Acknowledgments p. xiii
The Case for Timing
The Secret of Timing p. 3
What and When to Buy and Sell
The Difference Between Two Stocks
What You Need
Six Primary Objectives
The Structure of This Book
Stock Timing and Fundamental Analysis p. 11
Why Buying Low and Selling High Doesn't Work
Cendant, Great Stock but Lousy Action
You Don't Have to Get Left Behind!
Buying Value Can Mean a Long Wait
The Market Is Always Right
What Does Value Really Mean? p. 21
Value Versus Price
Valuation Criteria and Normality
Valuations in the 1970s and early 1980s
Valuations in the 1990s
The Japanese Experience
Investment Trusts in the 1920s
Historical Valuations
Valuation Criteria Work As Alerts
Bull and Bear Markets p. 31
The Long-Term History of Stocks
Distortions Caused by Inflation
Major Bull and Bear Markets
Stocks Since 1957
The Risk of Buying at a Market Top
Why You Must Avoid Bear Markets
Value Fails in a Bear Market
Fashions in Investment Change p. 43
Industries Come and Go
General Motors in High Gear and Low
Coca-Cola in Low Gear and High
Digital Equipment Goes Out of the Sun
Success and Failure Come and Go
Fashions in Asset Classes Change
Where Mutual Funds Fail p. 51
Trading Versus Investment
What Do the Funds Hold?
Expert Funds
Superfund
How to Tell Long-Term from Short
Index Funds
Mutual Fund Management Fees
The Risk in Mutual Funds p. 61
A Mutual Fund Is Just Another Stock
Do You Want to Hold for That Long Term?
How the Funds Say It
Calculating Investment Returns
You Ask the Questions: Fund Quiz
You Should Do the Job Yourself
How and When to Buy Stocks
Defining a Bull Market p. 73
Upward Zigzags
W Formations: The Start of a Bull Market
W Formation: Initial Higher High
W Formation: Initial Higher Low
Zigzags Apply to All Indicators
Defining A Bear Market p. 81
Downward Zigzags
M Formations: The Start of a Bear Market
M Formation: Initial Lower Low
M Formation: Initial Lower High
Sideways Markets p. 87
Endless Chop
Trading-Range Examples
On Balance Volume (Obv): Some Innovative Uses p. 91
Volume Can Forecast Price
New Applications for OBV
Interpreting OBV
OBV and General Electric
OBV and Microsoft
OBV and Cognos
OBV and IBM
Moving Average Convergence/Divergence (Macd) p. 101
Direction and Momentum
Using MACD
MACD and General Electric
MACD and Coca-Cola
MACD and Cognos
MACD and IBM
Learn to Believe in MACD
The Building Blocks for Charts p. 111
Price Bar Action
Always Follow the Footprints
Price Rules p. 119
When to Pull the Trigger
Price Rule Principles
Conditions for All Price Rules
Price Rules
Illustrating the Price Rules
Moving Averages: Use With Price Rules p. 129
Settings for Moving Averages
Using Moving Averages
Microsoft and the Monthly Moving Averages
Buy Off the Weekly Chart
Buy Off the Daily Chart
When You Should Wait to Buy
A Stock to Sell Short
Stochastics: Overbought/Oversold Indicator p. 139
When to Buy Low and Sell High
Setting for Stochastics
How to Use Stochastics
Stochastics Applied
Trendlines, Channel Lines, and Linear Retracement p. 147
Drawing a Trendline
Drawing a Channel Line
The Dow Industrials and Linear Retracement
Trendlines Drawn Off Price Rules and Reversals
Chart Patterns to Buy p. 155
The Long-Term Breakout
Some Doldrums Never End
Eastman Kodak Breaks Out
Colgate Shows Emerging Strength
The Reverse Head-and-Shoulders
The Ascending Triangle
When to Look for Market Lows p. 165
Selling Climaxes and Double Bottoms
Stocks Above Their 200-Day Average
The Zweig Breadth Thrust Indicator
Ticks As a Selling Climax Indicator
The Line Chart for Ticks
What Else You Need to Know
Interest Rates p. 175
When Interest Rates Drive Stocks
Bonds Versus Stocks
Cause and Effect Reverse
Why Capital Investment Booms Go Bust
How to Manage Your Capital p. 183
Risk Versus Reward
Don't Invest All at Once
Keep Capital in Reserve
What Gerald Loeb Did
Have Your Cake and Eat It Too!
