Kase on Technical Analysis Workbook. Kase Cynthia А.

      Cynthia A. Kase

      Kase on Technical Analysis Workbook

      The Bloomberg Financial Series provides both core reference knowledge and actionable information for financial professionals. The books are written by experts familiar with the work flows, challenges, and demands of investment professionals who trade the markets, manage money, and analyze investments in their capacity of growing and protecting wealth, hedging risk, and generating revenue.

      Since 1996, Bloomberg Press has published books for financial professionals on investing, economics, and policy affecting investors. Titles are written by leading practitioners and authorities, and have been translated into more than 20 languages.

      For a list of available titles, please visit our Web site at www.wiley.com/go/bloombergpress.

KASE ON TECHNICAL ANALYSIS WORKBOOKTrading and ForecastingCynthia A. Kase, CMT, MFTA

      Cover Design: Wiley

      Cover Images: Abstract blue lines ©iStock.com/traffic_analyzer; Blue binary matrix ©iStock.com/David Marchal

      Copyright © 2015 by Cynthia A. Kase. All rights reserved.

      Published by John Wiley & Sons, Inc., Hoboken, New Jersey.

      Published simultaneously in Canada.

      NinjaTrader^® charts have been used with permission.

      Charts created using TradeStation have been used with permission. © TradeStation Technologies, Inc. 2001–2013. All rights reserved. No investment or trading advice, recommendations, or opinions are being given or intended.

      No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, [phone], fax [phone], or on the Web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, [phone], fax [phone], or online at http://www.wiley.com/go/permissions.

      Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. Neither the publisher nor author shall be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

      For general information on our other products and services or for technical support, please contact our Customer Care Department within the United States at [phone], outside the United States at [phone] or fax [phone].

      Wiley publishes in a variety of print and electronic formats and by print-on-demand. Some material included with standard print versions of this book may not be included in e-books or in print-on-demand. If this book refers to media such as a CD or DVD that is not included in the version you purchased, you may download this material at http://booksupport.wiley.com. For more information about Wiley products, visit www.wiley.com.

       Library of Congress Cataloging-in-Publication Data:

      Kase, Cynthia A.

      Kase on technical analysis workbook + video course: trading and forecasting / Cynthia A. Kase.

      pages cm. – (Bloomberg financial series)

      Other title: Kase on technical analysis workbook and video course

      ISBN 978-1-118-81897-8 (paper/video); ISBN 978-1-118-81898-5 (ePDF); ISBN 978-1-118-81892-3 (ePub)

      1. Technical analysis (Investment analysis) I. Title. II. Title: Kase on technical analysis workbook and video course.

      HG4529.K364 2015

      332.63′2042 – dc23

      2014040829

      To my dear husband, friend, and consigliere, Paul R. Pedota, who has had my back from the day we met.

      Foreword

      I met Cynthia more than 20 years ago when we were touring for Dow Jones-Telerate. We talked about the markets. She was full of contagious energy, very excited about trading and technical analysis, and had just developed her DevStop and started her new business. She still is just as enthusiastic. Since then she has developed a significant following in the energy markets, an ever-changing, volatile, and seemingly unpredictable commodity. Yet she has flourished where many have failed. I can only attribute that to her discipline and understanding of risk, two characteristics that I rank exceptionally high for those expecting to profit from trading.

      There seems to be a tendency among the senior industry professionals to “give back” at some point. That is, there is great personal satisfaction to share what you've learned with the next generation of traders. There may be some personal gain, but the overwhelming balance is the satisfaction. It is also a two-way process. When you teach, you learn from your students. It could simply be the questions they ask, which lead you to more clarity, but also the ideas embedded in the questions that lead you further on the path to discovery. It's the process of talking with people, rather than to people, and valuing what everyone says.

      Cynthia is one of those professionals who have learned and now shares. Her course is targeted to take the novice through the most practical elements of technical analysis, but also holds exceptional value for the advanced analyst. She covers the most popular and useful chart patterns, trends, and momentum indicators at the outset, but then develops considerable sophistication later on. She gives detailed explanations of her own indicators, risk controls, trading filters, multiple time frames, and puts them together into a trading program that can be personalized.

      For someone interested in developing their own special trading program, new concepts are vital. They stimulate your thought process and distinguish your trading from others'. Cynthia's course is filled with her own unique approach to many aspects of trading and her own interpretation of well-known methods. At the simplest level she advocates a double true range, that is, a range formed by two days of price movement rather than the standard 1-day range because it is more stable. I agree. It is a simple but important variation on volatility measurement.

      As she gets into the description of various oscillators, her KSDI (a divergence indicator) is shown to be much clearer and more reliable than the standard RSI, stochastic, or MACD versions. We both like divergence because it's proved to be one of those reliable trading signals, but Cynthia's version is much better and less ambiguous.

      Throughout the course, Cynthia adds extra value with small variations and explanations that she probably doesn't even recognize. When someone has a depth of understanding, they always manage to show it with added points and examples, and give more than you expect. Cynthia's examples are more practical than usual. We often see the “perfect” setup that justifies a particular pattern, but in reality they are not always so clear and do not always succeed. It is better to understand the reality than to be sold a shiny coin that is only plate.

      I encourage you to take a trip through technical analysis with Cynthia Kase. It is a more personal experience than reading a