<s> Trade LikeJesseLivermore
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Trade LikeJesseLivermore
RICHARD SMITTEN
John Wiley & Sons, Inc.
Copyright © 2005 by Richard Smitten. All rights reserved.Published by John Wiley & Sons, Inc., Hoboken, New Jersey.Published simultaneously in Canada.No part of this publication may be reproduced, stored in a retrieval system, or transmittedin any form or by any means, electronic, mechanical, photocopying, recording, scanning, orotherwise, except as permitted under Section 107 or 108 of the 1976 United States CopyrightAct, without either the prior written permission of the Publisher, or authorization throughpayment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222Rosewood Drive, Danvers, MA 01923, 978-750-8400, fax 978-646-8600, or on the web atwww.copyright.com. Requests to the Publisher for permission should be addressed to thePermissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, 201748-6011, fax 201-748-6008.Limit of Liability/Disclaimer of Warranty: While the publisher and author have used theirbest efforts in preparing this book, they make no representations or warranties with respectto the accuracy or completeness of the contents of this book and speciﬁcally disclaim anyimplied warranties of merchantability or ﬁtness for a particular purpose. No warranty maybe created or extended by sales representatives or written sales materials. The advice andstrategies contained herein may not be suitable for your situation. You should consult witha professional where appropriate. Neither the publisher nor author shall be liable for anyloss of proﬁt or any other commercial damages, including but not limited to special,incidental, consequential, or other damages.For general information on our other products and services, or technical support, pleasecontact our Customer Care Department within the United States at 800-762-2974, outsidethe United States at 317-572-3993 or fax 317-572-4002.Wiley also publishes its books in a variety of electronic formats. Some content that appearsin print may not be available in electronic books.For more information about Wiley products, visit our web site at www.wiley.com.Library of Congress Cataloging-in-Publication Data:Smitten, Richard.Trade like Jesse Livermore / Richard Smitten.p. cm.—(Wiley trading series)Includes index.ISBN 0-471-65585-6 (cloth)1. Investment analysis—Case studies. 2. Stockbrokers—United States. 3.Livermore, Jesse L. (Jesse Lauriston) 1877–1940. I. Title. II. Series.HG4529 .S558 2005332.64'5—dc2120040134900-471-65585-6Printed in the United States of America.10
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Contents
Preface
vii
Acknowledgments
xiii
CHAPTER 1
Meet Jesse Livermore
1
CHAPTER 2
Timing is Everything
9
CHAPTER 3
Livermore Trading Discoveries
29
CHAPTER 4
Livermore Pattern RecognitionTiming Keys: Pivotal Point Trading
47
CHAPTER 5
Perfecting Money Management
77
CHAPTER 6
Emotional Control
97
CHAPTER 7
How Livermore Prepared for His Day
115
CHAPTER 8
General Livermore Issues
127
CHAPTER 9
Livermore Quotes—Trading Truths
143
CHAPTER 10 Summary of Livermore Trading Rules
157
CHAPTER 11 Livermore Secret Market Key
169
About the Author
211
Index
213v
Preface
T
rade Like Jesse Livermore explains the complete Livermore TradingSystem, developed by Jesse Livermore over his legendary 45-yearcareer trading the stock market. This book explores the technical aspects of the Livermore Trading System, including Timing, Money Management, and a way to achieve Emotional Control. It deals with the detailsand secrets of the stock trading system that brought about Livermore’samazing and unbridled success on Wall Street.The information in this book comes as a result of over two years ofdeep research and many personal interviews with the remaining Livermore heirs. In 2001, I wrote the only complete biography of Jesse Livermore: Jesse Livermore—World’s Greatest Stock Trader, published by JohnWiley & Sons., Inc. This is a very personal memoir about the famous traderand covers every aspect of his life from the time he ran away from home in1891 until he shot himself in 1940.For that book, I was able to interview Paul Livermore, Jesse’s son,who was a recluse and had never spoken to anyone about his father.Paul provided insights into his father’s trading and his methods that hadnever been disclosed. Paul was 77 at the time and died shortly afterthese interviews.I also interviewed Patricia Livermore, Livermore’s daughter-in-law,married to Jesse Livermore Jr. She provided not only several personalanecdotes, but also some information about how Livermore prepared forhis day of trading and how he prepared his mind to trade in the massivepositions he often took.Livermore made four separate fortunes and caught the crash of 1907on the short side: He made over $3 million in a single day. In the MarketCrash of 1929, he made over $100 million.Livermore was not a fundamentalist in his trading approach—he was atrue technical trader. He believed that the technical trading of stocks, recurring numerical and chart patterns are nothing more than the graphic reﬂection of such human emotional behavior as greed, fear, ignorance, andhope. Livermore knew how to recognize these recurring patterns andvii
