Dancing with the Trend

Greg Morris
About the author: has been a technical market analyst for over 40 years and is the author of several popular financial analysis books including Candlestick Charting Explained, Investing with the Trend and The Complete Guide to Market Breadth Indicators. Before retiring, he served as the Chief Technical Analyst and Chairman of the Investment Committee for a technical-based money management company with over $5.5 billion under management. Greg has appeared on CNBC, Fox Business, and Bloomberg Television and has also spoken at numerous financial conferences around the world.

Latest Posts

Dancing with the Trend

Why Technical Analysis?

by Greg Morris

Technical analysis offers an unbiased truth about the markets.  I am writing this article because I have a large number of new readers.  I addressed this subject a few years ago. If one is going to follow and utilize a particular discipline, hopefully they have done a thorough investigation as to the benefits and pitfalls of that discipline.  I’ll share a short story from the mid-1970s, a period of my life when I was a Navy fighter pilot, and of course, knew everything and was immortal.  I had a few thousand dollars that I wanted to invest.  I honestly can’t Read More 

Dancing with the Trend

What We Know That Isn't So - part 2

by Greg Morris

Investment-Related “Believable” Misinformation Makes Successful Investing Hard Work This article is a continuation of the previous article.  You should read the preliminary information provided in that article first. Diversification protects against losses.  Harry Markowitz won a Nobel Prize in 1990 for his ground-breaking research on diversification (modern portfolio theory) in 1952.  The simple explanation of this theory is that by diversifying across a wide range of asset classes, one will not be devastated by a significant decline in any particular asset Read More 

Dancing with the Trend

What We Know That Isn't So

by Greg Morris

Investment-Related “Believable” Misinformation Makes Successful Investing Hard Work Exceptional discipline and objectivity will keep you from falling victim to short-term emotion and chasing something new, even though you know your long-term methods are sound.  The uncertainty of the market requires a methodology that allows you to participate in most of the good times and avoid most of the bad times.  The only thing worse than being wrong, is staying wrong.  So why do we want to believe information that does not hold up under scrutiny? Being Read More 

Dancing with the Trend

Discipline, Discipline, Discipline!

by Greg Morris

Discipline is the Key!  You should look up the definition for both the noun and the verb. Over the years I've stressed the importance of having discipline in any investment strategy, and that is certainly still the case. A couple of years ago, when the market was in an ongoing up move, I had to take each small correction seriously because I never knew when it would turn out to be more than just a simple pullback or correction. I was whipsawed at times, selling my positions during weakness and then having to buy back in when the market turned up again, often at a higher price. While Read More 

Dancing with the Trend

Things That Can Screw Up Your Investing!

by Greg Morris

I’ve written before about heuristics and cognitive biases in my Know Thyself series from a couple of years ago.  Here I put together a list of them with short definitions and explanations.  That space between your ears is generally a horrible investment decision maker. Anchoring Bias – Too often investors base decisions on the first piece of information they hear or see.  With the stock market, this is usually the price at which they bought a stock.  It is from that price most future decisions about what to do with it are based.  This helps explain why I prefer Read More 

Dancing with the Trend

Friends Don't Let Friends Buy and Hold

by Greg Morris

The timing of this article is appropriate. Part of this was written by Tim Chapman who was a founder of PMFM, the company I worked with and later became Stadion.  I liked its message so am updating it with this article.  I remember back when I was managing money, I had an interesting conversation with a longtime client. He was appreciative that I was able to protect his retirement account and produce a positive return over the past three years (2007-2009 bear), but he almost felt guilty mentioning it to friends who've lost 50% or more of their money. He had a great line when he Read More 

Dancing with the Trend

Junk Science; Junk Analysis!

by Greg Morris

I don’t think I have offended anyone in quite a while and feel I’m not doing my job if I don't try to periodically; so here goes! Often a simple mathematical series of numbers can sometimes get misinterpreted (promoted) to be something magical.  My personal favorite sequence is 6, 28, 496, 2520, 8128, and 24601.  I’ll explain them at the end of this article.  Personally, I see no value in the actual numbers that make up the Fibonacci series; a series developed by an Italian mathematician (Fibonacci) in the thirteenth century to help understand the propagation of Read More 

Dancing with the Trend

Volatility and The World's Greatest Investor

by Greg Morris

I've written before about the cost of volatility, both financially and emotionally, and in light of the volatility we saw in 2018, now is a good time to revisit that issue (while it is not an issue).  In 2018, after many sizable down moves, then prices bounced up and then the spin from the investment world was that everything was okay. But let's look at the real world for a moment.  This is part of two pieces I wrote many years ago BS (Before Stockcharts.com) and is somewhat appropriate for today. First of all, consider the market mavens and Read More 

Dancing with the Trend

RISK

by Greg Morris

Dictionary.com says:  Risk is the exposure to the chance of injury or loss; a hazard or dangerous chance.  American Heritage Dictionary says: Risk is the possibility of suffering harm or loss; danger.  These are just two of the many entries and these were just for the noun.  Risk in the world of investments and finance is more succinct.  Risk is the uncertainty of outcome; however, risk can be quantified whereas uncertainty cannot.  Many use risk as a quantitative measure and uncertainty for measuring the non-quantitative type.  This article will attempt Read More 

Dancing with the Trend

Relative Performance

by Greg Morris

First of all, you cannot retire on relative performance.  Relative performance is often a valuable tool, but is also a marketing concept dreamed up by financial pundits who rarely outperform the market.  Table A is a table of various asset classes and their relative performance since 2009, with the last 3 columns being the last 3 months.  Keep in mind that each column (year) is totally independent of the other columns, and the assets classes at the top performed better than those at the bottom of each column.  You do not know if they both lost money, both made money Read More 

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