Time-Tested Strategies That Work
A Master Systems and Pattern Tester
by Leslie N. Masonson
Chris Manning has spent thousands of hours poring over published systems, models, and charting patterns. Now he is a widely recognized systems expert who regularly appears on the CNBC and the Bloomberg Channel cable networks, and speaks frequently at international investment seminars. Here Leslie Masonson, who featured an interview with Manning in his book Day Trading On The Edge, reveals this expert trader's approach.
It wasn't until Chris Manning, who was a strategic consultant for a Big Five accounting firm, attended a popular investment seminar that the idea of trading stocks for a living even occurred to him. Intrigued by the profit potential in trading, inspired by the course and confident that he could rake in the profits by following the principles outlined in the seminar, he abruptly quit his job to become a full-time trader.
But he found out to his dismay that it wasn't that easy. His first few months of trading were very painful, as well as costly, as he watched his entire trading stake go up in smoke. He found out too late that the course had not taught him when to buy and when to sell using tested, proven charting strategies.
Undaunted, this led him to model other successful traders and find out specifically what they were doing so he could duplicate their efforts. Manning also researched all the published and unpublished patterns he could find for timing stocks using systems and indicators. Then he applied his New York native skepticism (as in, "Don't believe it unless you see it") to the project. Being a logical, systematic thinker and using his consulting skills, Manning set out on a three-year journey to backtest numerous trading systems and indicators to determine which ones worked consistently. Combining testing and trading, he was able to come up with a handful of time-tested strategies that worked. This took time, but Manning finally achieved his goal. (See sidebar, "Chris Manning's Trading Rules.")
SIDEBAR FIGURE 1: A TRIPLE TOP. Don't be tempted to short immediately when support is broken.
...Continued in the November 2002 issue of Technical Analysis of STOCKS & COMMODITIES
Excerpted from an article originally published in the November 2002 issue of Technical Analysis of STOCKS & COMMODITIES magazine. All rights reserved. © Copyright 2002, Technical Analysis, Inc.
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