Book: Kane Trading on: Multiple Timeframes and 'Context'
September 1, 2004 Commentary (mid-week edition)-
Today I'm going to discuss some business matters, and after that I'll show an interesting new potential setup that I am keeping an eye on. These past few weeks I have been getting inundated with e-mails. I guess my plan to keep most or just about all of the details of the upcoming '100th anniversary commentary surprise' a secret in order to not have to answer a lot of questions has really backfired on me. If anything, as the time has drawn closer, it has more people asking more questions than I could have imagined.
In retrospect, I would have saved myself a lot of time if I had just laid it out right off the bat. I just wasn't sure exactly what I was going to do, and what the details were going to be, so I let it fill out and I decided what I would do as I went along. I think it's best if I lay out the majority of this right here and now, since we are so close, as it is, to the 'unveiling'. The surprise is going to be a new book. It's going to be titled Kane Trading on: A Totally New 5-Point Pattern. My plan is to have the full description and such up on the books page by this weekend.
The book is now at the printers, and is expected to be ready for shipping near the end of next week. I'll get into some particulars right now, but understand that you'll have to wait until the weekend to see the full description and such. The book is just chock-full of my very best, latest Fibonacci and pattern material. Much of it will be material never before revealed to anyone. I will be releasing the two new Fibonacci-derived numbers that I referred to in the free article Some discussion about Advanced Fibonacci Trading Concepts and the Kane Trading methodology.
These numbers form the basis for a brand new 5-point pattern, which I fully quantify and lay out, with specific alignments. But the book has much, much more than this. I decided to rectify the omission of three numbers in Kane Trading on: Advanced Fibonacci Trading Concepts, plus show some additional derivations I wish I had shown in that work. I've shown some work on the additional numbers from AFTC that really shines some light on many things that I have observed with these numbers.
I also delve much deeper into my totally unique (and previously proprietary) concepts on 'harmonicity' and 'layered support and resistance'. This is the material that I alluded to in the free article. I decided I wasn't likely to get to a revised edition of AFTC any time in the near future, so I addressed all of what I felt was missing in AFTC in this new book.
I get into many new thoughts, ideas, and concepts on patterns, and specifically on 5-point patterns. I introduce a totally new idea that I came up with called the 'Pattern Stretch' concept. I also added significantly to the discussion on pattern characteristics from Kane Trading on: Multiple Timeframes and 'Context' (in the 'Pattern Structure' chapter). As always, the emphasis is on practical things that I find useful for my own real trading, and not on theory. I've done some additional analysis on 5-point pattern structures that is unlike anything done or presented anywhere else. It's truly new, unique, and novel work.
It's also practical information, though. I've done some fascinating mathematical and geometrical analysis of the pattern structure, but I've also summarized the very amazing conclusions in various tables, to make the end results useful and easy to apply. I've also shown how I have incorporated these new numbers into the existing material that I have presented so far in my other books, and explained why I think these new numbers are critical for my 'Trading Plan'.
There is so much more to this book than the new pattern, that I am quite worried I have done a very poor job indeed choosing the title. I've already decided that if I get ten million questions asking if it's only about a new pattern, I'm going to change the title. I'm already planning several FAQ's relating to this book, and that question will be one of them. From cover to cover this book is filled with what I think is the best, brand new, cutting edge Fibonacci and harmonic analysis. It's just my opinion, but there is nothing like this material out there at all.
This leads to an obvious question: why release this stuff at all? Well, my intention was to not release it. And to answer why I did, I need to tell one of my stories. Before this idea about another book came into my head, I was having one of my many discussions with my friend and colleague over at Harmonic Trader, Scott Carney. He pointed out how the market had just reacted strongly off an .886 retracement, and I commented that in many ways, I wished I had never released that information, or for that matter, any of what I have released.
That led to one of our usually fruitful and productive 'long, heated discussions'. At the end I was quite wound up and frustrated. I wasn't sure if I should have kept it all quiet, or just done what Scott argues, and released it all. I decided that it should be one or the other, not half way. Since I've released a great part of what I have discovered, I decided I wasn't going to fence sit any more. I'm letting it out. Scott convinced me that releasing, and publishing, the material was the best thing to do (I'm still not totally convinced, but he argues so tirelessly and convincingly that you are going to get all this new material thanks to him).
