[BarnabeBear]

ps: while I'm at it there is something I wrote there that I meant to share here as well so I'll do my own translation (hopefully better than Google)

I wanted to talk to you about Lowry Research which I stumbled upon by chance after reading The Heretics of Finance where Paul Desmond is featured alongside Stan Weinstein. He's the head of Lowry Research and followed in te footsteps of its founder Lyman M. Lowry (1901-1991).
LMLowry put together a method after the 29 krach that developped into the founding of a research company in 1938.
The method is very much in line with Weinstein's hence my interest in it. Lowry's intention was to weigh the supply and demand for stocks as he considered that it was the primary driver of any market moves, well above any fundamental attempts to (post-)rationalize them. What he used and what the company still uses in their analyses today is mainly
- ADLine
- Volume ADLine (Lowry is reported as being the one who first proposed this now widely available indicator)
- Points ADLine (ie the sum of all dollars gained minus the summ of all dollars lost by all the stocks)
- 52w NewHighs/NewLows
- % Number of stocks above their various averages
- Three proprietary indicators: Selling Pressure, Buying Power and a shorter term BP which seem to be a synthetic indicator using the above measurements on various timeframes

When you visit their website (https://www.lowryresearch.com) you can have access to various white papers (latest available is "What if this time is different ?" with the conclusion that it is not...) and if you file for a trial period you even gain access to their weekly analysis (a 6/8 page report) and daily updates.


What thrilled me when I discovered this website is
1) we're are not alone in the universe using Breadth indicators and finding those VERY useful (cf SW's chapter 8)
2) they have a 80 years backlog of data which point to the validation of this methodology. The mere fact that they are up and running 80 years after the company was founded is a testimony to the effectiveness of the methodology they're using (who would pay a research company if the conclusions were garbage? By the way, in 2011, they claimed that 85% of subscribers were professional investors with 20% of them having subscribed for 25 years or more)
3) they love so much the ADLine concept that i) they use it everywhere (for issues, volume and points), ii) have created an Ooperating Company Only ADLine (which to me sounds VERY much like the CommonStocks version of the Nyse Composite available since 2003 from stockcharts) iii) break it down in big caps, mid caps and small caps (hence my previous question here to Dejan)

In their latest weekly note (Friday evening) they noted that their prop. Selling Pressure indicator was close to its lowest levels in 70 years and that the weight of evidence was clearly pointing in the direction of the continuation of an intact Bull market (although guarding against a potential short term correction which should be viewed as a buying opportunity window).

All-in-all very happy with discovering about Lowry Research

If you want to dig further:
1. go to their website and request their white papers, a trial period and - why not - a full membership
2. read Mastering Market Timing - Using the Works of L.M. Lowry and R.D. Wyckoff to Identify Key Market Turning Points (Richard A. Dickson, Tracy L. Knudsen, CMT - two analysts from Lowry)
3. Grab a copy of a 1975 study (Wharton) aimed at analyzing Lowry's analyses validity (The Validity of Technical Analysis: A Study of Lowry's Reports, published December 30, 1975 - http://www.worldcat.org/title/validity-o.../701396319). Apparently the conclusion to this is “…this study indicated that extraordinary gains can be achieved by sophisticated technical analysis using weak form data. This is a violation of both the Efficient Markets and Random Walk Theories.”

ps: have you ever heard of them yourselves ?