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Technically Speaking, February 2011

Letter from the Editor

Technical analysis has a rich, and little studied, history. MTA members are doubtlessly aware of this and understand that their membership helps them unlock a great deal of the available history. Thousands of books fill the shelves of the MTA library, some of them are the original works in their field of study. This is one of the most popular benefits of membership. As technology changed, the historical archive of any field has expanded to include videos as well. Taking advantage of the leading edge of technology, the MTA has captured the thinking of some of the leading technicians in the world and provides videos of these presentations. In recent issues of Technically Speaking, we have been featuring video presentations that are available in the archives section of the member’s section of the MTA web site. We believe there is great value in reviewing these and find that the true principles of technical analysis are timeless. Spending an hour looking at the current thinking of technicians from the time of a market

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Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

What's Inside...

Career Opportunities in Technical Analysis

by Sarah Westwood, CMT, CFA & Sam Levine, CMT, CFA & Gordon Scott, CMT

Introduction While intensifying our efforts to bring value-added content to MTA members and affiliates through the Career Development Center site, we received feedback from members and affiliates...

Global Intermarket Conference and MTA CEE Chapter kick off meeting

by Laszlo Kovacs, CMT

The idea of creating a chapter for the Central and Eastern European Region was born during a warm, early summer day. I was with my fellow MTA member Mukul Pal having lunch in the City Park restaurant...

Interview with Matt Caruso, CMT

by Matthew Caruso, CMT & Michael Carr, CMT

How would you describe your job? I’m a senior pro equity trader for National Bank Financial (NBF). My task is relatively simply; trade day in and day out to maximize gains month over month while...

Bentley University Hosts Technical Analysis Introductory Course

by Dave Lundgren, CMT, CFA

In September of last year, a colleague asked me if I would be interested in participating in a “Professional Day” at Bentley University in Waltham MA. I would be a guest lecturer providing an...

ADX Indicators

by Michael Carr, CMT

On October 27, 2010, Chuck LeBeau, made a presentation called “A Study of ADX Indicators” as part of the MTA Educational Webcast series. It is available in the on demand video archives section of...

Rate of Change: A Neglected Indicator

by Amber Hestla-Barnhart & Michael Carr, CMT

We often hear about crazy questions that come up in job interviews, like “If you could be a pie, what kind of pie would you be and why?” Tweaking that question a little bit, if Rodney Dangerfield...

Announcements

MTA 2011 Annual Symposium at the New York Stock Exchange (NYSE) –Register Today! The 2011 Annual Symposium will take place on May 11th, 2011 through May 13th, 2011 at the New York Stock Exchange....

Career Opportunities in Technical Analysis

Career Opportunities in Technical Analysis

Introduction

While intensifying our efforts to bring value-added content to MTA members and affiliates through the Career Development Center site, we received feedback from members and affiliates inquiring as to where opportunities lie for practitioners of technical analysis in today’s competitive job market. When we put this question before the Career Development Committee, the answer was a relatively swift and unanimous “everywhere.” The Career Development Committee began its work by attempting to meet the query of technical analysts with answers that offer practical guidance. We began to brainstorm how to explain what opportunities existed, and where an experienced or budding technician might find satisfactory work. In our discussions it became clear that there is a wide array of opportunity, perhaps wider than many members and affiliates believe. In an environment where opportunity no longer appears quite as deep as it once was, we believe it will be worthwhile for affiliates to

To view this content you must be an active member of the CMT Association.
Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

Contributor(s)

Gordon Scott, CMT

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Global Intermarket Conference and MTA CEE Chapter kick off meeting

Global Intermarket Conference and MTA CEE Chapter kick off meeting

The idea of creating a chapter for the Central and Eastern European Region was born during a warm, early summer day. I was with my fellow MTA member Mukul Pal having lunch in the City Park restaurant in Budapest in Aug 2010. We thought of creating a regional chapter, holding a meeting, and inviting members from the region. It was an opportunity to meet fellow technicians and create a vibrant forum for generating new ideas and creations.

With this aim in mind we structured a proposal and shared it with the New York MTA team. Ideas started flowing; we discussed a conference theme, short listing speakers, developing infrastructure requirements, making logistics arrangements, arranging sponsorships, determining  costs and dates, schedules, marketing details, etc. Within weeks we had exchanged numerous emails with MTA staffers Tim, Courtney, and Shane. They not only supported the idea and assisted us in further planning, but were also

To view this content you must be an active member of the CMT Association.
Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

Contributor(s)

Laszlo Kovacs, CMT

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Interview with Matt Caruso, CMT

Interview with Matt Caruso, CMT

How would you describe your job?

