Table Of ContentIdentifies and shows you how tocontrol the human emotions
that underlie most stock market losses.
By Peter WYCkoll
The PSYCHOLOGY
01 STOCK
MARKET TIMING
How investors can sharpen theirtiming and increase their
chancesof making money instocks by buying orselling at
Ihe right psychological moment.
$8.95
THE PSYCHOLOGY OF
STOCK MARKET TIMING
by PETER WYCKOFF
Here is a new and different approach to
stock market timing, based on the prin
ciples of "crowd psychology."
Peter wyckotl, a well-known Wall
Street research analyst, has made a life
long study of the psychological factors
that influence financial decision-making
and has found remarkable wallS to iden
tify and control the human elements in
investment
He has found tluu the seemingly illogi
cal bchavior of stock prices is directly
attributable to certain "psychological trig
gers" that set off a chain reaction when
released.
For instance, he shows how abnormal
weather conditions. war scares, elections,
strikes, and similar phenomena cause sig
nificant fluctuations in the price of stocks
-and he shows you how you can profit
by these fluctuations by knowing in ad
vance what the investing public will do.
He reveals how mass opinion sways
seasonal prices, and how you can entici
pate these movements to your gain.
And be demonstrates how to spot the
psychological "turning point" in daily
trading activities when prices reach their
lowest ebb-the best time to pick up the
issues you want.
You'll see how the reactions of market
professionalscanbescientificallypredicted
and acted upon.
You'll discover how to "read between
me lines" of charts and tapes. and how to
apply what be cells the Confidence Fac
tor to get the true significance of these
facts and figures.
And you'll also find out how to over
come your own "emotional blind spots"
[continued on back (lap)
[continuedfrom front {lap)
andhowto develop attitudesthat will free
youfromfollowingthecrowd,and Jet you
playthe market in a coldlyscientific, logi
cal manner.
Wyckoff reveals unsuspected psycho
logical pitfalls in many common invest
ment techniques, and points out the dan
gers in stop-orders, the scaJe-order plan,
dollarcost averaging, fluid portfolios, and
similar "formulas."
He shows why low-priced stocks are
psychologically risky- and what special
attitudes youmust adopt inorder to trade
inthem profitably.
He analyzes the so-called "hunch,"
shows you its origin and meaning, and
tells you when to follow it and when to
go directly against it.
And hepresentsanovel"normalvalue"
theory, based on psychological laws. that
helps you spot the "momentsoCdecision"
in the trading cycle-and understand the
central, controlling forces in the market.
You'll discover certain psychological
indicators that show when a stock will
havedifficultymovingupward-andyou'lJ
see how the human tendency to think in
round figures sets the price.
And the book also covers the psychol
ogy of selling short, feminine investment
tendencies, off-season buying, and many
other aspects of the market's basic struc
ture usually overlooked by other books
on investment.
Newcomer or professional, you'll find
this book a powerful addition to your
arsenalof investment knowledge andtech
niques.
PRENTICE-HALL. INC.
Englewood Cliffs
New Jersey
~to9 • Printed in U. S. of America
The Psychology
of Stock Market
Timing
Wyckoff
Peter
The Psychology
of Stock Market
Timing
~ Prentice-Hall, Inc.
ENGLEWOOD CLIFFS, N. J.
e
1963BY
PETER WYCKOFF
ALL RIGHTS RESERVED. NO PART OF THIS BOOK
MAY BE REPRODUCED IN ANY FORM, BY MIMEO
GRAPH OR ANY OTHER MEANS, WITHOUT PER
MISSION IN WRITING FROM THE PUBLISHER.
SIXTH PRINTING MAY, 1969
LIBRARYOF CONGRESS
CATALOG CARD NUMBER: 63-21061
PRINTEDIN THE UNITEDSTATES OF AMERICA
73658-B&P
Foreword
THE stockmarket behavior of man is just asde
servingof study as the eating, drinking and sex
habits of animals-the kind of studies sopopular
in many of our psychological laboratories. The
ticker tape of stock market transactions is as
gooda scientificrecord of human behavior as the
income statement and balance sheet of a cor
poration's health.
The way a man performs when buying or
selling stocks provides very definite clues to his
character. Moreover, the mistakes an average
person has made in the past are a guide to the
dangers that beset him in future. Again such a
studyisimportant, becausemore than 18,000,000
personshave a stake in today's market.
Watching his stocks move up or down is an
essential part of man's daily behavior. For some
people the market takes the place of the bull
fights of Spain, the gladiatorial combats of an
cient Rome, the jousts of Merrie England. We
$
6 • foreword
have no principal national pastime. One group is interested in
baseball, another prefers football, the wealthy like polo and yacht
ing; but not until after World War II has such a widespread
interest been evidenced toward securities.
The market has had occasional setbacks, to be sure, and
others will inevitably occur. Yet most Americans would rather
speculate than eat. No one enjoys much leisure. Everybody is
working at his or her job most of the day. Nine-tenths of the stuff
we do is routine. Even card playing has gone out among men
how long is it since you sawa reallygood poker game? We all get
bored. Speculation is about the only thing that offers the same
kind of thrills as big-gamehunting, and a man can operate in the
market right from his own desk. Call up your broker in the morn
ing, place an order without moving from your seat, and the great
adventure is on.
Between the covers of this book are some suggestions and
ideas to help you to make money. Certainly, they should help
you to save money.
Acknowledgments
PORTIONS of this book consist of an updating
and revision of one of the leading books in the
field of stock market psychology-Why You
Win, or Lose by the late Fred C. Kelly. To his
widow, Mrs. Marcelle Kelly, and to the Riggs
National Bank of Washington, D.C., we express
our appreciation for their interest.
Also, to Forbes Magazine and The Analyst's
Journalforpermissionto reprint certain material;
to M. C. Horsey& Co. for the use of all charts;
and to Challenge: The Maga-zine of Economic
Affairsforpermittingan articleappearing in their
May, 1962,issueto be reproduced.
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