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made several fortunes as a result of this knowledge. “Wall Street neverchanges,” he said, “because human beings never change.”Through trading and market observation, Jesse Livermore found thatstocks and stock markets move in cycles within a series of repetitive patterns. He then developed a set of unique tools, using mathematical formulas and equations that allowed him to identify and interpret the movementin stocks with uncanny reliability. His amazing trading record over the 45years of his career made him one of the most famous traders to ever workon Wall Street. He is still regarded by many professional traders as thegreatest trader who ever lived.Livermore worked in total secrecy in a highly secure New York Citypenthouse at 780 Fifth Avenue, the Heckscher Building. He once wrote,“On October 5, 1923, in order to practice my new techniques and theories,I moved my ofﬁces to Fifth Avenue. I designed the ofﬁces very carefully. Iwanted to be away from the Wall Street atmosphere, out of earshot of anytips. I also wanted to gain more secrecy in my operations and more security, so that no one could know my trades. Sometimes I used over ﬁfty brokers to keep my trades secret.”It was here in these ofﬁces that Livermore applied his interpretiveskills with the technical tools available to him at the time: board boysrecording market movement on a chalkboard; telephone lines connected directly to the exchanges in New York, Chicago, London, andParis; and a number of ticker tapes spitting out the most current stockand commodity quotes. He proved his trading system over and overagain by taking advantage of the accurate price movements predictedby his trading system.Under the pseudonym Larry Livingston, Jesse Livermore was thereal protagonist in another best-selling book: Reminiscences of a StockOperator, published in 1923 (also currently published by John Wiley &Sons). That book explained what he did, like cornering entire commodity markets such as cotton and coffee, and making $3 million in a singleday by going short in the crash of 1907, but that book did not explainhow he did it.This book explains Livermore’s trading methods, techniques, andtechnical formulas. It reveals the Jesse Livermore Trading System in complete detail. All of these trading methods can be applied to today’s tradingtechniques, using personal computers and the Internet.The book explains a number of aspects of Livermore’s technical trading systems, such as:• Recognizing and proﬁting from Pivotal Point Trading• Continuation Pivotal Points and how to recognize them• One- and three- day reversal signals—how to identify them and proﬁt
Preface
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• Tandem Trading—looking at two stocks, the stock and the sisterstock• Industry Group action and how it must be analyzed and understoodbefore trading• Top Down Trading techniques• The importance of volume activity in trading a stock• Stocks breaking out to new highs and what that can mean for a trader• Break-outs from a consolidating base• Trading only in the leading stocks in each group• The dimension of time, an important element in trading the Livermoresystem• The complete Livermore Money Management systemThe Livermore Trading System can be applied to any trading time framefrom 10 seconds to 10 years, and it can be used by the long-term trader aswell as the day trader.Like an athlete preparing for a contest, Livermore considered it veryimportant to prepare himself both psychologically and physically for a dayof trading. These techniques are disclosed in this book.[NOTE: As a result of his Jesse Livermore research, Smitten currentlyis putting together a fully automated software program that allows thetrader to trade like Jesse Livermore. This software program is the main asset of a company that was taken public and started trading on the NasdaqBulletin Board on April 1, 2003, under the symbol SMKT-Stock Market Solutions. This highly technical software program has led to an even deeperstudy of Livermore’s trading methods and formulas. Much of this detailedtechnical material is included in this book.]
LIVERMORE TRADING SYSTEM—STRUCTURE OF THE BOOKThe Livermore system has three main headings: Timing, Money Management, and Emotional Control.
Timing—When to Pull the TriggerChapter 4 explores the technical tools Livermore used to determine whento pull the trigger and actually initiate the trade. This includes graphicstudies using charts, tables, and examples of Pivotal Points, as well ashow to recognize Continuation Pivotal Points and one- and three-daystock reversal patterns. The importance of high-volume breakouts are
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PREFACE
explained. Stocks breaking out to new highs are also demonstrated andexplored in detail. All these factors are necessary to fully understand theLivermore Trading System.
