Technically Speaking, April 2021

Spring has sprung in the northern climes, and as we start to return to more normal activities the stock market is still taking mighty gulps at the liquidity punchbowl provided by forever low interest rates and lots of government spending. How long can the market keep this up? That is for you and your charts to figure out. The real question, is how can we stay on top of things as they develop?

Last year, COVID stole our Annual Symposium but this year we are getting together virtually. Last autumn’s India Summit kicked things off, and at the end of this month, we will have the Americas Summit. I know it is short notice in this newsletter, but since it is online, there are no travel needs, hotels, cabs, or taking off from work. See the announcement below.

This month, we acknowledge this year’s Charles H. Dow Award winner Makenna Barbara with a brief summary of the paper and this month’s interview. We also look back in Association history to the first discussions on getting the CMT designation the respect it deserves and the Series 86 Exemption for technicians. This was a very big deal. CMT co-founder Ralph Acampora takes us back to those discussions in 2004.

We’ve also got the CMT Annual Meeting coming up with elections for new officers and Board members. Association President Scott Richter sets that up in his monthly letter, and the full meeting agenda is published later in this edition.

Don’t forget Association goings-on and this month’s podcast episode featuring Jeff DeGraaf.

Also, we still want your old photos of seminars, meetings and even the old favorite annual seminars at the beach. Got a book to recommend? A new charting software package? We could use a volunteer to write an occasional book or software review, too.

Until next month!

Michael Kahn, CMT

Editor

What's Inside...

President’s Letter

Elections Are Here…Get Ready to Vote!

It’s that time of year again – time to cast your vote for the...

Read More

2021 Americas Summit

Join the CMT Association community at the 2021 Americas Summit on April 29th & 30th! Featuring a slate of industry-leading...

Read More

Annual Membership Meeting

The Annual Membership Meeting of the CMT Association, Inc. is scheduled to take place on Tuesday, June 15, 2021. Online...

Read More

2021 Charles H. Dow Award Winner – Makenna Barbara

The CMT Association has awarded the 2021 Charles H. Dow Award to Makenna Barbara for The Efficacy of Modified Momentum...

Read More

Fill the Gap: The Official Podcast of the CMT Association

Episode 4: Jeff DeGraaf – Streaming Now

As the discipline of technical analysis has evolved, so have the practitioners. Episode...

Read More

This Month in CMT History

The fight for recognition for the CMT designation may have been one of the biggest accomplishments of the CMT Association....

Read More

Member Interview - Makenna Barbara

In this month’s interview, we break protocol and speak with the Dow Award winner who is not yet a member...

Read More

Membership News

Members on the Move

The CMT Association would like to congratulate the following members on their new positions:

William Yii,...

Read More

President’s Letter

Elections Are Here…Get Ready to Vote!

It’s that time of year again – time to cast your vote for the proposed slate of nominees that will serve on the CMT Board of Directors. You should have received an email notifying you of the date and time of our upcoming Annual Meeting, as well as the proposed slate of candidates for Director At Large and Board Officers. Voting will begin on May 13th.

Why should I care about who’s on the Board, you ask? Perhaps you have wondered, what’s so important about the Board? What does the Board even do???

First, a bit of history. In the early days, when we were known as the MTA, all of the operations of the Association were performed by volunteer board members. It made sense to run things lean, since we were small. As the CMT Program grew, and with it the number of members, it was important to make sure the day-to-day operations were executed correctly, which required the focus of a full-time staff member. Then in 2005, FINRA granted the Series 86 exemption to technical research analysts who passed the CMT Level II exam, and we hired our first Executive Director. We also hired a CMT Program Director, who, along with the Board and the Curriculum and Test Committee members, worked to build the Program into the world-class credential it is today.

Fast forward to today, the Board’s responsibilities have evolved from managing the day-to-day operations to providing oversight and governance. The Board spends a lot of time making sure Members’ dues and CMT Program fees are deployed prudently and are aligned with the long-term strategic goals of the Association. We also help the Executive Director, CMT Program Director, and other staff members to identify and plan strategic initiatives that will ultimately benefit members. For example, the creation of our India Office, which is part of our APAC expansion, was the result of discussion and planning by the Board of Directors and staff. Our efforts to enlist Board members from outside of the U.S. to aid in our expansion plans and broaden our perspective were also a strategic initiative of the Board. The Board also plays a large role in the finance, budgeting, and annual audit functions.