Routine Retracements and More Serious Ones
Give Winners Room to Breathe
Don't Average Down!
Think Positively in a Bull Market
Think Defensively in a Bear Market
Separate Income from Capital
Capital Management Summary
Protect Capital With a Stop-Loss p. 195
The Initial Protective Stop (IPS)
Why You Need a Stop
How to Set the Initial Protective Stop
The IPS in Practice
The Weekly and Daily Charts for Stops
Mind Good-till-Cancelled Stops
Stops for Protecting Profits p. 205
The Trailing Protective Stop (TPS)
The Higher-Low Stop
The Higher-Low Stop in Practice
The Price Reversal Stop
The Price Reversal Stop in Practice
The Trendline Stop
The Trendline Stop in Practice
Stops When You Really Need Them
Be Prepared to Buy Back
Finding the Best Stocks p. 217
Where to Start Looking
Technical Alerts That Work
Fundamental Alerts That Work
Fundamentals That Don't Work
Bringing It All Together
Entry Checklist: Bringing the Signals Together p. 231
Confirming Indicators
Negating Indicators
Case Study: Buy Into an Established Trend p. 241
The Entry Checklist for Citicorp
Case Study: Buy a Long-Term Breakout p. 253
The Entry Checklist for Schlumberger
Case Study: Buy Into a Rapidly Moving Market p. 265
Don't Think It's Too Late
The Entry Checklist for Cognos
When to Sell and When to Sell Short
When to Sell p. 281
Reasons to Sell
Warning Signs
Selling Stocks Short p. 289
Sell First, Then Buy
Short-Sellers Perform a Service
Risk and Reward
Stocks Not to Sell Short
Short Sale Candidates
The Short Interest Ratio
Short Sale Procedures
Short Sale Margins
Calculate the Stop-Loss
Start Short Sales Slowly
Pyramiding Margin
Entry Checklist: Sell Short p. 303
Differences Compared with Buying
Confirming Indicators
Negating Indicators
Case Study: Sell Short Into an Approaching Waterfall p. 311
IBM Takes a Slide
The Entry Checklist
Case Study: Sell Into an Emerging Bear Market p. 323
K Mart Makes a Top
The Entry Checklist
Case Study: Short Into a Vacuum Crash p. 337
What Happened in October 1987
The Entry Checklist
Prepare for the Next Bull Market
Different Perspectives
How to Use Options p. 353
Trade with the Professionals
Professionals Sell (Write) Options
Professionals Also Sell Put Options
Sell Naked Options against the Trend
Advantageous Strategies
Market Myths I p. 359
The Savings Myth
The Myth of Corporate Profits
The Myth of Pension Profits
The Myth of Professional Integrity
The Myth of EBDITA
The Myth of Corporate Buybacks
The Myth of Stock Options
Market Myths II p. 367
The Myth of New Eras
The Myth of Defensive Stocks
The Inflation Myth
The Myth of the Fed's Credibility
The Myth of Confidence
The Myth of Baby Booms and Baby Busts
The Market Fuel Myth
The Devalued Currency Myth
The Natural Resources Myth
The Winning Attitude p. 377
The Psychological Challenge of Success
Sins to Avoid
Capital Should be Forever p. 383
Make Money and Also Keep It
There Are Times to Stand Aside
The Paradox of Cash
The Best Decisions Are Often Difficult
Buy the Strong; Sell the Weak
Taking Losses
Use Stops
Sometimes You Have to Pay Taxes
The Foremost Rule: Preserve Capital!
How The System Worked in 1998 p. 391
Index p. 395