Cyclic Analysis: A Dynamic Approach to Technical Analysis

The course, Cyclic Analysis: A Dynamic Approach to Technical Analysis itself is quite lengthy and will prove exceedingly valuable to those willing to devote the necessary time and effort to studying and mastering the principles of trading it teaches.

Introduction:

The advent of accurate and continuous equity price histories made possible the study of equity price movement as a function of time, independent of all other variables. Early studies of such data produced the conclusion that equity prices vary in a random, hence unpredictable, way. This conclusion has been replaced in the last decade as evidence mounts that equity price variation is ordered and quasi-predictable. The relationship between past and future prices is found to be complex and nonlinear. Current simplified models represent price movement as consisting of a linear combination of wave functions with specific and consistent interrelationships. This viewpoint has led to the development of the Wave Theory of Price Action.

From this Wave Theory, a body of practical application methods called Cyclic Analysis has been evolved which permits a fully integrated and wholly technical approach to the problem of trading and investing successfully in the stock and commodity markets. This approach features the following unique capabilities: prediction of price-reversal timing, prediction of the price at an anticipated reversal, estimation of the extent of the price move expected to follow a reversal, and evaluation of a transaction before entry in terms of risk and profit potential.

The Wave Theory of Price Action refutes the random-walk theory while adequately explaining why earlier studies resulted in the random-walk hypothesis. In addition, a theoretical basis for technical analysis of stock price movement is established, explaining both the successes and the failures of classical charting methods. Interactive relationships exist between fundamental factors and wave forcing func-tions such that the nature of both is preserved. A body of applications techniques known as Cyclic Analysis has evolved from Wave Theory. These techniques permit, for the first time, an integrated, self-contained, and completely technical approach to trading and investing in the stock and com-modity markets.

Contents:

• WAVE FUNCTIONS AND RELATIONSHIPS IN PRICE MOVEMENT
• THE INTERACTION BETWEEN WAVES AND FUNDAMENTAL EVENTS
• THE QUANTIFICATION OF TRENDS USING WAVE CONCEPTS
• PREDICTING PRICE REVERSAL TIMING
• PREDICTING THE EXTENT OF PRICE MOVES
• THE CASCADE PRINCIPLE
• RISK-LIMIT LOGIC
• A COMPLETE TRADING SYSTEM

Cyclic Analysis: A Dynamic Approach to Technical Analysis By J. M. Hurst PDF