The Livermore Money Management SystemThis is a system used by Livermore that explains to the trader “when tohold ’em and when to fold ’em.” The ﬁve rules of Livermore’s money management are explained in full detail in Chapter 5.Rule 1—Use a unique probe system.Rule 2—Never lose more than 10 percent on any trade.Rule 3—Always keep a cash reserve.Rule 4—Don’t sell just because you have a proﬁt; you need a reason tobuy and to sell.Rule 5—After experiencing a windfall proﬁt put half the proﬁt in thebank.
Emotional ControlChapter 6 discusses how to keep your emotions under control and followthe Livermore Trading System. Livermore believed emotional control tobe perhaps the most difﬁcult thing for a trader to master. Often, a successful trader has the biggest battles within himself, in following his ownrules. Livermore’s rules for emotional control are explained in detail inthis book. A quick summary follows:• Learn from your mistakes: Keep notes and analyze every trade.• Preparation: Livermore had a daily regime, almost a trading ritual.• His Special Ofﬁce Arrangement: Keep strict ofﬁce rules such as notalking after opening bell.• Masterminding the media: Be suspicious of the news media—read between the lines.• Cut losses/control emotions: A TRADER MUST LEARN AND PRACTICE EMOTIONAL CONTROL.• Let the winners ride: Don’t dump a winning trade.• Follow your own rules.• Beware of stock tips: Never take stock tips under any circumstances.Livermore ﬁnally concluded—perhaps his most important observation—that emotional control is every trader’s major challenge and is oftenthe most important element in successful trading. He went so far as totake college courses in psychology to try and better understand the hu-
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man mind. He considered faulty emotional control as his major tradingﬂaw. He said to his sons, “I only lost money when I did not follow myown rules.”The book explains the importance of discipline in following the trading rules. It outlines how Livermore traded and how the reader can do soas well.Each chapter of this book deals with one or more of Jesse Livermore’strading theories, methods, and techniques. In some cases, they have beenupdated to take advantage of the advanced technology that is currentlyavailable to today’s technical traders. The book includes a large number ofcharts, graphs, and tables. It is designed for the trader who wants to become a master trader, like its subject.Richard Smitten
Acknowledgments
I
would like to thank my friend and partner Dennis Kranyak for all his hardwork in helping me prepare this book. Dennis hand-built all the charts inthe book and indexed, for the ﬁrst time, all the famous Livermore quotesin Chapter 9.Dennis has been with me on the Jesse Livermore journey for morethan ﬁve years while we studied all the Livermore methods, trading techniques, and secret formulas. He has always kept it fun and interesting, andI am always astounded by his facile and brilliant mind.Thanks, Dennis.RICHARD SMITTEN
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Trade LikeJesseLivermore
CHAPTER 1
Meet JesseLivermore
J
esse Livermore was perhaps the best stock trader who ever lived.During his lifetime, he was a legend of Wall Street. He was “The BoyPlunger,” “The Wolf of Wall Street,” “The Great Bear of Wall Street.”When he was alive, he was as famous as Warren Buffett is today, althoughthey had entirely different trading techniques.He was a quiet and secretive man, given to keeping his own counsel.After losing several fortunes by listening to tips and the advice of men hethought were smarter than he was, he closed his ofﬁces near Wall Street at111 Broadway, moved up to the Heckscher Building at 780 Fifth Avenue,and set up a palatial suite of ofﬁces. On one of his many trips to Europe, hehad found a manor house in England with a huge paneled library. Hebought the library, including books, paneling, and furniture. He had it disassembled in England and reconstructed in New York.The library was highly secure, with a private keyed elevator. It occupied the entire penthouse ﬂoor. When visitors exited the elevator, theyfound themselves in front of a big metal door that opened onto a small anteroom where Harry Dache would be waiting. Dache was a six-foot-six,former merchant mariner. He was Livermore’s bodyguard, chauffeur, conﬁdante, and tutor of languages and life to his two sons. Once past Harry,visitors entered a suite of palatial ofﬁces, including one large room inwhich six men worked in silence on a walkway in front of a chalkboard,posting stock prices.Once the market opened no one was allowed to talk. Livermore demanded silence for perfect concentration, so so that he could focus on themarket and the price, time, and volume signals of the stocks he was inter1
