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Mastering Hurst Cycle AnalysisA modern treatment of Hurst's original system of financial market analysisby Christopher Grafton
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Jacket text
One of the best classical methods of technical analysis brought up to date
This book offers a modern treatment of Hurst's original system of market cycle analysis. It will teach you how to get to the point where you can isolate cycles in any freely-traded financial instrument and make an assessment of their likely future course.
Although Hurst's methodology can seem outwardly complex, the logic underpinning it is straightforward. With practice the skill needed to conduct a full cycle analysis quickly and effectively will become second nature. The rewards for becoming adept are high conviction trades, tight risk management and mastery of a largely non-correlated system of analysis.
In this extensive step-by-step guide you will find a full description of the principal tools and techniques taught by Hurst as well as over 120 colour charts, together with tables and diagrams. The Updata and TradeStation code for all of the indicators shown is also included.
Contents
About the author
Acknowledgments and thanks
Introduction
1. The Properties Of Cycles
Introduction
Basic Quantities
Visualising Period and Amplitude
How Cycles Combine
Properties of Market Cycles
Conclusion
2. Basic Tools I: Valid Trendlines
Trend and Trendlines
The Concept of Trendlines
Trend Direction
Trend Strength
The Real Nature of Trend
The Valid Trendline (VTL)
The Key Role Played by VTLs
Conclusion
3. Basic Tools II: Displaced Cycles - The FLD
Introduction
Properties of the FLD
Plotting the FLD
Applying FLDs
FLD Combinations
Conclusion
4. Isolating Market Cycles I
Introduction
Cycle Envelopes
Phasing Analysis Set Up
Conducting a Phasing Analysis
Conclusion
5. Isolating Cycles II
Introduction
Spectral Analysis
Phasing Analysis - Daily Chart
Conclusion
6. Selection, Set Up And Entry
Introduction
Creating a Shortlist
Scanning Charts
Entering the Trade
Short Selling
Conclusion
7. Managing Open Positions
Introduction
Case Study - JP Morgan Chase 2002/2003
Conclusion
8. RSI And Elliott Wave
Introduction
RSI and Elliott Wave - The Basics
Case Study I: Gold, November 2008
Case Study II: Euro/USD, January 2010
Conclusion
Conclusion
Appendices
Appendix 1: Elliott Wave Patterns
Appendix 2: FLD Code
Appendix 3: Inverse Moving Average Code
Appendix 4: Cycle Envelope Code
Appendix 5: Diamonds Grid and Numbers
Appendix 6: Final Diamond Placement Code
Appendix 7: Discrete Fourier Transform Code
Appendix 8: Volatility Index code
Recommended further reading
The Sentient Trader
Index
About the author
| Christopher Grafton is currently Director, Principal Analyst and Systems Developer at Vectisma Ltd., an independent market analysis firm focusing on Japanese equities with a global macro overlay, based in England. Previously, he has held positions on the sell side at several investment banks in London and Tokyo and also worked as an analyst and trader for a London-based hedge fund specialising in Japanese equities.
Christopher speaks fluent Japanese, is a member of the Market Technicians Association, is a successful systems designer, programmer and trader, and holds the Chartered Market Technician designation. |
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More about Christopher Grafton
Reviews
"This book is highly-recommended for any market analyst or trader who wishes to add cycles to their analytical toolbox. This is a clear and concise introduction."
- Bill Sarubbi, Fund Manager, Cycles Research Investments LLC, Vienna
"Cycles are one of the most underutilised, and yet most rewarding, sources of information available to an analyst or investor. If it is possible to anticipate a reversal, and track it in real time, then eager investors should want to know about it. Until relatively recently, cycles have not been properly understood, so there has been a dearth of practical knowledge. This gap is now being filled by dedicated researchers such as Chris Grafton. His book brings together the ideas of one of the pioneers of cycle analysis - the engineer, J.M. Hurst - and presents them in an easily understandable and very useable form. Once mastered, the techniques explored in the book should be a source of significantly enhanced market understanding and very profitable investment."
- Tony Plummer, Author, Forecasting Financial Markets, Director, Helmsman Economics Ltd
"I really like this book. It takes the excellent original idea of Hurst and brings it right up-to-date in the modern computer era. It explains cycles and harmonics and shows how to construct Valid Trend Lines and Lines of Future Demarcation. It does not pretend that this subject is easy, but does explain it with very clear charts and writing. The work shows the relationship to Elliott waves and RSI oscillations. There are some clear worked examples and ideas of how to put on and manage a trade. Most investors will find it a useful addition to their knowledge. Well done Chris Grafton."
- Robin Griffiths, Cazenove Capital Management
"Through clear, straightforward explanations of the tools and up-to-date market illustrations, Grafton makes Hurst cycle analysis accessible to today's trader. Readers gain not only a thorough understanding of cycles but also the skills to begin implementing cyclic analysis immediately."
- Julie Dahlquist, Ph.D., CMT, Editor of the Journal of Technical Analysis and coauthor of Technical Analysis: The Complete Resource for Financial Market Technicians
"JM Hurst's Cyclic Principles are perhaps the most powerful yet misunderstood concepts about the workings of financial markets in the history of financial trading. Published in the 1970s, Hurst's work has survived into the 21st century because it is so powerful and effective, but the application of his principles and the practice of his trading methodology have been shrouded in a cloak of arcane mystery. Christopher Grafton has done a great service to the 21st century trader by thoroughly presenting Hurst's work in a format that replaces the pencil, eraser and chart pad with a computer. Armed with the tools that Grafton includes in the book (and an understanding of how to apply them) the reader will be well placed to start honing their analytical skills and putting this powerful theory to profitable use."
- David Hickson, creator of Sentient Trader - Hurst Trading System (www.sentienttrader.com)
In the news
"All in all, I believe that anyone interested in technical analysis will find it very useful and excellent value for money, as they begin to gain sufficient knowledge to confidently use Hurst Cycle Analysis methods in their technical analysis of the markets."
- Traders Day Trading
11th February 2012
"Grafton's clear prose explains Hurst's ideas and then goes further with exercises of practical application. As the author says, applying the method is challenging. He shows times when questions arise and gives examples of how to answer them using the Hurst cycles template as a basis. The Hurst template uses cycles of specific lengths, perhaps a questionable proposition; but the procedure would work with cycles of any lengths. My good friend Jim Tillman, now retired, was a master of the cyclic approach, proving that in the right hands cycle analysis can be a great guide to future market action. If you want to learn how to apply market cycles, you would do well to begin with this book... a worthwhile addition to any market student's library."
- Robert Prechter, The Elliot Wave Theorist
20th January 2012
"Grafton's book is one that belongs on any technical trader's shelf."
- Share Crazy
9th January 2012
"This book takes cycle analysis into the modern trading day, updating Hurst’s classic work from the 1960s and 1970s with technology available today. Grafton has done a commendable job both in preserving market history and providing a useful guide for traders."
- MTA Technically Speaking Newsletter
5th January 2012
Book Review - Jan/Feb 2012
- Your Trading Edge
5th January 2012
Christopher Grafton 'Mastering Hurst Cycle Analysis' Interview
- Trading Diary
4th December 2011
Contact the author
If you would like to get in touch with our author to arrange an interview, article, book signing, speaking arrangement, etc., please contact Rebecca in our PR department:
Tel: +44 (0)1730 233885
Email: pr@harriman-house.com
Please note that we do not give out our authors' personal contact details and will discuss your enquiry with them.
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