Tom DeMark finds the time: Creator of DeMark Indicators

Introduced by Guido Riolo, Bloomberg’s Head of Charting, as ‘a genius of the world of finance’ whose Sequential®, Combo®, and TD Lines® the terminal supplies, audience expectations were running high at the STA’s monthly meeting. A heavyweight in the world of technical analysis, with 44 years’ work under his belt, he and his posse arrived from the US this week.

With an elephantine memory of stock market moves (he started following the markets in 1971 going full time at America’s National Investment Services in 1972) he took us through a series of old – perhaps too old for some – examples of his market calls. Having worked with the Bunker-Hunt brothers as they cornered the silver market in the early 1980’s and who then ignored his recommendation to sell out, when reiterating his call as the price plummeted they asked, ‘sell to whom?’ A lesson to us all that in bull markets one must prepare to sell into strength, and in bear ones remember that they end when the last bear has sold.

Tom DeMark with Guido Riolo, Bloomberg and Axel Rudolph, Chairman STA

Tom DeMark with Guido Riolo, Bloomberg and Axel Rudolph, Chairman STA

He insists, ‘I am not a pure technician in the conventional sense’ as ‘everything we have developed is anticipatory’; his focus is market timing, adding my ‘whole background is institutions – not mental though’ as his wife often reminds him! Focusing on the difference between daily opening prices from the previous close, rather than close to close, pessimism grows if they gap lower or if they ‘foot downside’ (close lower). He then compares this with the previous four closes and if the most recent close is ‘flip downside’ (below the last four) it suggests a change in tone, if not trend.

Interestingly he claims his personality changed in February 2016 and that he is finding the US stock markets extremely tricky. Due in part to ‘the authorities who have disrupted the natural rhythm of markets’ nevertheless he has not adjusted his models because ‘trends can be delayed but ultimately will win out’. Claiming he hasn’t slept in days, exacerbated by a long plane flight on Monday, he had a couple of senior moments and was ably rescued by his two protégés.

The presentation has been recorded and will be available shortly to members only on www.sta-uk.org

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The views and opinions expressed on the STA’s blog do not necessarily represent those of the Society of Technical Analysts (the “STA”), or of any officer, director or member of the STA.

The STA makes no representations as to the accuracy, completeness, or reliability of any information on the blog or found by following any link on blog, and none of the STA, STA Administrative Services or any current or past executive board members are liable for any errors, omissions, or delays in this information or any losses, injuries, or damages arising from its display or use.

None of the information on the STA’s blog constitutes investment advice.

About Nicole Elliott

Nicole Elliott

A graduate of the London School of Economics and Political Science (BSc Social Psychology) Nicole Elliott has worked in banks in the City of London for the last 30 years. Whether in sales, trading or forecasting technical analysis has always been the bedrock of her thinking. Key expertise lies within all areas of treasury: foreign exchange, money markets, fixed income and commodities.

She has also added to the body of knowledge of the industry writing the first western book on Ichimoku Cloud Charts. Strong media links and a cult following are due to her prescient calls on the markets and often entertaining format.

Nicole can be contacted at trending@sta-uk.org

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