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ested in. With the ticker tape clicking, the chalkboard men posting theprices, and direct phone lines to the various stock exchange ﬂoors, thesteady stream of current information never ceased after the opening bell.Livermore considered himself a student of the stock market all his life,and he loved it.Livermore was born on July 26, 1877, in Shrewsbury, Massachusetts.His parents were New England farmers trying to scratch out a living fromthe rockstrewn ﬁelds. As a youth, Livermore was slight and sickly, whichresulted in a lot of reading and solitude. He was a boy with a quick mindand good imagination, as well as a natural aptitude for numbers.In a short while, he decided that his boyhood dreams and the adventures he had read about could not be realized in the unyielding New England countryside. At the age of fourteen, he was pulled from school by hisfather and sent to work in the ﬁelds. This only strengthened his belief thatsuccess rested in using his brain, not his body. He soon entered into a conspiracy with his mother, who supplied him with $5, and he formulated anescape plan. One afternoon, he simply slipped out of the farmhouse to themain road to Boston, hailed a wagon, and rode into the city. By chance,the wagon stopped in front of a Paine Webber brokerage ofﬁce, and hewandered inside.It was love at ﬁrst sight for Livermore. He was enthralled with the brokers’ ofﬁce, city life, adventure, unbridled youth, and freedom. Paine Webber needed a chalkboard boy to post the stock prices for the customers,and he jumped at the opportunity. As far as Livermore was concerned,fate had extended a hand, and he grabbed it. Within hours of leaving thefarm, he had a job, and with his meager funds he rented a room and became his own man before he was ﬁfteen.His mathematical brain set to work immediately as the quotes wereyelled out by the customers from the ticker tape spitting out an endlessstream. Soon, Livermore would challenge the crowd to yell out the quotesfaster. With his brain in high gear and his concentration focused, he couldwrite the numbers down on the board faster than the crowd could yellthem. He felt alive with the challenge.But Livermore was not just writing down numbers, he was in syncwith them, in harmony, and soon he began to see recurring patterns andcycling trends. He kept a notebook, and during his breaks he would copydown these numbers to see if he could recognize the patterns.He was also sensitive to the crowd. As the numbers changed and asthe stocks moved up and down, so too did the mood of the crowd. Theysaw a stock’s volume increase, and the excitement level increased. Hecould almost feel their heartbeats accelerate. He saw their eyes light up astheir trading increased. It did not take him long to ﬁgure out that as theysaw opportunities to make money their personalities changed. All of a
Meet Jesse Livermore
3
sudden, there was an excitement in the air as the price climbed. But thisexcitement often died as the stock price rolled over and fell—the crowdbecame quiet, often sullen, and sometimes despondent.Livermore was eventually able to deﬁne these emotions as greed andfear, the two dominant emotions that, he understood, drove market action. He noticed how the traders all talked among themselves, buoyingtheir conﬁdence, reassuring themselves; he also noticed how often theywere wrong.One day, the ofﬁce manager told him something that he was to wrestlewith for the early part of his life. “Hey, Kid, see how these guys all talkamong themselves, ﬁguring stuff out about why this happens and why thathappens? You see how often they are wrong? Well, I’ll tell you somethingthat could help you: It isn’t what these guys say to each other thatcounts—it’s only what the goddamn tape says that counts!”At ﬁrst, Livermore did not get it. But then one day the light went offin his brain: “Don’t concern yourself with why things are happening,only observe what is happening. The reasons why will be eventually revealed to you—by then it will be too late to make money—the move willbe over!”Livermore was a good-looking, easygoing kid, with a quick smile anda calm demeanor. His keen intelligence and natural curiosity were obvious to those who knew him. Blond with a perfect set of white teeth, hestood ﬁve feet eleven inches tall. He always wanted to be six feet, andlater in his life he owned 30 pairs of elevator shoes that raised him the extra inch he wanted. He always found ways to get what he wanted—it wasa life pattern for him.Livermore soon felt that he was receiving more than a university education, a specialty education in stock market trading. He made a series ofobservations in his diary that later helped make him millions. But he neverwas motivated only by money. Rather, he was motivated by curiosity, excellence, and a desire to be the best—the best stock trader who ever lived.He knew that the money would come. The money was the reward. Livermore made two observations at his young age:1. The majority of traders and investors lost money on a consistent basis.2. The majority of traders had no intelligent and consistent plan to trade
the market. In effect they were gambling. Playing tips. Playinghunches. Playing the favorites of the moment. Playing all kinds oftips—tips from analysts, friends, insiders.In other words, as far as Livermore was concerned, what he saw othertraders doing was simply random-action stock picking—deadly and dangerous. The same is just as true in today’s trading environment.
