 149
38. System Testing, Paper Trading, and the
Three Key Demands for Every Trade 151
39. Triple Screen Trading System 154
40.The Impulse System 162
41. Channel Trading Systems 166
EIGHT Trading Vehicles 173
42. Stocks 175
43. ETFs 176
44. Options 178
45. CFDs 186
46. Futures 187
47. Forex 194
NINE Risk Management 197
48. Emotions and Probabilities 197
49.TheTwo Main Rules of Risk Control 202
50. The Two Percent Rule 203
51.The Six Percent Rule 208
52. A Comeback from a Drawdown 210
TEN Practical Details 215
53. How to Set Profit Targets: “Enough” Is the Power Word 215 54. How to Set Stops: Say No to Wishful Thinking 219
55. Is This an A-trade? 225
56. Scanning for Possible Trades 230
ELEVEN Good Record-Keeping 233
57.Your Daily Homework 234
58. Creating and Scoring Trade Plans 238
59.Trade Journal 243
A Journey without an End:
How to Continue Learning 249
Sources 253
Acknowledgments 257
About the Author 259
Index
