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To: Dr. David Gleitman who wrote (65693)	9/16/1998 1:34:00 AM
From: Satish C. Shah	Read Replies (1) \| Respond to of 176387

This is the definitive book on technical analysis. "Technical Analysis of Stock Trends" by Edwards and Magee 7th edition In addition to this, if you want, go to altavista and search "technical analysis" you will get some real nice, informative short pieces. Good luck. regards, Satish

To: Dr. David Gleitman who wrote (65693)	9/16/1998 5:51:00 AM
From: JPR	Respond to of 176387

Hi: I recommend 2 books: Trading for a living by Dr. Alexander ELder Technical Analysis from A to Z by Steven B. Achelis Once you get an idea and grasp of the basic principles, let me know, I will recommend more advanced books on technical analysis. JPR

To: Dr. David Gleitman who wrote (65693)	9/16/1998 7:29:00 AM
From: LWolf	Respond to of 176387

David.... Easiest to understand on TA is Murphy's "The Visual Investor". Pring's "Technical Analysis Explained" is one of the TA bibles. Laura

To: Dr. David Gleitman who wrote (65693)	9/16/1998 8:08:00 AM
From: Lee	Read Replies (1) \| Respond to of 176387

David,..Re:Is there an "idiot's guide" to technical analysis that can be easily referenced reviewed? You might want to check this site. e-analytics.com Regards, Lee

To: Dr. David Gleitman who wrote (65693)	9/16/1998 9:54:00 AM
From: TigerPaw	Respond to of 176387

OT Technical Analysis Is there an "idiot's guide" to technical analysis ... askresearch.com This site has some brief pointers on how to read their charts. I personally check the money flow index on days with high volume but little price movement to guess future sentiment. I read an article in Discover about a great math professor who turned to investing. In essence he said that he can find predictive patterns but his own trading negates the effect - In other words by the time you hear of a successfull strategy it won't work anymore. TP

To: Dr. David Gleitman who wrote (65693)	9/16/1998 1:30:00 PM
From: Chuzzlewit	Read Replies (2) \| Respond to of 176387

David, I know you didn't direct your question to me, but let me give you one very compelling reason to avoid TA. By its very nature TA is a trading strategy -- short term. But the inherent inferiority of that approach is easy to demonstrate. Lets make the assumption that on a buy and hold basis over a period of five years you earn 20% per annum pre-tax. Assuming you are a US citizen subject to capital gains taxes that works out to an after-tax gain of just under 17.3% per annum. But a trading approach using the same 20% gain works out to a 14.4% annual gain (using the 28% short-term capital gains rate). In order to just equal the buy and hold rate the trader would have to earn a little over 24% pre-tax! That's a whopping 4% premium over the buy and holder. And that premium increases with both the length of time and the base rate. At 20% over 10 years the pre-tax return for buy and hold rises to 18.1%, so the comparable pre-tax required rate for traders increases to 25.1%! If the base rate went to 30% the trader would have to net nearly 37% pre tax (a 7% premium). All of this just to do as well as the buy and hold strategy. And this analysis neglects transaction fees. There are two reasons for the inferiority of a trading strategy. First, there is a tax differential (28% vs. 18%); second, traders must pay estimated taxes in the year in which the gains are made. In other words, a buy and holder in effect receives an interest-free non-recourse loan from the government. Now there is a second reason to avoid TA. It doesn't work. There's lots of empirical evidence to back this claim up. I think the best person to ask about all of that evidence is jimleon. The best layman's discussion of this stuff is found in a book I've been recommending everyone on this thread read -- Burton Malkiel's A Random Walk Down Wall Street. This book is virtually required reading in every MBA program in the country. The book is cheap (lists for around $19 in paperback), and is probably the best summary of serious stock market research I've seen. TTFN, CTC