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TRADE LIKE JESSE LIVERMORE
It was then that he decided to spend his life developing his methods,his strategy, and his stock-picking system. He did this in secret, for hisown use. He was insatiable in his quest for knowledge. One of the clientsin the brokerage house was a professor who, one day, gave him a book onthe laws of physics, with the comment, “Maybe there is something in herethat you can apply to the market.”There was. The professor had underlined. “A body in motion tends tostay in motion until a force or obstacle stops or changes that motion.” Livermore thought long and hard about this, and agreed that momentum wasa key factor in the behavior of stocks in both directions—up or down.He kept his trading diary in secret. He was secretive and quiet by nature, feeling no desire to share his thoughts with others. He was like thisall his life. He believed idle chatter was a waste of time and that all that really counted was action. And to him that was what the stock market was,pure action—every minute was dynamic and true: pure to itself and itsown rules.One day his boss caught him making entries into his secret diary.“Hey, Kid, you trading in your head making pretend bets? Useless waste oftime, Kid. You gotta lay your money on the line in this game. Then you’llsee that everything changes for you because your emotions take over, notyour intellect. Don’t waste your time with that pretend stuff.”Livermore discovered that his boss was correct. The minute themoney goes on the line, everything changes. Even his physiology changed.His blood pressure increased, sweat appeared on his brow, he could feelhis heart beat increase—the trade loomed as the largest thought in hismind. Yes indeed, his boss was correct, but Livermore liked the rush; itmade him feel very alive.When he was 15, six months after he had started at Paine Webber, hemade his ﬁrst trade. One of the other boys came to him and suggestedthey go across the street to the bucket shop.Livermore agreed. He had some conﬁdence in the recurring patternshe had noted in his diaries, and he had developed some trading methodsin his mind and tested them on paper. He decided it was time to make hisﬁrst real trade.A bucket shop was a place where one could play the market on 10percent margin. Its atmosphere was more like an offtrack betting parlorthan a broker’s ofﬁce. The stock ticker spewed out the trades as they happened on the exchange, and the prices were recorded on the chalkboard.The rules were simple: Put up your 10 percent in cash, place a bet by buying a stock and receive a printed receipt for your purchase. Then sit backand watch the action. As soon as you lost 10 percent of the value of thestock, the house swooped in and took your money. Conversely, if thestock went up you could cash in your ticket at will. The house won almost
Meet Jesse Livermore
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all of the time. It was usually a sucker play—with the customers being thesuckers. They were simply bad stock pickers.The bucket shop kept the money. It was never used to buy the stock.The actual purchase of the stock was booked by the bucket shop, as bookiesstill do. Together, Livermore and his friend scraped together $10 to buy steel.Checking the calculations in his diaries, Livermore saw a good opportunity,and they placed their order. Within seconds, steel rose, and they closed outtheir trade with a proﬁt of over $3 on a $10 play—Livermore was hooked. Hehad made in seconds what it usually took him a week to earn at his job.Soon, Livermore quit his job and was playing the bucket shops. In ayear, he amassed proﬁts of over $1000. He returned triumphant to his parents’ farmhouse and gave his mother back the $5 she had given him and$300 more, as a present. The visit showed them that at the age of 16 hehad already become a successful stock market trader. His dumbfoundedfather accepted the money.Livermore returned to Boston and continued his trading. As he did, hecarefully recorded all his trades, studying them for patterns and trying toimprove his methods. As time went by, he became so successful that heeventually was banned from every bucket shop in America.Unable to play in the bucket shops, Livermore traveled to New YorkCity. At 20 years of age, he arrived in New York with $2500 in his pocket.His stake had been as high as $10,000, but he had suffered reversals likeeveryone else. His philosophy, all his life, was simple: “Learn from yourmistakes, analyze them. The trick is not to repeat your mistakes,” whichmeant to Livermore you had to ﬁrst understand your mistakes—ﬁnd outwhat went wrong with the trade, and don’t repeat the same mistake again.Livermore considered his days trading the bucket shops as his education, his college days, his apprenticeship. He had already establishedsome early rules. But could he follow them?The ﬁrst two trading rules Livermore had listed in his secret diaries:“Basic Rule:—Before pulling the trigger on a trade place as many factorsin your favor as possible.” Livermore felt that success was achieved whenall the basic factors were in his favor, and he concluded that the more factors he could think of the more successful he would be.The next rule was this: “No trader can or should play the market allthe time. There will be many times when you should be out of the market,sitting in cash waiting patiently for the perfect trade.”So, armed with $2500 and his experience in the bucket shops, Livermore entered the action on Wall Street. He befriended E. F. Hutton andopened an account at his brokerage ﬁrm.He began trading and almost immediately went broke. Then he had toﬁgure out why.He went to his friend and mentor E. F. Hutton for help.
