Weiss - Relationship investing: stock market therapy for your money

This book is intended to offer only general information with respect to the subject matter covered. Please consult with your financial advisor, accountant, or other competent financial professional if specific expert assistance is required. This book is sold with the understanding that the publisher and author are not engaged in rendering legal, tax, or other professional services. While every attempt is made to provide accurate information, the author and publisher cannot be held accountable for errors or omissions and make no warranty, express or implied, regarding it and shall not be liable for any losses, damages, costs or expenses relating to its adequacy, accuracy, truth, completeness, timeliness or use. Past performance of any security discussed or mentioned in this document is not an indication of future performance. Under no circumstance is the information contained within this document to be used or considered as an offer to buy or sell or a solicitation of an offer to buy or sell any particular security.

Copyright 2017 by Jeffrey S. Weiss

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Library of Congress Cataloging-in-Publication Data is available on file.

Cover design by Rain Saukas

Print ISBN: 978-1-5107-1013-9

Ebook ISBN: 978-1-5107-1015-3

Printed in the United States of America

Contents

Acknowledgments

I d like to express my sincerest thanks and gratitude to the thousands of brokers across the country who have believed in and followed my market work (in some cases for decades) and supported me so vociferously over the years in my capacity as their technical analyst. I dont know if I could have survived in this business so long without that support! My answers to your seemingly countless number of stock and market questions were always, and will continue to be for anyone seeking them, based on what I would do in that very same situation with my own money. I have never veered from that principle, nor will I ever.

Im also grateful for the opportunity to appear in the media, starting with the Financial News Network days where I met Ron Insana and Robert Metz. The opportunities Ive had to bring my motivational brand of stock market analysis to a television and radio audience in the decades since has been more than I could have ever imagined. Thanks to the many media bookers, producers, camera folks, and anchors who helped make that possible. My hats also off to the makeup artists who had their work cut out for them trying to make my face television bearable. I dont know how you did it. In fact, I think Im responsible for the lions share of any of your overtime pay in that regard! I also want to thank Frank Fochetta for introducing me to the good folks at Skyhorse Publishing.

Id especially like to thank legendary technical analyst Newton Zinder for hiring me at E. F. Hutton & Company in June 1982, giving me the opportunity to pursue my professional dream of working as a technical analyst. Hes as market savvy and humble as they come, and Ill never be able to thank him sufficiently.

As for my dad, who passed away in 2003, I hope that all dads are as wise and supportive as he was in helping me pursue my passionnever leaning on me to go into his line of business and chatting with me regularly about my interests and encouraging me in their pursuit. Like so many of you whove lost your dads, we will sorely miss their guidance but can still follow their sage advice and pass it on. Special thanks and hugs to my mom Jean, who stayed up late many a night to type my stock market letter for bicycle delivery to my 17 clients at $3 per subscription back in the 1970s. And to my wife Carrie, the very best that humanity has to offer.

Lastly and sadly, I also want to dedicate this book to my friends, former coworkers, neighbors, and all the other fine folks who perished in the September 11, 2001 attack on our nation. I will do my best to serve as a good and moral reflection on our business in your collective memories. May you be blessed.

Introduction

Before We Begin

T he only guarantees in the business of investing in the stock market are hard work and losses. The unforgiving nature of the stock market requires both flexibility and the realization that, while many investors have indeed benefited handsomely from investing in this arena, ruinous market declines have upended the lives of others, and not just in the financial sense. Therefore, capital preservation considerations should always precede capital appreciation considerations when it comes to investing your hard-earned capital. Concentrate on what you stand to lose if youre wrong, not on your potential gain if youre correct. After all, its not the latter outcome that will hurt you. Im also reminded of a favorite saying of a market mentor of mine back in the 1970s, who remarked that the stock market teaches you humility. Carry these essential thoughts with you into the investment arena each and every day. And remember that not everyone is suited to invest in the stock market. With this in mind, Id like to present a uniquely different way in which to relate to the markets mannerisms and movementsa nontechnical look at technical analysis (the discipline I use), you might say. I hope you like it. Maybe youll even be motivated to read some books on technical analysis or take a class or two for starters. Ultimately, however, the choice of how and whether to invest your hard-earned capital is yours.

Chapter 1

My StoryLessons Learned

A t times I think I must have been born on the floor of the New York Stock Exchange. Having been introduced to the stock market at the ripe old age of twelve, I never imagined being involved in any other business. I guess I was destined to pursue a path toward the stock market arena. My friend of fifty-four years, Ken, still reminds me of the time I questioned our sixth-grade math teacher, Mr. Toth, in front of the entire class concerning a statement he made while lecturing to us about the stock market. While he doesnt recall the specific point I took issue with, Ken remembers me being correct. Time does fly. Mr. Toth, a young man back then, is now retired.

I can still remember my dad taking me into the local Shearson, Hammill & Co. brokerage office in Paramus, New Jersey, during the late 1960s. I was numbed by the sight of the ever-changing green stock quotes emblazoned on the black background of the tickers in the brokerage office. The top ticker was confined to listings on the New York Stock Exchange (otherwise known as the Big-Board), while the bottom tape housed American Stock Exchange (also known as the AMEX) listings. I loved watching the different numbers appearing on the quote machine as my dad punched in his stock symbols. The device used at the time was a Bunker Ramo machine, on which you could retrieve a stocks current quote, bid and asked prices, and volume on a single screen measuring around four inches square. Who could have imagined the giant multiscreen and brightly colored displays now in common use, with monitors stacked two and three high and simultaneously housing hundreds upon hundreds of constantly flashing financial quotes with charts galore? Believe it or not, back when I started you could only request one quote at a time. It seems primitive now but looked totally high-tech back then.