It’s important to mention how diligently the Board has worked to improve our refreshment process over the past 10 years. We aim to leverage CMT members’ diverse skills, experiences, perspectives, and qualifications, while also tapping the energy and enthusiasm of volunteers who have clearly demonstrated a commitment to the Association. Better Board members make for better governance and decisions! I can say without hesitation that our Board is staffed with smart, dedicated people that want to make a difference for the CMT Association.

So, for a second time, why is the Board and your vote important? It is important because it affirms your participation in the leadership and stewardship of the CMT Association. Please be a part of this process and exercise your vote.

Let’s now move to our current election. After a careful candidate consideration process, the Board is asking you to approve five nominees to the position of Director At Large. They have all demonstrated a passion for volunteering for our organization and bring unique skills that broaden the capabilities of the Board as a whole. This year’s proposed slate includes:

  • Karen Benefiel, CMT, CPA
    Karen will be new to the Board this year, bringing professional experience in Accounting and Audit through her CPA designation and prior job experience.
  • Akira Homma, CFA, CMT, CFTe, MSTA, FRM, CIIA, CMA
    Akira joined the Board in 2020 to fill an open board seat, but will now begin his first full term. As the Board’s only Director from Japan, Akira brings tremendous experience in APAC financial markets, as well as prior board experience including the CFA Society of Japan and the Nippon Technical Analysts Association.
  • William Kelleher, CMT, CFA
    Bill joined the Board in 2015 and has led the CMT’s Annual Symposium Committee since 2012, and advised on the portfolio of events globally. His risk management, marketing, and overall business operations experience have been valuable assets to the Board.
  • David Lundgren, CMT, CFA
    Dave joined the Board in 2018. As Chair of the Advocacy Committee, he led the formation of the Association’s current mission statement. In addition to his previous occupations as an analyst and PM, he also has experience in academia, having taught graduate-level courses in TA.
  • Robert Palladino, CMT
    This will be Rob’s second term on the Board. Having initially joined as Secretary and serving three years in that role, the Board is proposing Rob step into the role of Vice President this year. Yeoman’s work going on behind the scenes – Rob has been instrumental in planning and executing many initiatives.

I have a high level of confidence in those nominated to continue the hard work necessary to propel our organization forward. I encourage you to vote to approve the proposed slate of Directors and Officers. As stewards of the Association, the Board and I strongly believe that transparency and responsiveness to Members’ input are key to our success as leaders and to the success of the CMTA. Your vote matters!

I also want to encourage you to reach out to me or the other Board members with your opinions and suggestions. Surprising to some – we actually listen! We highly value your perspective, and our ultimate goal is to improve the value you receive by being in the CMT Association.

Be well. I hope you trade and invest profitably.

Contributor(s)

Scott G. Richter, CMT, CFA, CHP

Scott Richter, CMT, CFA, CHP is a senior portfolio manager for Westfield, which manages over $4B in AUM.  He is the lead portfolio manager for alternative assets and is also responsible for investments in the energy and utility sectors.  He was formerly...

2021 Americas Summit

Join the CMT Association community at the 2021 Americas Summit on April 29th & 30th! Featuring a slate of industry-leading analysts, the Americas Summit is uniquely adapted to a digital-first experience. This event will take place fully online, covering four distinct themes over two days and featuring experts in each thematic topic presenting each day.

The four themes will encompass US equity markets as well as key global indices, digital and fiat currencies, Treasury yields and rates as they impact other asset classes, and the Commodities space. Expect to leave with cutting edge tools, trading strategies and actionable insights to improve your investment decisions.

Dates

Thursday, April 29, 2021

Presentations this day will focus on Treasury Yields and rates as they impact other asset classes and on digital and fiat currencies. A key theme of these sessions will be to unpack historical sensitivity or resistance to inflationary forces.

