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Technically Speaking, July 2008

Letter from the Editor

This month’s issue brings a great deal of news about our organization. To paraphrase Executive Director Tom Silveri’s excellent presentation at the May Symposium, “The state of the MTA is stronger than it has ever been.” The letters from Past President Phil Roth and newly inducted President Larry Berman describe some of the efforts which have led to our growth and strength over the past few years. We also have a detailed report about the MTA Educational Foundation course being taught at the University of Richmond. The Foundation has been actively promoting technical analysis within the academic community for a number  of years. For those interested in learning more about this organization, more details can be found at their web site,  www.mtaeducationalfoundation.org. A redesign of the site is currently underway, so check back often for the latest information. Three pages of Technically Speaking are devoted to the life and work of Ian Notley, who will be missed by all who had the pleasure of meeting him. Ian’s work is certainly important, and we are able to present a few

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What's Inside...

Turning Over the Reins: A Letter from Past President Phil Roth, CMT

by Phil Roth, CMT

On June 30 I completed my two-year term as President of the MTA. It was my third term as President, having served in 1989-1990 and in 1996- 1997. So I was President in the 1980’s, the 1990’s, and...

A Letter from Current President Larry Berman, CMT, CFA, CTA

by Larry M. Berman, CMT, CTA, CFA

Dear Members and Affiliates, I am very excited to be your new MTA President. In my previous executive roles as Vice-President of the MTA, President of the Canadian Society of Technical Analysts...

New MTA Chapter: Utah

by Edward Goettig, CMT

With the establishment of the Utah Chapter, those interested in the financial markets in our area can come together to discuss, debate, and learn secrets and insights to unlocking profitable trading....

Technical Analysis: An Academic Perspective, presented by Dr. Andrew W. Lo, Ph.D.

by Michael Carr, CMT & Andrew W. Lo, PhD

After being presented the MTA Recognition Award, Dr. Lo spoke briefly about the way academia perceives technical analysis. In his opinion, the field of technical analysis is gaining respect. He...

Trading With Relatives: Presented by Charles D. Kirkpatrick, II, CMT

by Michael Carr, CMT & Charles D. Kirkpatrick

Kirkpatrick spoke at the MTA Symposium after being recognized with the MTA Annual Service Award. He presented his stock selection technique as a complete methodology that could be implemented by any...

On the Campus

by Dr. John H. Earl, Jr, CFA, CLU, CHFC, ARM, CFP, CIC

In the fall semester of 1996, the Robins School of Business at the University of Richmond offered the first course in technical analysis at an accredited four-year university. (Similar to the debate...

MTA Profile: Ian Sydney Notley

This profile describes Ian Notley’s life and work in technical analysis. It was compiled by Clare White, CMT, Optionetics. com. Ian Sydney Notley — 2006 Annual Lifetime Achievement Award The work...

Reflections

by Ian McAvity

What follows is a long personal reflection on how Ian got to be in North America that I pulled together this morning in reflecting on the loss of an old friend for some younger friends who did not...

Notley’s Notes

Below are two examples of Ian Notley’s work in the field of technical...

Did You Happen To Really Know Ian Notley

by Karl Wagner, CMT

Did you happen to really know Ian Notley.. I did. I served with Ian Notley on the Boards of the Canadian Society of Technical Analysts and the International Federation of Technical Analysts. I think...

“What’s Hot” The MTA Library Announces...

Donations from Trader’s Library The MTA would like to thank Trader’s Library for its recent donations to the MTA Library. Trader’s Library has included the MTA on its mailing list of Review...

Turning Over the Reins: A Letter from Past President Phil Roth, CMT

Turning Over the Reins: A Letter from Past President Phil Roth, CMT

On June 30 I completed my two-year term as President of the MTA. It was my third term as President, having served in 1989-1990 and in 1996- 1997. So I was President in the 1980’s, the 1990’s, and the 2000’s. I plan to be available after 2010. I will remain on the Board in the position reserved for  the immediate ex-President; it will be the start of my 24th year on the Board or as a Committee Chair. But who’s counting?

