Trading Between the Lines - Pattern Recognition and Visualization of Markets

Praise for Trading Between the Lines§"It's refreshing to see an investment book focused on answering the key questions: What's going on in the market? And where might prices be going next? In Trading Between the Lines, Elaine Knuth considers the very essence of market dynamics,psychology, and the price patterns associated with a range of conditions and situations. These thoughts are then developed effectively in her book into a colorful lexicon of market environments and potentially powerful trading strategies." -Adam Sorab, Head of Technical Research, CQS LLP, UK§"Trading Between the Lines offers readers important insights about the manner in which market patterns reflect differences in perception and human emotion across the trading population. Elaine Knuth makes wonderful use of intuition to communicatethe core ideas underlying technical analysis."-Hersh Shefrin, Mario Belotti Professor of Finance, Santa Clara University§"Elaine explains bubbles, reversals, crashes, and how to take advantage of them with subtle common sense. She reminds us that prices and markets are a matter of human relationships, and not farfetched mathematics."-Valérie Gastaldy, Commercial Director, DayByDay, Paris, France§"As a market practitioner for more than 30 years, I have evolved from seeking anindicator to forecast the market to understanding that forecasting is best left tothe analysts, and that it is better to make money than to be right. My compliments to Elaine; she has put her money on the line and learned from the hardest teacherin the world-the market. She shares many of these lessons in this book. I particularly liked the idea of creating market scenarios. Once a trader creates a scenario and understands what to do under various conditions, then he or she is never taken by surprise."-James Stewart, Vice President and Director, Capital Markets Division,RaiffeisenBank S Insights into a pattern-based method of trading that can increase the likelihood of profitable outcomes§While most books on chart patterns, or pattern recognition, offer detailed discussion and analysis of one type of pattern, the fact is that a single pattern may not be very helpful for trading, since it often does not give a complete picture of the market.§What sets Trading Between the Lines apart from other books in this area is author Elaine Knuth's identification of sets of patterns that give a complete analysis of the market. In it, she identifies more complex chart patterns, often several patterns combined over multiple time frames, and skillfully examines these sets of patterns called "constellations" in relation to one another. These constellations turn sets of individual patterns into a more manageable set of patterns, where the relationship between them can lead to tactical trading opportunities.§Shows how to apply complex patterns to specific trades and identify opportunities as well entry and exit points§Markets covered include commodities, equities, and indexes§Presents an effective trading approach based on real market cycles-as opposed to computer simulations-that are found in active markets§Moving beyond the simple identification of basic patterns to identifying pattern constellations, this reliable resource will give you a better view of what is really going on in the market and help you profit from the opportunities you uncover. Financial markets, whether you're talking about equities or commodities, are an ordered system of exchange, where participants are driven by individual responses to information. Within this arena, price, and the patterns emerging from a series of prices, give us instruction-they are our guide.§Nobody understands this better than Elaine Knuth-Principal Partner of Davenport Advisors, LLC-and now, with Trading Between the Lines, she shares her extensive insights on the integral role price and pattern play in successfully analyzing, and trading, today's markets.§Unlike other books in this field, which focus on a seriesof single patterns in isolation, this reliable guide details a series of more complex patterns-often several patterns combined over multiple time frames-and skillfully examines these sets of patterns called "constellations" in relation to one another. Along the way, it will help you discover how conceptualizing price behavior can allow you to recognize price pattern structures with predictive character and build effective trading tactics.§Engaging and informative, Trading Between the Lines puts this discipline in perspective as it:Examines specific reversal pattern constellations to the upside as well as the downside Covers continuation patterns and strategies-the Valley of Kings and the Place of Truth-that will allow a low-risk entry strategy for an existing and well-established trendExplores patterns-the Quiet Before the Storm and Lightning Bolt-that signal unexpected movesBrings together many of the pattern constellations and concepts into a universal pattern set called Adam and EveAddresses the issues of risk and trade managementas they pertain to trading pattern recognition methods§When making a trade, you're speculating on a future change in condition. With the pattern recognition and visualization methods found in Trading Between the Lines, you'll learn how to create strategies that can fit your risk appetite and exploit changes, or future price events, in many markets.