Friday, April 30, 2021

Presentations on this day will focus on cross-asset signals coming from the metals and soft commodities, and on the US Equity markets & Key Global Indices.

Times for both days

10:00 AM – 12:30 PM ET (GMT-4:00)
2:00 PM – 4:30 PM ET (GMT-4:00)

Early Registration

Non-Members                                             $75

Members, Students, Candidates, &

Academic Partner Program schools           Free

Registration Deadline                                 April 21, 2021

Standard Registration

Non-Members                                             $100

Members, Students, Candidates, &

Academic Partner Program schools           Free

Registration Deadline                                 April 30, 2021

Confirmed Speakers and Registration at https://cmtassociation.org/event/americas-summit/?instance_id=696

Contributor(s)

Tyler Wood, CMT

Tyler Wood serves as Managing Director of CMT Association with the aim of elevating investors’ mastery and skill in mitigating market risk and maximizing return in capital markets through a rigorous credentialing process, professional ethics, and continuous education. He is a seasoned business...

Annual Membership Meeting

The Annual Membership Meeting of the CMT Association, Inc. is scheduled to take place on Tuesday, June 15, 2021. Online proxy voting for the annual meeting will open May 13, 2021 and run through June 13, 2021. You will receive an email invitation with detailed instructions for voting on May 13, 2021.

The 2021 Annual Membership Meeting will be conducted entirely online; the link to register is included below. The Annual Meeting is open to all Members of the CMT Association, who are welcomed to attend via online webcast.

Annual Meeting Details and Registration

Date: June 15, 2021

Time: 8:30 AM EDT

Location: Please register using the link below for 2021 CMT Association Annual Membership Meeting to be held electronically on June 15, 2021 at 8:30 AM EDT.

Please contact Marie Penza, CMT Association Member Services Director, at 646-695-3008, or by email at marie@cmtassociation.org with questions.

Agenda

Order of Business

Approval of the Minutes of the June 10, 2020 Annual Meeting

Reports by the CMT Association

Scott Richter, CFA, CMT, CHP, President

Alvin Kressler, Executive Director & CEO

Election of CMT Association Directors for fiscal year starting July 1, 2021

In accordance with the CMT Association Constitution, the CMT Association Leadership Development Committee has presented the following slate of candidates for Director positions for terms as indicated below. Members should vote “Yes”, “No”, or “Abstain” for the recommended slate.

Elected to 3-year terms beginning on July 1, 2021

Karen Benefiel, CMT, CPA

Akira Homma, CFA, CMT, CFTe, MSTA, FRM, CIIA, CMA

William Kelleher, CMT, CFA

David Lundgren, CMT, CFA

Robert Palladino, CMT

Election of CMT Association Officers for fiscal year starting July 1, 2021

In accordance with the CMT Association Constitution, the CMT Association Leadership Development Committee has presented the following slate of candidates for Officers for a 1-year term beginning on July 1, 2021. Members should vote “Yes”, “No”, or “Abstain” for the recommended slate.

President:

Brett Villaume, CMT, CAIA

Vice-President:

Robert Palladino, CMT

Treasurer:

Glen Martin, CMT

Secretary:

John Kolovos, CFA, CMT

Approval of CMT Association Bylaws

Proposed changes to the Bylaws are being put forth for member approval at the 2021 Annual Membership Meeting. These changes reflect the creation of the Governance Committee, which replaces and supersedes the Leadership Development Committee, and other changes beneficial to the Association. A draft of proposed changes will be provided to members in advance. Members should vote “Yes”, “No”, or “Abstain” for the adoption of the Bylaws as amended, June 15, 2021.

New Business

Adjournment

Register at https://register.gotowebinar.com/register/7672466219617775120

Contributor(s)

Robert Palladino, CMT

Robert Palladino, who holds a Chartered Market Technician (CMT) designation, is a senior foreign exchange trader for JPMorgan Chase with experience trading foreign exchange, commodities, and interest rate products, including derivatives. His foreign exchange career has allowed him to work in Hong...

