Technically Speaking, February 2014

LETTER FROM THE EDITOR

This year’s Annual Symposium will focus on the fusion of technical analysis with fundamental valuation, behavioral finance, macroeconomics and quantitative methods. The work of three of the scheduled speakers is included in this month’s newsletter.

Steven Leuthold explains his investment strategy for the next year and readers can ask him for an update in April at the Symposium. Steve is the only individual who has received the
Charles H. Dow Award from the MTA and the Graham and Dodd Scroll Award from the CFA Institute. Dr. Ben Hunt relies on game theory to understand the markets and the economy. Dr. Tucker Balch, a featured speaker, presents the results of research into buying and selling by company insiders that he completed with Scott Strong. Insider trading information is a form of sentiment analysis that technical analysts have used for many years.

We also have several other articles this month including Tom McClellan’s look at VIX ETNs and John Bougearel’s review of the current state of the market. Tom presents facts to demonstrate why long-term investors should avoid an ETN that is designed specifically for short-term traders. John presents some interesting chart patterns and provides a forecast based on technicals and fundamentals. He includes an overview of the macroeconomic environment that exists now and at several key turning points in the market. Please send any feedback or work you’d like to share through the newsletter to editor@mta.org.

Michael Carr

What's Inside...

2014 OUTLOOK

Editor’s note: This is a reprint of a letter to clients which discusses successes and missteps along with an investment...

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IT WAS BARZINI ALL ALONG

Editor’s note: This was originally published in a newsletter by Ben Hunt and is reprinted here with permission.

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VIX ETN NOT RIGHT FOR INVESTORS

Editor’s note: This was originally published as a Chart in Focus by McClellan Financial Publications on January 02, 2014 and...

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ASSESSMENT OF INSIDER TRADING INFORMATION FOR INVESTMENT STRATEGIES

Editor’s note: This was previously published at The Augmented Trader and is reprinted here with permission. Dr. Balch will be...

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INTERVIEW WITH BRUCE KAMICH, CMT

How would you describe your job?

My job and current passion is teaching technical analysis (TA). I am an adjunct...

Read More

NY FED MODELS FORECASTING EXCESS RETURNS THROUGH 2018 ENCOUNTER THE YEAR OF THE HORSE, VALUATION MEAN REVERSIONS, & GEORGE LINDSAY’S THREE PEAKS AND A DOMED HOUSE

The NY Federal Reserve has an equity research department. Their research department determined in 2013 that “stocks are cheap” and...

Read More

2014 OUTLOOK

Editor’s note: This is a reprint of a letter to clients which discusses successes and missteps along with an investment strategy for the future and is reprinted here with permission.

For most individual and professional investors, the biggest unexpected surprise of 2013 was the huge surge in the U.S. stock market. Those full year gains of 26% for the DJIA, 30% for the S&P...

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)

Steve Leuthold

Steve Leuthold has been an investment strategist, manager, and researcher for over 45 years. He is Founder of The Leuthold Group, LLC, an institutional investment research firm established in 1981. In 1987, Steve initiated a small investment management operation that is driven...

IT WAS BARZINI ALL ALONG

Editor’s note: This was originally published in a newsletter by Ben Hunt and is reprinted here with permission.

“Tattaglia is a pimp. He never could have outfought Santino. But I didn’t know until this day that it was Barzini all along.”

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)

Ben Hunt

Ben Hunt is the Chief Investment Officer at Second Foundation, a venture that arose out of Epsilon Theory, which is a financial analysis website and newsletter that examines capital markets through the lenses of game theory and history. Prior to co-founding Second...

VIX ETN NOT RIGHT FOR INVESTORS

Editor’s note: This was originally published as a Chart in Focus by McClellan Financial Publications on January 02, 2014 and is reprinted here with permission.

In the Dec. 16, 2013 issue of Forbes magazine, the editors offer their list of “365 Ways 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)

Tom McClellan

Tom McClellan has been editor of The McClellan Market Report since 1995, and is ranked as the #2 Stock Market Timer for 2016 according to Timer Digest.  He is the son of Sherman and Marian McClellan, who in 1969 created the McClellan...

ASSESSMENT OF INSIDER TRADING INFORMATION FOR INVESTMENT STRATEGIES

Editor’s note: This was previously published at The Augmented Trader and is reprinted here with permission. Dr. Balch will be a presenter at the MTA Annual Symposium in April. This paper demonstrates how he applies insider transaction trader and offers a detailed look at is thought process.

Overview

Lucena Research has evaluated the InsiderInsights Company Ratings database as an information source for an event-based...

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)

Scott Strong
Tucker Balch, Ph.D.

Tucker Balch, Ph.D. is a former F-15 pilot, professor at Georgia Tech, and co-founder and CTO of Lucena Research, an investment software startup. His research focuses on topics that range from understanding social animal behavior to the challenges of applying Machine Learning...

INTERVIEW WITH BRUCE KAMICH, CMT

How would you describe your job?

My job and current passion is teaching technical analysis (TA). I am an adjunct professor of finance at Baruch College in New York City. Every semester I work hard to teach a lifetime skill (TA) to eighty, 20-30 year old students from various backgrounds and experiences.

For the past fifteen years I have been combining old school and...

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)

Bruce Kamich, CMT

Bruce M. Kamich, who has held the Chartered Market Technician (CMT) designation since 1992, is a technical analyst for TheStreet.com and a two-time past president of the CMT Association. He serves as an advisor for the Technical Analysis Educational Foundation, of which...

Amber Hestla-Barnhart

Bio coming soon.

NY FED MODELS FORECASTING EXCESS RETURNS THROUGH 2018 ENCOUNTER THE YEAR OF THE HORSE, VALUATION MEAN REVERSIONS, & GEORGE LINDSAY’S THREE PEAKS AND A DOMED HOUSE

The NY Federal Reserve has an equity research department. Their research department determined in 2013 that “stocks are cheap” and investors should enjoy “excess high returns” in an abnormally low or negative real interest rate environment for the next five years through 2018. Before reviewing potential mean reversions, implications from the Year of the Horse, & George Lindsay’s bearish Three Peaks and Domed House...

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)

John Bougearel, CMT

John Bougearel, CMT, is a founder and principal of Structural Logic Inc, a Commodity Trading Advisor.  Structural Logic incorporated in August 2000 as a financial newsletter and later became a CTA, offering managed futures accounts to clients in 2012. John’s career in...