I’m a senior pro equity trader for National Bank Financial (NBF). My task is relatively simply; trade day in and day out to maximize gains month over month while limiting risk. My focus is on U.S and Canadian stocks and I am free to employ any trading strategy I feel will be best. This allows for a great deal of flexibility. I am paid based on a percentage of profits and it is important that I am comfortable with the approach I am using.

What led you to look at the particular markets you specialize in as opposed to another tradable?

The easy answer is that at NBF I cannot trade other markets apart from North American equities. However, I have traded futures and commodities extensively on a personal basis. I do prefer equities, however for a number of reasons. Firstly, equities are very liquid and actively traded.

To view this content you must be an active member of the CMT Association.
Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

Contributor(s)

Matthew Caruso, CMT

Michael Carr, CMT

Michael Carr, CMT

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Bentley University Hosts Technical Analysis Introductory Course

Bentley University Hosts Technical Analysis Introductory Course

In September of last year, a colleague asked me if I would be interested in participating in a “Professional Day” at Bentley University in Waltham MA. I would be a guest lecturer providing an introduction to Technical Analysis. The audience would consist mostly of evening graduate students, but also a few undergrads and several professors. Being quite familiar with Bentley’s strong and leading edge commitment to education in the field of Finance and Investments, I was quite willing to speak with the class.

My host was Bentley Professor Anurag Pandit. He provided the following description of the class: “Students do not generally know a great deal about technical analysis. So any overview of technical analysis, its main tools, how they are used, do they work independently or with fundamental analysis and do they work better with certain asset classes like commodities and futures will be of particular interest.”

So with that, I

To view this content you must be an active member of the CMT Association.
Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

Contributor(s)

Dave Lundgren, CMT, CFA

Dave Lundgren, CMT, CFA

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ADX Indicators

ADX Indicators

On October 27, 2010, Chuck LeBeau, made a presentation called “A Study of ADX Indicators” as part of the MTA Educational Webcast series. It is available in the on demand video archives section of the MTA web site.

ADX was one of several indicators introduced in the book “New Concepts in Technical Trading Systems” written in 1978 by J. Welles Wilder. LeBeau feels it was one that didn’t achieve general acceptance quickly because it isn’t an intuitive indicator. Most indicators move in the same direction as the price trend. As prices rise, an indicator like stochastics will generally be moving higher, or a declining value of RSI is usually associated with falling prices. ADX is different.

LeBeau uses the direction of ADX to help identify the trendiness of the trend. A rising indicator indicates a trending market, and shows the trend is strengthening. Declining values of ADX indicate that the trend is

To view this content you must be an active member of the CMT Association.
Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

Contributor(s)

Michael Carr, CMT

Michael Carr, CMT

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Rate of Change: A Neglected Indicator

Rate of Change: A Neglected Indicator

We often hear about crazy questions that come up in job interviews, like “If you could be a pie, what kind of pie would you be and why?” Tweaking that question a little bit, if Rodney Dangerfield could be any technical analysis indicator he wanted to be, he’d have to pick the price Rate of Change (ROC) because it just doesn’t get any respect.

Often ignored, ROC is the most basic momentum indicator possible. It’s the basis of many widely-used oscillators including RSI, stochastics, and MACD. Yet it is not commonly cited in articles about technical analysis, maybe because of simplicity. It might be easier to sell anything with Fibonacci ratios in it, but complex tools seem to work for very few traders. Simple tools are dressed up and modified, and the ROC is hidden in several popular indicators.

ROC is usually calculated as a ratio. To find the ratio, we can

To view this content you must be an active member of the CMT Association.
Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

Contributor(s)

Michael Carr, CMT

Michael Carr, CMT

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Announcements

Announcements

MTA 2011 Annual Symposium at the New York Stock Exchange (NYSE) –Register Today!

The 2011 Annual Symposium will take place on May 11th, 2011 through May 13th, 2011 at the New York Stock Exchange. This event will feature two full days of presentations as well as two networking cocktail receptions: one at the Museum of
American Finance and the other on the floor of the New York Stock Exchange!

The following speakers have been confirmed for the event:

    • Tom DeMark (Chief Executive Officer, Market Studies, LLC)
    • Julius de Kempenaer (Director, Taler Investment Consulting)
    • Larry Leibowitz (Chief Operating Officer, New York Stock Exchange)
    • David Linton (Chief Executive Officer, Updata PLC)
    • Steve Poser (Managing Director, New York Stock Exchange)
    • More to follow!

The member discounted registration rate is $425. You may register by calling Courtney Musarra at 646-652-3300 or by clicking here.

The 2011 Annual Symposium qualifies for 15 MTA Continuing Education

To view this content you must be an active member of the CMT Association.
Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

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New Educational Content This Month

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