2021 Charles H. Dow Award Winner – Makenna Barbara

The CMT Association has awarded the 2021 Charles H. Dow Award to Makenna Barbara for The Efficacy of Modified Momentum Based Technical Indicators on U.S. Equities: A Study of Parabolic SAR. The judging committee selected her submission as the winning paper in recognizing comprehensive research and analysis in making modifications to an existing indicator and testing the performance. She has been awarded $5000 for winning the competition.

The author’s paper extends the existing literature on momentum-based trading strategies by investigating the Parabolic Stop and Reverse (PSAR) indicator, designed to determine the direction of an asset’s momentum direction. Identifying indicator drawbacks in sideways markets, the paper introduces modifications designed to reduce false signals. The resulting new indicators are the Support PSAR, which provides signal confirmation, and the Decelerated PSAR, which slows the signal generation during trendless market periods.

When testing the performance of the new strategies versus the S&P 500 and NASDAQ Composite, the author takes into account transaction costs and data mining bias. She then compares the cumulative returns generated by the new trading strategies to a passive Buy and Hold strategy, as well as the original PSAR strategy. The strategies are analyzed over several time periods, using in-sample and out-of-sample tests and accounting for transaction costs. The research is thorough, objective and well documented.

In reviewing the results, the author explains that, “the Buy and Hold strategy is the superior strategy as far as cumulative returns are concerned, when only long positions are considered. However, the results also suggested that the newly modified Decelerated PSAR strategy has been a semi-successful improvement upon the original PSAR strategy.” The author concludes with several suggestions for further research.

We congratulate Makenna Barbara for an excellent paper that is well deserving of the award!

See the interview with Makenna in this edition of Technically Speaking.

Contributor(s)

Timothy Hayes, CMT

Timothy Hayes, CMT, is NDR’s Chief Global Investment Strategist. He has been with the firm since 1986. Tim directs NDR’s global asset allocation services, develops strategy and major investment themes, and establishes NDR’s weightings for global asset allocation, presenting his views on...

Fill the Gap: The Official Podcast of the CMT Association

Episode 4: Jeff DeGraaf – Streaming Now

As the discipline of technical analysis has evolved, so have the practitioners. Episode #4 of Fill the Gap features one of Wall Street’s current icons of market research – Jeff deGraaf, CMT, CFA, who is the founder and Chairman of Renaissance Macro Research LLC. In this interview, Jeff dives deep into the quantifiable data-driven approach he and the RenMac team leverage towards understanding markets. Jeff reveals some of the spurious pitfalls of data science, how RenMac separates signal from noise, and why their team always returns to price before making any investment recommendation.

Jeff has been one of Wall Street’s most influential macro-based analysts over the last 20 years, consistently ranked by I.I. magazine since 2002, and a member of Institutional Investor’s exclusive Research Hall of Fame. Prior to founding RenMac, Jeff cut his teeth at Merrill Lynch in the 1990s, then Lehman Brothers for 10 years where he served on the firm’s investment policy committee as a Managing Director. In early 2007, Jeff moved to ISI as an Executive Managing Director, also serving on the firm’s management committee and heading the firm’s investment policy committee.

Subscribe and listen to the podcast at https://cmtassociation.buzzsprout.com/

Tune in on your favorite listening service – each monthly episode will be released on the first Friday of the month and will be available on Apple, Spotify, Google Podcasts and wherever podcasts are found.

Contributor(s)

Jeff deGraaf, CMT, CFA

Jeff deGraaf, who holds a Chartered Market Technician (CMT) designation, is the founder and Chairman of Renaissance Macro (RenMac), as well as the firm’s Head Technical Analyst. He has become one of Wall Street’s most influential macro-based analysts over the last decade;...

This Month in CMT History

The fight for recognition for the CMT designation may have been one of the biggest accomplishments of the CMT Association. The CMT is currently one of two designations recognized by FINRA for the series 86 exemption. Here is how that exemption all got started.

