I am reading a fantastic book on trading, first published in 1924, by Richard D. Wyckoff, titled "How I Trade and Invest in Stocks & Bonds". Although most of the examples in the book pertain to stocks, the insights into the nature of trading are relevant no matter what instrument you choose to trade.
I am particularly drawn to the authors' appreciation of the ebb and flow nature of markets and how this perspective can be used to great effect.
"It is difficult to over-emphasize the importance of studying the technical position, particularly when making a speculative commitment. Many people may say, "What is a weak or a strong technical position?" My reply is, in brief, that a stock is in a weak technical position on the bull side when it has been purchased and is held by a large number of outside speculators; when most of these are looking for a profit; when the price of the stock has advanced to a point where no further buying can be stimulated for the time being. It stands to reason that when buying power is exhausted a stock must decline, no matter how strong its finances, management or earning power."
"On the other hand, a stock is in a weak technical position on the short side when the bears have exhausted their ammunition by selling all they can afford and when the buying power of investment and speculative purchasers is such that it resists the pressure of the bears; in other words, when demand overcomes supply. The weakness in such a position is found in the fact that all those who are short are potential bulls; they must, sooner or later, cover their commitments in order to close their trades. They do not wish to remain short indefinitely."…. "Bears, after they have sold short are an element of strength, not of weakness."
Perhaps the nature of all markets is best described by the Chinese Yin Yang symbol.
In every bull move, and in every bear decline, are the seeds of their own destruction.
Approval - You Dont Need It People always judge others, and so it should not come as a shock if someone judges you negatively. Learn what comments starting with 'you are too...' really mea...
Submitting To Directories: A Comprehensive Guide Why submit to a Directory? Every webmaster is looking for ways to improve their website's visibility, and one great way is by getting listed in the major web di...
Backyard Landscaping When most people think of landscaping, they think of a beautifully decorated front yard. But what about the back? There are many reasons why you should consider...
The As Have it So many academic assholes but few who use all their senses to have ral wisdom.
Doing Your Lifes Work Most people want to do their life's work. Some people are able to separate work completely from life and be happy doing anything, but this is not the norm. I on...
To Hire or Not to Hire a Website Designer In the early years of the internet the actual design of a website was either very basic or had to be done using a software package that needed a specialist to u...
5 Critical Tests Every Press Release Must Pass The press release is still the most common way to "pitch"
journalists when you're trying to get them to give you
free publicity. But over 95 percent of all p...
Networking Online - Marketing Made Easy Networking and making business contacts is one of the toughest aspects of running a home-based business, but also one of the most successful to develop your bus...
Brazil--Comments by a Gilliam Fan a Little Too Late Either I am one of the darkest people ever or this was not one of the darkest movies ever made as its own packaging claims. I have vowed to myself not to use th...
Wise Woman Ways to Boost Your Energy Almost every woman has, at one time or another, felt so fatigued she wanted to cry. Susun Weed offers Wise Woman Ways to deal with fatigue.
Bodybuilding Protein Properly timed protein intake is key to increases in muscle size and strength. Find out why breakfast is not always the best meal of the day...
Crisis Management: The Most Basic Of Needs Crisis management is something that every individual needs to consider. Whether you are preparing yourself for a crisis situation or if you are responsible for...
Why Not Lead With Emotions? We associate leadership with someone who has vigor and vision, who is assertive and influential and who is a great communicator and therefore the word emotions ...
Sales Pipeline Forecasting Is There A Better Way? In a recent survey of over 1400 technology companies Sales Directors and MD's said that they felt the key to gaining insights into why more and more selling eff...
The Top 10 Life Lessons from Golf Golf is an amazing mirror of life. Yes, other sports provide life lessons as well, but golf happens to be my favorite sport and the one I understand the best. I...
Print this page