Quantum Trading E-Book

Fabio Oreste

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Serie: Wiley Trading Series
• Sprache: Englisch

Seitenzahl: 401

Veröffentlichungsjahr: 2011

Beschreibung

A cutting-edge guide to quantum trading Original and thought-provoking, Quantum Trading presents a compelling new way to look at technical analysis and will help you use the proven principles of modern physics to forecast financial markets. In it, author Fabio Oreste shows how both the theory of relativity and quantum physics is required to makes sense of price behavior and forecast intermediate and long-term tops and bottoms. He relates his work to that of legendary trader W.D. Gann and reveals how Gann's somewhat esoteric theories are consistent with his applications of Einstein's theory of relativity and quantum theory to price behavior. * Applies concepts from modern science to financial market forecasting * Shows how to generate support/resistance areas and identify potential market turning points * Addresses how non-linear approaches to trading can be used to both understand and forecast market prices While no trading approach is perfect, the techniques found within these pages have enabled the author to achieve a very attractive annual return since 2002. See what his insights can do for you.

Leseprobe

Contents

Cover

Series

Title Page

Copyright

Preface

Chapter 1: The Birth of Quantum Trading

A LESSON IN ELEMENTARY PHYSICS

P-SPACE: A QUANTUM TRADING TOOL

Chapter 2: How to Psychologically Prepare for Successful Trading

LIFE GOALS AND QUANTUM STRATEGIES

ARE PORSCHES AND SUPERMODELS EVERYTHING IN LIFE?

HOW DO YOU PLAY THE GAME OF LIFE?

BUILDING POWERFUL STRATEGIES IS THE KEY TO SUCCESS

CREATING MOMENTUM IN LIFE

CROSSING THE BRIDGE

Chapter 3: Quantum Trading 101

A GLIMPSE AT SOME TECHNICAL ANALYSIS PROBLEMS

MAKING MONEY WITH QUANTUM PRICE LINES

TRADING RULES OF THUMB

Chapter 4: Sun Spots, Geomagnetic Storms, and the Stock Market

DEFINING SUN SPOTS AND GEOMAGNETIC STORMS

PROPOSED TRADING STRATEGIES

Chapter 5: P-Space Structure and Quantum Trading Algorithms

CALCULATING A QPL

CALCULATING A QPL'S SUBHARMONICS

EXAMPLES OF POWERFUL QPLS AND QPLSHS

NOT ALL QPLS ARE ALIKE

TRADING WITH INTRADAY QPLS

Chapter 6: The Life and Contributions of W. D. Gann

AN UNCANNY MASTER OF TRADING INTERESTED IN ATOMS AND ELECTRONS

GANN'S THEORY OF STOCK MARKET CYCLES

Chapter 7: Chaos Theory and Gann Angles

HOW GANN ANGLES ORIGINATED

THE FALL OF THE STOCK EXCHANGE IN 2000

Chapter 8: Money Management Strategies

WHY SOME TRADERS HAVE BIG LOSSES

THE DANGERS OF THE “AVERAGE LOSS” STRATEGY

NOISE, HOT RUMORS, AND RECOMMENDATIONS TO BUY

Chapter 9: Entelechy

GENERAL PROPERTIES OF QUANTUM ENTELECHY

QPL ENTELECHY

ANGULAR ENTELECHY

MAPPING AND TRAPPING

Chapter 10: Forecasting Tops and Bottoms Using QPLs and Subharmonics

FORECASTING A TOP

FORECASTING A BOTTOM

QPLSH RULE FOR 180-DEGREE ANGLES AND 90-DEGREE ANGLES

Chapter 11: Time Algorithms in Quantum Trading

PECULIARITIES OF TIME ALGORITHMS

FORECASTING TOPS AND BOTTOMS WITH TAS

TIME ALGORITHMS’ GOLDEN RULES

Chapter 12: How to Use All the Trading Tools Together

Chapter 13: How to Use Options

OPTIONS DEFINED

CALLS AND PUTS: TWO SIDES OF THE OPTION UNIVERSE

STRIKE PRICES WITH RESPECT TO THE UNDERLYING PRICE

THE COMPONENTS OF AN OPTION PREMIUM

INTRINSIC VALUE AND TIME VALUE

THE GREEKS: FUNDAMENTAL PARAMETERS OF OPTIONS

Chapter 14: Options Strategies with Quantum Trading Tools

QPLSHS: A POWERFUL INDICATOR TO BUY AND SELL OPTIONS

VOLATILITY-BASED SPREADS

Chapter 15: A Toast to a New Achievement in Trading

Conclusion: Making Peace with Mr. Market

Acknowledgments

About the Author

Index

Founded in 1807, John Wiley & Sons is the oldest independent publishing company in the United States. With offices in North America, Europe, Australia, and Asia, Wiley is globally committed to developing and marketing print and electronic products and services for our customers’ professional and personal knowledge and understanding.

The Wiley Trading series features books by traders who have survived the market’s ever-changing temperament and have prospered—some by reinventing systems, others by getting back to basics. Whether a novice trader, professional, or somewhere in-between, these books will provide the advice and strategies needed to prosper today and well into the future.

For a list of available titles, visit our Web site at www.WileyFinance.com.

Copyright © 2011 by Fabio Oreste. All rights reserved.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey. Published simultaneously in Canada.

No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, [phone], fax [phone], or on the Web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, [phone], fax [phone], or online at http://www.wiley.com/go/permissions.

Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. Neither the publisher nor author shall be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

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Library of Congress Cataloging-in-Publication Data:

Oreste, Fabio, 1963– Quantum trading : using principles from W.D. Gann and modern physics to forecast the financial markets / Fabio Oreste. p. cm. — (Wiley trading series ; 409) Includes index. ISBN 978-0-470-43512-0 (cloth); ISBN 978-1-118-09352-8 (ebk); ISBN 978-1-118-09353-5 (ebk); ISBN 978-1-118-09354-2 (ebk) 1. Speculation. 2. Stocks. 3. Quantum theory. 4. Physics. I. Title. HG6041.O74 2011 332.64′5—dc22 2011007465

Preface

Ihave written this book for traders, both professionals and beginners, who would like to start a new adventure, a journey into the vast and unexplored land of Quantum Trading. It's a journey that could change your life forever.

This book could also be considered an exploration of phenomenology and quantum philosophy. Why philosophy and not science? Because the quantum viewpoint affects not only particle science but also contemporary psychology and the way we conceive of the relationship between observed objects and the observer. We will also examine how we think of and experience reality.

Great thinkers such as Max Planck, Carlos Castaneda's Don Juan, like Erwin Schrödinger, W. D. Gann, and Albert Einstein have more in common than you might suspect. This book aims to express rocket science concepts in layman's terms and apply them to your daily lives and trading; it's going to be a lot of fun. You will better understand how reality works and achieve amazing results in many areas of your life. Above all, you can make huge amounts of money using these concepts to trade the markets.

We will be applying these ideas to create a Quantum Trading system that provides a high percentage of winning trading signals. In the first few chapters, I describe my proprietary approach to financial trading based on Einstein's theory of relativity and quantum physics, and how to start a very profitable business with little capital, compared to other businesses.

You will be able to set up your own personal “trading firm” without formally incorporating a company. If you follow the rules in this book and always use stop-loss orders, then you will find yourself trading more successfully. Stop-loss orders prevent large, unexpected losses for each trade and allow for the possibility of only relatively small losses, according to your personal risk tolerance.

If you are an absolute beginner and don't know how to calculate the best stop-loss with respect to your trading capital, don't worry. It is explained in detail within later chapters.

This book is also written for professional traders who may have many years of experience, but are looking for something new in the enormous arsenal of technical analysis theories and tools. I have been successfully using the Quantum Trading approach to manage my client's accounts for years, and I believe that other professional traders can use this theory to improve their performance, too.

The techniques presented here are based on a new approach to financial trading that I have developed during the past 15 years, and they are quite different from the classical technical analysis trading tools, even if they share some common ground.

You can apply Quantum Trading techniques to different time frames, such as weekly, daily, 60-minute charts, or 5-minute charts.

This book is not about methods of technical analysis that you are used to seeing. I am not going to speak about moving averages, oscillators, or the hundreds of indicators you already know about. Perhaps you are searching for something different, a more precise instrument that can indicate when the next top or bottom price could form.

Rather, this book is about quantum prices, time levels, and how the theory of relativity and quantum mechanics concepts can practically affect your favorite stock, commodity, or currency price. It is also about trading models that provide precise indications on trend turning points and how to predict the most likely prices and times for the major and intermediate reversal points.

We start our journey by borrowing some ideas from the theory of relativity and its implications in modeling space. We continue by examining electron behavior in the quantum world. Finally, we compare this notion with some of W. D. Gann's 100-year-old concepts about the market that are still relevant today.

We continue our journey by exploring fascinating lands, learning how quantum laws, according to scientist such as A. Goswami, can also affect our daily life. We review how this quantum approach can help us in obtaining a more meaningful life, freedom, and financial independence, and dramatically improve our life and the ability to get what is really important to us.

At the end of this process, you are going to discover many interesting and safe ways to make money in the financial markets using unconventional yet powerful trading techniques such as Quantum Price Lines (QPLs) and Time Algorithms (TAs).

If you continually improve yourself and reach for a higher and higher level of knowledge and awareness, you will exponentially increase your personal power and improve your energy level. You will experience a quantum leap in the quality of your life. Then wealth will come to you like a moth to a flame.

If you are ambitious and feel you have many goals still to reach in your life, then reading Quantum Trading can help you to improve your trading and change your life forever.

Fabio Oreste

Chapter 1

The Birth of Quantum Trading

How Einstein's Theories and Quantum Particles Affect Your Daily Trading

It was April 14, 2000, and the market was about to close. I had just placed a selling order on all of the put options I had bought a few days before and cashed in my profit. I stared in disbelief one last time at the prices on my screen. I couldn't believe my eyes! I was excited because the S&P 500 was plummeting, losing more than 180 points from the historical top in a few days, and the put I had bought had earned 128 percent. I had waited a long time, recalculating almost every day the most likely price level for a reversal and waiting for the moment when the S&P 500 price would meet with the maximum curvature point of the P-Space, the new trading tool I had been developing during the past years. From another point of view, this would have been the point at which the quantum entanglement would be relevant.

Quantum entanglement is a property of the quantum mechanical state of a system that contains two or more objects. Specifically, the objects that make up the system are connected in a way that cannot adequately describe the quantum state of a constituent of the system without full mention of its counterparts, even if the individual objects are spatially separated.

I had been waiting for this quantum correlation between P-space and the S&P 500 price for a long time. In those days I had not yet developed the software that now allows me to visualize in a few seconds the points most likely for a reversal on the chart. To calculate everything by hand, I needed a lot of time.

The week before I had warned my clients to close all of their long positions on stocks and take profits. Most of them were astonished and asked me, “Why do I have to sell when the stock exchange continues to rise and I'm making money?”

“Stock prices are likely to drop significantly soon,” I explained, “and before we see such price levels again, many years will pass.” At that time they surely thought I was crazy, but in hindsight I was proved correct. If you study my Quantum Trading techniques you will discover why.