Back in April 2004, I received an urgent call from David Krell, CMT, who told me that I had to respond immediately to the newly released Sabanes-Oxley law, which stated that all Wall Street analysts had to take two new tests: Series 86 and Series 87. Alternatively, they could have the equivalent of levels one and two of the CFA designation.

When I returned from Minnesota, Dave and I planned our response. We decided that he would handle the bureaucratic side of things and I would cover all of the technical items. Dave got us an appointment with the head of the NYSE.

At this very important meeting, we mentioned that technicians should be tested with their own exam. We were getting nowhere until I mentioned the word “psychometrics” – the theory and technique of psychological measurement. And the person sitting across the table asked who was our psychometrician? I gave him the lady’s name from the company that does our exams.

Then the head guy asked for all the years of our past exams. Of course, we only had two years’ worth of exams because I only started outsourcing the exam after 9/11. And when I told him that all of our records were in Tower One, his face turned white as a ghost, and he said that they would get back to us soon.

When we were outside the Exchange, I asked David, why are you getting so involved with all of this? And I will never forget his response: “Ralph, this is the right thing to do.”

For the next eight months I dedicated myself in creating “The Body Of Knowledge On Technical Analysis” because they insisted upon it. Up to that time, there was no such thing. But with the decades of my teaching at the New York Institute of Finance, I had a good start.

Then the big meeting on Friday, December 17, 2004; Dave Krell; Ken Tower, CMT; Barry Sign, CMT CFA; and I presented at the NYSE, before about eight lawyers from the NYSE, FINRA and the SEC. Dave spoke for three minutes about the history of technical analysis; Ken spoke for three minutes about the history of the MTA, Barry spoke for three minutes about our technical exams and I had the last five minutes.

I started out by saying, “Imagine if you lawyers were mandated to take the Medical Boards and assuming you passed it, you would never use this knowledge in your daily work as financial lawyers. Well, that’s what you’re asking us to do. Please, we want to be tested, but test us on our body of knowledge.”

One of the lawyers jumped up with a chart in his hand and asked: “What is fact on this chart?” We immediately responded: “Price is a fact.” Then I followed up by saying, “Earnings (fundamentals) are estimates, you restate earnings but you never restate this chart!”

The lawyer responded, “That’s the best answer I ever heard.”

The rest is history, and that is how that day, December 17, 2004, became the most important date in modern Technical Analysis history. The CMT was elevated to the level and respect of the CFA.

Two months later, on February 8, 2005, the Chartered Market Technicians Association (CMT Association) was informed that FINRA submitted a rule filing with the Securities and Exchange Commission to accept the CMT Level 1 Exam and CMT Level 2 Exam as an alternative to the Series 86 exam, required of financial analysts.

Here is a link to the panel discussion presented at the 2015 Annual Seminar detailing what happened. https://cmtassociation.org/video/25th-anniversary-of-1st-cmt/

Contributor(s)

Ralph Acampora, CMT

Ralph Acampora, CMT is a pioneer in the development of market analytics. He has a global reputation as a market historian and a technical analyst, providing unique insights on market timing and related investment strategy issues to a wide audience within the...

Member Interview - Makenna Barbara

In this month’s interview, we break protocol and speak with the Dow Award winner who is not yet a member of the Association. She assures us that she will be joining soon!

Please tell us what you do professionally.

I currently work as an Acquisitions Analyst for MDH Partners supporting both the Southeast and Southwest region. My day to day consists of modeling industrial real estate acquisitions utilizing both Excel and Argus.

How did you get there?

After earning my Masters in Banking and Finance from King’s College, London, I knew I wanted to get a job in finance, but I did not have much of a plan beyond that. My undergraduate degree was in environmental science and I thought all of my previous experience would be of little to no value; but that was a naïve view. I slowly came to realize that I had picked up some very useful skills along the way – such as how to analyze data, come up with original inferences, and most importantly use that data to convey a clear message. Those skills, along with quite a bit of luck, helped me land my current role at MDH Partners where I get to work with some truly amazing people. The group adds value in everything they do; whether that be empowering younger colleagues like myself or creating superior risk adjusted returns for our LPs.

Who was an early mentor in your career?