My first official, non-presidential task is to congratulate the newly elected officers, Larry Berman as President, Dave Keller as Vice President, Craig Fullen as Treasurer, and Tim Snavely as Secretary. They have all served the MTA well in the past, most recently, Larry as Vice President, Dave as Regions Committee Chair, Craig

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Contributor(s)

Philip J. Roth, CMT

Phil Roth, CMT

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A Letter from Current President Larry Berman, CMT, CFA, CTA

Dear Members and Affiliates,

I am very excited to be your new MTA President. In my previous executive roles as Vice-President of the MTA, President of the Canadian Society of Technical Analysts (CSTA) and Vice-Chairman (Americas) of the International Federation of Technical Analysts (IFTA), I have had the unique opportunity to gain a solid understanding of the global technical community and how it coexists. Many countries around the world have professional technical societies and strive to provide a forum to educate and network their members, and there are many others that have struggled. The MTA has the following stated mission:

  1. Attract and retain a membership of professionals devoting their efforts to using and expanding the field of technical analysis and sharing their body of knowledge with their fellow members. The MTA has had great success in the past few years of providing support for our membership around the world and continue to

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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.

Contributor(s)

Larry M. Berman, CMT, CTA, CFA

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New MTA Chapter: Utah

New MTA Chapter: Utah

With the establishment of the Utah Chapter, those interested in the financial markets in our area can come together to discuss, debate, and learn secrets and insights to unlocking profitable trading. As a new chapter, we want to further progression and awareness in the field of technical analysis. Our goals include increasing the number of members and associates in this area as well as enthusiasm for technical analysis. By following the MTA mission statement of “Attract,  Establish, Educate,” we hope to meet these goals.

In order to establish a stronger presence and a dynamic field of technical analysis in Utah, our chapter will be building various partnerships with financial institutions, businesses and local universities. These partnerships are vital and will help us to increase our numbers, attract a diverse group of investors, and increase public awareness in the importance of technical analysis.

In my years of experience in the financial markets 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)

Edward Goettig, CMT

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Technical Analysis: An Academic Perspective, presented by Dr. Andrew W. Lo, Ph.D.

Technical Analysis: An Academic Perspective, presented by Dr. Andrew W. Lo, Ph.D.

After being presented the MTA Recognition Award, Dr. Lo spoke briefly about the way academia perceives technical analysis. In his opinion, the field of technical analysis is gaining respect. He recalled a time when he first started teaching and a colleague saw an issue of Technical Analysis of Stocks and Commodities magazine in his office. The colleague joked that Lo was reading financial pornography. More recent work, especially in the area of behavioral finance, has supported the theories of technical analysis.

Yet, academics are still not embracing technicians. Lo attributes this to cultural differences and presented a stark example. We are all familiar with analysis that reads similar to, “The presence of clearly identified support and resistance levels, coupled with a one-third retracement parameter when prices lie between them, suggest the presence of strong buying and selling opportunities in the near-term.” This is clearly technical analysis. Lo shows this to his

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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.

Contributor(s)

Michael Carr, CMT

Michael Carr, CMT

Andrew W. Lo, PhD

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Trading With Relatives: Presented by Charles D. Kirkpatrick, II, CMT

Trading With Relatives: Presented by Charles D. Kirkpatrick, II, CMT

Kirkpatrick spoke at the MTA Symposium after being recognized with the MTA Annual Service Award. He presented his stock selection technique as a complete methodology that could be implemented by any investor. Kirkpatrick had managed stocks since the early 1980s using a technique that combined RS with strong earnings growth. He was looking at methods to reduce risk when he read James O’Shaughnessy’s book, What Works on Wall Street. Combining that work with his own, Kirkpatrick came up with a simple screen to identify stocks with the potential for future gains, which is summarize in Table 1. This technique was recognized with the Dow Award in 2001. The complete paper can be downloaded from the MTA web site

Kirkpatrick’s Stock Selection CriteriaTable 1: Stocks meeting all of these tests are bought.

Kirkpatrick immediately implemented

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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.

Contributor(s)

Michael Carr, CMT

Michael Carr, CMT

Charles D. Kirkpatrick

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On the Campus

On the Campus

In the fall semester of 1996, the Robins School of Business at the University of Richmond offered the first course in technical analysis at an accredited four-year university. (Similar to the debate between Plymouth, MA and Jamestown, VA where the first Europeans landed in America, there is the same debate over whether the first technical analysis course was at Golden Gate University or Richmond). The course was the result of several years of negotiations between the Finance Department and Mike Epstein, head of the Market Technicians Association Educational Foundation (MTAEF). Mike had long been an advocate of incorporating the study of technical analysis within the finance curriculum of business schools.