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TRADE LIKE JESSE LIVERMORE
Excerpt from Jesse Livermore—World’s Greatest Stock Trader by RichardSmitten (John Wiley & Sons, 2001).“Ed, I can’t beat Wall Street right now. I’m going back to the bucketshops. I need a stake, then I’ll be back.”“I don’t get it.” Hutton said. “You can beat the bucket shops, but youcan’t beat Wall Street. Why’s that?”“First off, when I buy or sell a stock in a bucket shop I do it off thetape; when I do it with your ﬁrm it’s ancient history by the time my orderhits the ﬂoor. If I buy it at say, 105 and the order gets ﬁlled at 107 or 108,I’ve lost the comfort margin and most of my play. In the bucket shop if Ibuy it off the tape I immediately get the 105. The same is true when Iwant to sell short, especially on an active stock where the trading isheavy. In the bucket shop I put my sell order in at say, 110, and it getsﬁlled at 110, but here it might get ﬁlled at 108. So I’m getting it fromboth sides.”“But we give you better margin than the bucket shops.” Hutton said.“And that Ed, is what really killed me. With the extra margin from youI could stay with a losing stock longer, not like the bucket shop where a10 percent move wiped me out. See, the point is that I wanted the stockto, let’s say, go up and it goes down. Holding on to it longer is bad for atrader like me because I was betting it would go up. I can afford to losethe 10 percent but I can’t afford a 25 percent loss on margin—I have tomake too much back to get my money back.“So, all you could ever lose in the bucket shops was the 10 percentbecause they would sell you out.”“Yes, and it turns out that was a blessing—all I ever want to lose inany one stock is ten percent.” Livermore said. “Now, will you lend methe money?”“One more question.” Hutton smiled. He liked this boy—he was aforce to be reckoned with, a mental force. “Why do you think you cancome back here next time and win, beat the market?”“Because I will have a new trading system by then. I consider this partof my education.”“How much did you come here with, Jesse?”“Twenty-ﬁve hundred dollars.”“And you leave with a borrowed thousand dollars.” Hutton said,reaching into his wallet and extracting the thousand in cash, handing it toLivermore. “Hell, for 3500 dollars you could have gone to Harvard.”“I’ll make a lot more money with my education here than I ever wouldhave, going to Harvard.” Livermore said, smiling, as he took the money.“Somehow, I believe you, Jesse.”“I’ll pay this back.” Livermore said, pocketing the money.
Meet Jesse Livermore
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“I know you will. Just remember when you come back—do your trading here—we like your business.”“Yes sir, that I will.” Livermore said.Ed Hutton watched him leave. There was no question in his mind thathe would see him again.
Jesse Livermore made and lost fortunes a number of times. He lived inopulence, maintaining several palatial homes complete with staff, including a permanent barber. He owned a yacht, and he and his wife kept hisand her Rolls Royces. He even had a private railcar, which transportedhim to Chicago and the grain pits at the Board of Trade, although he neverappeared on the ﬂoor of any exchange.Livermore went bankrupt four different times; each time, he paidback every cent to his creditors when he got back on his feet. His skill intrading the market and the resulting incredible lifestyle did not, however,insulate him from tragic events, culminating in his suicide in New York’sSherry Netherlands Hotel in 1940.Jesse Livermore was, and still is, considered by many Wall Streettraders as The Greatest Trader Who Ever Lived. But The Greatest TraderWho Ever Lived knew that happiness was elusive and had nothing to dowith wealth.
CHAPTER 2
Timing IsEverything
L
ike the old real estate adage that everything is location, location, location, in trading