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| Neil A Costa |
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"The Contributions of the Market Masters"
One of the most valuable professional development activities that traders can undertake is to study the market masters of yesteryear. In doing so, they will gain an understanding of:
They will almost certainly come to realise that many modern technical analysis tools were used by the masters of yesteryear. Sure, many have a different name today, but many date back to at least the early 1900s.
W. D. Gann regularly quoted one key phrase in the Bible:
"The thing that hath been, it is that which shall be; and that which is done, is that which shall be done: and there is no new thing under the sun".
[Gann, W. D., The Tunnel Thru The Air, Lambert-Gann Publishing Company, 1927, page 76, quoting the Bible, Eccl. 1:9.]
In the case of market analysis, it is true that the more things change, the more things stay the same. We only have to study market manias of the past, such as the Tulip Mania of the 1630s, the South Sea Bubble of the 1700s, the 1929 stock market bubble, the Poseidon madness of the late 1960s, the stock market crash of 1987 and the Internet Boom of early 2000, to see how human nature does not change when people are members of crowds. Markets reflect the human emotions of greed and fear - greed being the dominant emotion when markets are accelerating at an unsustainable rate, and fear as a market crashes.
So-called 'modern' technical analysis uses approaches which include Dr Alexander Elder's 'Triple Screen Trading', which he outlines in his popular book Trading For a Living. The technique is very similar to the advice given to traders by W. D. Gann who suggested that traders should look at the big picture first. No doubt Gann and Elder thoroughly tested the technique and found it to be very effective - despite the fact that they undertook their research at the beginning and end of the 20th Century, respectively.
Gann also wrote that when a market moved in a narrow sideways range, and then broke above or below that range, the trader should trade in the direction of the breakout. Today we call a technical analysis indicator that measures this low volatility 'Bollinger Bands'.
W. D. Gann used a combination of bar and swing charts to analyse and trade markets. He based his entry and exit techniques on the action and reaction of the market itself. Many people using today's 'modern' technical indicators fail to realise that such indicators often give a delayed entry and exit signals compared with an entry or exit based on price action alone.
Today, in the 21st Century, candlestick charts continue to grow in popularity. These charts were first used some 300 years ago - long before bar charts.
As you undertake your trading and investment journey, you will gain an understanding of topics such as support and resistance, trend, market action and reaction, and waves and cycles in markets. You will also gain some invaluable insights into the discoveries of the market masters - traders, analysts and writers such as:
I encourage you to explore further the works of the market masters and how their works can make you a significantly better analyst and trader.
DISCLAIMER:
Every effort has been made to ensure that the content and conclusions presented in The New W. D. Gann Technical Review are complete and accurate.
No part of The New W. D. Gann Technical Review contains trading advice - stated or implied, nor is an invitation to trade. The directors and associates of Lambert-Gann Educators, Inc. are NOT licensed trading or investment advisors. Lambert-Gann Educators, Inc. is an organization designed to assist traders and investors to become more knowledgeable and independent.
The giving of advice is therefore contrary to the very objectives of Lambert-Gann Educators, Inc.
Traders requiring trading or investment advice should contact a licensed advisor.
Stockbrokers and futures brokers are licensed advisors.
Neither Lambert-Gann Educators, Inc., nor anyone else involved in the production of The New W. D. Gann Technical Review, will be liable for any liability, loss or damage directly or indirectly caused, or believed to be caused, by The New W. D. Gann Technical Review.
Traders, to be successful, must take full responsibility for their own actions.
With respect to trading results, past performance is not necessarily an indication of future performance.
By maintaining your subscription to The New W. D. Gann Technical Review, you acknowledge that you understand and accept the contents of this disclaimer.
Lambert-Gann Educators, Inc.
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