Trade Like an O'Neil Disciple: How We Made 18,000% in the Stock Market

8.13. CONCLUSION

Overriding all of these rules, rules that go beyond many of the rules most investors are familiar with through his books and other writings, is a basic concept of always striving to operate with purity and simplicity. O'Neil doesn't get bogged down with tracking a multitude of indicators, relying instead on pure price/volume behavior as an old tape reader to discern where the big money is flowing in any market environment. Through his own experience and study, O'Neil understands that some indicators have a limited lifespan, and that 15 years was only a slice of the big picture. O'Neil keeps his system pure and simple. He doesn't get bogged down in minutiae. The indicators he does use have proven themselves over many market cycles. They were just as useful back in the 1920s, an entirely different era, as they are today, because they are based on human nature, which has remained constant. O'Neil primarily relies on the elements of price/volume behavior of the leading stocks and major indices on weekly and then daily charts, the shape of the patterns the stocks and indices trace out, relative strength, the relative strength line confirming new highs, institutional sponsorship, the accumulation/distribution rating, group rank, and the 50-day moving average. If you want to witness simplicity in action, work with Bill O'Neil, and you will soon realize that all your market indicators, gadgets, and gizmos are not necessary to the process of making big money in the market. ...