In "Trader Vic: Methods of a Wall Street Master," Victor Sperandeo outlines a trading approach focused on capital preservation, trend identification, and risk management. The methodology emphasizes the 1-2-3 rule for trend reversals, the 2B pattern for identifying market exhaustion, and foundational principles for consistent profitability. For more details, visit Business Insider Amazon.com Trader Vic-Methods of a Wall Street Master - Amazon.com
2.4 The “Trader Vic” Trend-Following Setup
He uses a 30-week moving average (or 200-day) as a long-term trend filter. Entries occur on pullbacks within the trend, confirmed by:
His shorting setup mirrors the above in reverse.
- A comprehensive guide to Trader Vic's proprietary trading methods
- Insights into market analysis, trading psychology, and risk management
- Practical strategies for identifying high-probability trades and managing risk
2. The Dow Theory “Secondary Reaction” Filter
Sperandeo was a pure Dow Theorist, but he added a brutal twist: Don’t trade the primary trend. Wait for the secondary reaction against it to fail.