Alongside Laszlo Birinyi's stories from his more than forty years of trading experience, the book provides guidance on critical trading and investment issues, including:
- What the market will likely do if Spyders are up one percent in pre-trading
- Whether to buy or sell when a stock reports better that expected earnings and trade up to $5 to $50
- The details behind group rotation and market cycles
- The seasonal factors in investing
- Indicators, explained: which are indicative and which are descriptive
- The importance of sentiment and how to track it
The book will include chapters and details on technical analysis, the failure of technical analysis efforts, the business of wall street, trading indicators, anecdotal data, and price gaps. The Website associated with the book will also feature data sourcing and video.
Table of Contents:
Acknowledgments xiii
Preface xv
Chapter 1: Technical Analysis: Fuhgeddaboudit 1
Indicators: Pick One, Any One 3
1990 Another Opportunity Missed 6
Notes 9
Chapter 2: The Failure of Technical Efforts 11
A Lack of Analysis . . . (Again) 13
The Advance/Decline Line: A Favorite Tool, but Why? 15
Volume? Another Important Indicator? Really? 20
Newsletters—Once Upon a Time . . . 23
Predicting Rain Doesn’t Count; Building Arks Does 25
Technical Analysis Fails a Rigorous Test 28
Notes 30
Chapter 3: Technicals: The Last Word 31
Topical Studies: An Introduction 33
Notes 36
Chapter 4: Wall Street: Games People Play 37
A Brokerage Firm Can’t Calculate Performance? 40
Mr. Prechter 42
Notes 47
Chapter 5: Money Flows: The Ultimate Indicator 49
Playing with Blocks 51
It is Not How Often; It is How Much 54
The SEC’s Study on the Information from Large Trades 58
Wall Street Week: The Record 63
Apple is a Buy at $3? 65
Mr. Market’s Voice 71
Notes 73
Chapter 6: Anecdotal Data 75
Magazines and Newspapers Are Databases in Disguise 80
Dow Theory in Real Time 84
Magazine Covers—Overrated 87
Note 87
Chapter 7: Always Cut the Cards 89
Strategists: More Marketing Than Markets 91
Stock Market Research: An Oxymoron 94
The Issue of CAPE: Cyclically Adjusted Price-Earnings Ratio 95
Strategists: One More Thing . . . 97
What Do Stocks Really Return? 100
A Successful Model Except for “Irrational” Investors 102
The Press Should Be in the Reporting, Not Forecasting, Business 106
Notes 112
Chapter 8: DOW: 19,792? 115
Citibank (the Company) versus Citi (the Stock) 118
World War I: The Market Swoons, Oops, Rallies 120
The Dow Trades above 1,000 123
Notes 126
Chapter 9: That’s Easy for You to Say! 129
BusinessWeek: 1998, 1999, and America Online 131
BEST: Real Time, Real Money, Real Results 134
Notes 136
Chapter 10: Playing the Game 137
Mr. Buffett Buys and Sells Silver 139
Bonds Can Go Down 143
Mr. Ellis: The Loser’s Game 146
Wall Street Week: We Were Lucky (for Eight Years) 148
Money Managers Don’t Get It? 149
Notes 154
Chapter 11: Have It Your Way 155
Weasel Words: Not Our Choice, but Know and Recognize 160
Chapter 12: The Market: Yesterday, Today, and Tomorrow? 163
Commissions Go Down; ERISA Changes the Rules 164
London’s Big Bang: A Failure There, a Good Idea Here? 169
The Public versus “All Others” 173
High-Frequency Traders Get Billions, Brokers Prosper, but Are You Benefiting? 178
The Demise of the Japanese Market Was Structural 186
Notes 188
Chapter 13: Get Ready, Get Set . . . 191
Tracking Sentiment, or, Keeping Score of the Players 195
Note 196
Chapter 14: Market Cycles and Rotation 197
How to Tell Whether We Are in the Eighth or Ninth Inning 201
Group Rotation Exists; It is Random but Worth Understanding 204
Small Stocks: On Average, Yes, but . . . 212
Growth versus Value: Advantage Growth, but . . . 214
Notes 216
Chapter 15: The Economy and the Federal Reserve Board 217
GDP and the Market, No Surprises Here 218
The Fed Tightens: It Hurts Only for a Little While 221
1994: A Little Perspective, if You Please 225
1995: Economists Predict Because They Are Asked, but Why? 226
Note 228
Chapter 16: Picking Stocks 229
Seeds: Ideas to Get You Started, Planting, and Harvesting Come Later 232
Sprained Wrists Eventually Heal (and Prosper) 233
Capitulation: Another Example of the Anecdotal Process 237
Trend Charts: Late In, Early Out but Profitable and Comfortable 239
Note 245
Chapter 17: The Trading Day 247
The Morning after a Big Day 250
What Do Futures Tell Us? 253
It’s 10:00 a.m.; Do You Know Where Your Stocks Are Going? 253
Chapter 18: “Mind the Gap” 265
After the Post‐Market Fall . . . or Rally 267
Gaps Provide Opportunities and Have Some Tendencies, but None Written in Stone 270
Gaps Squared 272
Old Rule: Large Gaps Have to Be Closed—New Rule: About 25 Percent 273
Chapter 19: You Must Remember This 277
It’s Smart to Be Bearish, but Not Necessarily Profitable 279
You Can Never Know Too Much about Too Many Things on Wall Street 281
Notes 284
Chapter 20: Wall Street Week and Other Adventures 285
Salomon Brothers: The Bar Was High, Even for the Chef 287
Notes 289
Appendix A E xpansions/Recessions and Bull/Bear Markets 291
Appendix B Cost of Timing the Market 303
Dow Jones Return 303
Appendix C H istory of Regulation 307
Glossary 311
About the Author 315
About the Companion Website 317
Index 319