I decided in this case that I was going to compromise. To me, this is the best of the best of what I have worked on for years and years. No one on earth knows this material but me. It is material that I haven't discussed with one single person to this day. If I release it here, I am not going to sell this as a stand-alone book. I will only sell it to the most serious clients, and to me that's those that have bought, or are willing to buy, a full set of the books. Sorry, but you can't have all this proprietary information for the inexpensive price of one book.
I've decided, though, to combine one of the most popular requests I get with this method of releasing the new book. I get asked a lot if I have a package for the entire set of books, or if I will give a discount for a full set. I have not offered any discounts to this day because most of my orders are just for full sets, no discount, and I wasn't even asked for a discount. I have been asked many, many times if I would do a discount on a full set, and I usually reply that I might be able to do something. I try to assess how serious the person is.
To this day I have never sold a single set to anyone who asked for a discount, even if I said I would consider giving one. So, if I had a package discount, I lose the discount amount on all the orders where the people felt the books are worth the price, and I pick up an occasional person who buys with the discount that otherwise would have passed. It just doesn't make sense. I have put an enormous amount of time and work into these books, and they are worth every penny, in my opinion, of the asking price. If I thought they were worth less, I would have priced them lower.
Plus, I don't think it is that fair to those that paid full price for me to offer discounts to some people. Hence, I came up with a plan to address all this. It's very fair to my existing customers who have bought full sets, even though I'm not obligated to do anything along those lines. It's just the type of fair and 'nice' guy that I am.
Here's the plan. I will offer an entire set package, with the previous five books and this new book, and I will discount it by just over 10%. I will also offer a package with all this material, plus the two hard copy articles, also discounted just over 10%. I am also going to throw in free shipping in the continental U.S. on these packages for the next few months.
The new book will be priced at $74.95. To really make it a good deal for the existing customers who have bought the full set (this means all five books), I will set up a separate link if you want to purchase the new book. I will factor in the price to 'upgrade' you to the package, and the cost to you will be the difference. In other words, I will apply the just over 10% discount towards the book as a credit, and you get it for that reduced price.
This deal puts all the full set customers on level ground with the new package purchasers. I think that's more than fair. I will also ship those free to continental U.S. buyers. I will offer this upgrade price for the next two months, until December 1. After that, I will allow the full set customers to buy the book at the regular price any time they want.
If you want to order the package this weekend (assuming I get the new page up), feel free to do so, as long as you understand that I will not be able to ship until the end of next week, if all goes well at the printers. If you are a full set customer and want to buy the book, please e-mail me and request the link for the purchase page.
Finally, now that this one is done, I must rest for a bit or I'll die. Once rested, I will finally get Trade Management done, I promise. I have also been getting a lot of e-mails lately asking about that. I can't take it any more having this over my head, so I will finish it up. I can't say when, hopefully by November 1, but it might take a little longer. Once I get that done, I will upgrade the package and its pricing to include that one. And then I will stop writing for hopefully a long while. I say this, as I get request after request for a book on constructing a trading plan…
Let's finish today with a very interesting chart I noticed. Let's look at a 60-minute chart of GOOG.

Chart 1
Do you see the potential setup there? Let me highlight what I am looking at, and put my groupings on the chart.

Chart 2
GOOG is setting up a nice looking 5-point pattern in here. Two very clear, very tight groupings have come together, based on .786 and .886 retracements.
There is one thing to keep in mind here. Some data vendors are not agreeing on the low of the initial day. (Many say it was 95.96. I don't know, my T&S shows prints at 95.00, and I didn't see them get reversed out. Even if they were, the perception of trades at that price may have been factored in.) In each grouping are four numbers, three of which come from the pattern itself. Only the .786 and .886 retracements key off the opening day low. If the low actually is up just a bit higher, the two retracements would move up just a bit. This would decrease the 'harmonicity' for me, and widen the groupings a bit.
Regardless of all that, I want to watch this one very closely, and see what the price action does from here. If you key off a 95.96 initial day low, the .786 retracement was hit today. This one will be interesting to watch.
The next commentary will be the weekend edition, posted on Sunday.
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