Richard (Dick) Dickson, a technical analyst at Scott and String fellow in Richmond, organized and taught the first course. Dick brought in outside speakers to cover the specialized topic areas. Thirteen students were enrolled in the first class. One of the

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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.

Contributor(s)

Dr. John H. Earl, Jr, CFA, CLU, CHFC, ARM, CFP, CIC

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MTA Profile: Ian Sydney Notley

MTA Profile: Ian Sydney Notley

This profile describes Ian Notley’s life and work in technical analysis. It was compiled by Clare White, CMT, Optionetics. com.

Ian Sydney Notley — 2006 Annual Lifetime Achievement Award

The work of Ian S. Notley is probably best known through publications from his highly regarded research company, Yelton Fiscal Inc. Mr. Notley provided market and sector analysis to financial institutions using a disciplined top-down approach studied with rotation and relative performance studies. He was an active member of both the International Federation of Technical Analysts (IFTA) and the Market Technician’s Association (MTA).

In addition to being described as “a technician’s technician” when nominated, the most common theme encountered from those who knew the man is Mentor.

Technical Analysis Background

Ian Notley championed technical analysis of the financial markets in a career spanning 40 years. His specialty was long-term studies of secular and cyclical movements and their impact on money management style, and in particular, investment

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Reflections

Reflections

What follows is a long personal reflection on how Ian got to be in North America that I pulled together this morning in reflecting on the loss of an old friend for some younger friends who did not get to know him very well.

Ian Notley – some lesser known background to a 35 year friendship.

In 1973, I was writing Deliberations, the newsletter, for the institutional boutique, Draper Dobie & Co, in Toronto, where we had the first privately owned computer system dedicated to streaming stock exchange data. The Chairman of the firm, David Knight was an avid chartist, and fully supportive of anything in pursuit of data that Tony Lash and his crew could generate from those machines. Those machines provided the original stock quotes that appeared on Canadian cable TV for Rogers.

It seems so simple now, but it was a Eureka moment back then to suggest that maybe prices

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Contributor(s)

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Notley’s Notes

Notley’s Notes

Below are two examples of Ian Notley’s work in the field of technical analysis.

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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Did You Happen To Really Know Ian Notley

Did You Happen To Really Know Ian Notley

Did you happen to really know Ian Notley..

I did. I served with Ian Notley on the Boards of the Canadian Society of Technical Analysts and the International Federation of Technical Analysts. I think that I did know him. He was a most stimulating personality and a marvelous lunching companion with his pleasant wit and marvelous recall of personal and world history. Ian has had 20 to 40 people as employees in his company over the years. Personally, I’ve never seen such employee loyalty in any company of any size in any industry. His employees absolutely venerated him. Their one goal was to serve Ian and to keep Ian happy.

For several years I worked with Ian on a Relative Strength-to-the-market project, But that’s not what I want to write about. I want to tell you about accompanying Ian several times when he made one of his regular presentations to the staffs

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“What’s Hot” The MTA Library Announces...

“What’s Hot” The MTA Library Announces...

Donations from Trader’s Library

The MTA would like to thank Trader’s Library for its recent donations to the MTA Library. Trader’s Library has included the MTA on its mailing list of Review Copies for all of their newly released books. We will be posting all new book donations from Trader’s Library here.

  • “Trading & Hedging with Agricultural Futures and Options” by James B. Bittman
  • “Make Money Trading” by Jean Folger & Lee Leibfarth
  • “Option Spreads Made Easy” by George Fontanills
  • “Breakthrough Strategies for Predicting Any Market” by Jeff Greenblatt
  • “Forex Simplified” by Marilyn Mc Donald
  • “Trend Forecasting with Intermarket Analysis” by Louis B. Mendelsohn
  • “Money-Making Candlestick Patterns” by Steve Palmquist
  • “How to Select Stocks Using Technical Analysis” by Martin J. Pring
  • “Option Trading Tactics” by Oliver L. Velez
  • “Power Trading” by Oliver L. Velez
  • “Swing Trading” by Oliver L. Velez
  • “Naked Puts” by Ernie Zerenner & Michael Chupka

The MTA would also like to thank David Aronson, Mike Carr and Lane Mendelsohn for their

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New Educational Content This Month

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