I have been very fortunate to have grown up surrounded by so many incredible people that have helped me get to where I am today. That being said, I would be remiss to not use this opportunity to spotlight a handful of people in particular. First and foremost, my family, they have supported me every step thus far. Secondly, Raymond Sheley, who was the one who first introduced me to the world of commercial real estate and all the possibilities that it offers. Lastly, my coworkers at MDH Partners have poured so much time and energy into helping me progress and learn that I can’t help but think of some of them as mentors – whether they know it or not!

What book/author was most influential in helping you understand TA?

Julie R. Dahlquist, who first put the CMT and the Dow Award on my radar, co-authored a textbook on technical analysis that ended up being one of my go-to resources while I wrote my paper. The name of the book is “Technical Analysis: The Complete Resource for Financial Market Technicians” and it is incredibly detailed while remaining approachable.

What do you like to do when you are not looking at markets?

I have always had a passion for travel and cooking. However, in light of recent events, I have found myself doing more of the latter!

What was compelling about the Dow Award?

The Dow Award represented the perfect challenge and opportunity to me. I had first encountered technical analysis during my master’s program in banking and finance, and I was instantly intrigued. I read as many books and articles as I could get my hands on. Afterwards, I wanted a way to showcase what I had learned and subsequently written on the subject. In my mind, the Dow Award was a great way to get feedback on the progress I had made from a panel of highly distinguished judges. Never in my wildest dreams did I expect to win the award! In fact, this has been such a whirlwind that I still have not actually made the time to apply to be a member of CMT Association. That being said, I cannot wait to join this wonderful community and continue to learn on the subject of TA.

Contributor(s)

Michael Kahn, CMT

Michael Kahn, who holds a Chartered Market Technician (CMT) designation, is a seasoned financial services strategist, analyst, columnist, educator and speaker.  Michael has been working with charts and technical analysis since 1986. He is the author of three books on technical analysis...

Membership News

Members on the Move

The CMT Association would like to congratulate the following members on their new positions:

William Yii, CMT, Chief Investment Officer at Airo Malaysia

James Chen, CMT, Vice President, Head of Content Studio, U.S. Wealth Management at J.P. Morgan

Daniel Russo, CMT, Portfolio Manager at Potomac Fund Management, Inc.

The next time you login to the CMT website, please take a moment to update your profile including your address. If you need your company’s name updated, please send the information to admin@cmtassociaton.org.

CMT

One of the biggest problems that candidates encounter when taking a remote proctored exam are the firewalls and virus protections that have been installed on their computer, as these can prevent the exam from being downloaded.

To prevent this problem from occurring on your test date, please be sure to read “Dealing with Firewalls Before Your Remote Exam” (https://cmtassociation.org/chartered-market-technician/cmt-exams-remote-proctoring/).  This section has instructions on how to disable your firewalls and virus securities for MAC OS and Windows OS.

The instructions apply to both personal and company computers.  Company computers require admin rights to disable firewalls, so be sure to contact your IT Department well ahead of your exam date.

Candidates can report connectivity issues to Prometric when taking the exam. After Prometric runs a diagnostic report and confirms the disruption with the CMT Association, candidates will receive one opportunity to take the exam again remotely or at a test center, dependent on appointment availability.

The CMT Association would like to congratulate the following members who received their CMT Designation in March 2021.

  • Venkat Annavarapu
  • Jason Benowitz
  • Tony Chalmers
  • Harrison Cross
  • Brian Dightman
  • Richard Ducat
  • Jeffrey Eveleth
  • Craig Farley
  • Robert Foltynowicz
  • Matthew Hornbach
  • Boris Jurczyk
  • Michael Lowery
  • Avinash Nile
  • Ugur Orhon
  • Alexander Parfenov
  • Krishna Patel
  • Talal Qatato
  • Jose Quasar Elizundia
  • Aaron Say
  • Connor Sheehy
  • Troy Trentham
  • Priyank Upadhyay
  • Christopher Watson
  • Brady Raanes

Contributor(s)

Marie Penza

Marie Penza serves as the Director of Member Services for the CMT Association.