The Theory and Science of Technical Analysis - Grimes - Table of Contents

THE ART AND SCIENCE OF TECHNICAL ANALYSIS: MARKET STRUCTURE, PRICE ACTION, AND TRADING STRATEGIES Adam H. Grimes

http://adamhgrimes.com/ To be published by J. Wiley & Sons, First Quarter 2012

PART I: THE FOUNDATION OF TECHNICAL TRADING CHAPTER 1: THE T RADER’S EDGE Defining a Trading Edge The Random Walk Hypothesis Valid Trading Ideas Are Non-Random Finding and Developing Your Edge Studying Trading Ideas Manual Testing vs. Automated Systems The Two Forces: Toward a New Understanding of Price Action

CHAPTER 2: HOW TO R EAD A CHART General Principles of Charting Indicators Toward Building Intuition Price Action and Market Structure Charting by Hand

PART II: MARKET STRUCTURE CHAPTER 3: THE MARKET CYCLE AND THE FOUR TRADES Wyckoff’s Market Cycle The Four Trades Trend Continuation Trend Termination Support or Resistance Holding Support or Resistance Breaking Summary

CHAPTER 4: ON TRENDS The Fundamental Pattern Trend Structure A Deeper Look at Pullbacks: The Quintessential Trend Trading Pattern Trend Analysis Summary

CHAPTER 5: ON TRADING R ANGES Support and Resistance Trading Ranges as Functional Structures Summary

CHAPTER 6: INTERFACES BETWEEN TRENDS AND RANGES Breakout Trade: Trading Range to Trend Patterns Preceding Good Breakouts Characteristic Patterns at Good Breakouts Patterns Following Good Breakouts Patterns of Failed Breakouts Trend to Trading Range Trend to Opposite Trend (Trend Reversal) Trend to Same Trend (Failure of Trend Reversal) Summary

The Art and Science of Technical Analysis by Adam Grimes, 2012

Page 2

PART III: TRADING STRATEGIES CHAPTER 7: P RACTICAL TRADING TEMPLATES Failure Test Pullback, Buying Support or Shorting Resistance Pullback, Entering Lower Timeframe Breakout Trading Complex Pullbacks The “Anti” Breakouts, Entering in the Preceding Base Breakouts, Entering on First Pullback P ullback Following Failed Breakouts Summary

CHAPTER 8: TOOLS FOR CONFIRMATION The Moving Average—The Still Center Channels: Emotional Extremes Indicators: MACD Multiple Timeframe Analysis Relationships between Markets Volume

CHAPTER 9: TRADE MANAGEMENT Placing the Initial Stop Setting Price Targets Active Management Portfolio Considerations Practical Issues

CHAPTER 10: RISK MANAGEMENT Risk and Position Sizing Theoretical Perspectives on Risk Three Measures of Risk Misunderstood Risk Practical Risks in Trading Summary

CHAPTER 11: TRADE EXAMPLES Trend Continuation Trend Termination Trading Parabolic Climaxes The Anti Trading at Support and Resistance Summary

The Art and Science of Technical Analysis by Adam Grimes, 2012

Page 3

PART IV: THE INDIVIDUAL, SELF -DIRECTED TRADER CHAPTER 12: THE TRADER’S MIND Psychological Challenges of the Marketplace Evolutionary Adaptations Cognitive Biases The Random Reinforcement Problem Emotions: The Enemy Within Intuition Flow Practical Psychology Summary

CHAPTER 13: BECOMING A TRADER The Process Requirements Commit to the Process Record Keeping Journal P&L Records Statistical Analysis of Your Trading Results Quantifying Your Edge Standardizing for Risk Control Charts Summary

The Art and Science of Technical Analysis by Adam Grimes, 2012

Page 4

PART V: THEORY AND Q UANTITATIVE UANTITATIVE ANALYSIS CHAPTER 14: ACADEMIC THEORIES OF MARKET BEHAVIOR The Efficient Market Hypothesis The Random Walk Hypothesis What Does Not Constitute Disproof  Credible Challenges to the Theory Behavioral Perspectives Summary UANTITATIVE ANALYSIS OF MARKET DATA CHAPTER 15: TOOLS FOR Q UANTITATIVE Some Market Math Three Statistical Tools A Warning against Sloppy Statistics Summary

CHAPTER 16: CASE STUDIES Methodology The Test Universe Pythia™ Common Practice Technical Analysis Fibonacci Retracements Moving Averages The Opening Range Phenomenon Quantitative Evidence of the Two Forces Mean Reversion Range Expansion Conclusion

APPENDIX A: TRADING PRIMER APPENDIX B: STATISTICAL STUDIES APPENDIX C: SAMPLE TRADE DATA

The Art and Science of Technical Analysis by Adam Grimes, 2012

Page 5