George Lindsay and the Art of Technical Analysis

October 18, 2011 07:00 PM
Book Review

George Lindsay and the Art of Technical Analysis: Trading Systems of a Market Master
By Ed Carlson
Pearson Education, Inc.
Published as FT Press, 2012

George Lindsay (1906-1987) published a weekly stock market newsletter, “George Lindsay’s Opinion,” from 1951 to 1972, changing to a monthly schedule until 1975, then quarterly for John Brown’s “The Adviser” until 1985. He is best know for his Three Peaks and a Domed House pattern, which suggests that markets move in predictable, regular cycles that be can be counted to time market entries and exits. In his book, which is a thorough explanation of this and other market timing methods Lindsay created, Carlson notes they can be used for stocks, stock indices and commodities.

Despite holding a view held by many market participants who use technical analysis that regular periodic cycles have no place in technical analysis, skeptics should suspend judgement until they have read this book. Everyone knows that capital commitments should be made only when two or better yet three technical indicators are aligned. Most technical tools are based on price and volume. Lindsay’s work argues that regular cycles do exist and can be counted and used for precise market timing.

To wit, on pages 143-144, Carlson writes:

“During an appearance on Louis Rukeyser’s television program Wall Street Week on October 16, 1981, when Lindsay was asked, ‘When do we get out of this bear market and into that bull market?’ he replied, ‘The end of the bear market’ the earliest I can count it is about August 26, 1982.’ The intraday low of the bear market occurred on August 9, 1982. The methods in Part IV, ‘The Counts’ (Chapters 11-14), are those methods he used to make this calculation.”

Carlson describes other Lindsay counting methods, what he calls the Lindsay Timing Model or the Low-Low-High Count, Key Dates, and the Tri-Day Method. Lindsay’s minimum time frame is one day, i.e., Lindsay’s charts usually use EOD (End-of-Day) data. Note also that Lindsay’s counts are in calendar days, NOT trading days. Even short-time-frame traders can benefit if, using Lindsay’s methods, they can anticipate or identify major turning points in markets.

The Tri-Day Method (Chapter 6) will be very useful, especially for short-term traders, because it can be used to determine that price level of a bottom. However, there are caveats, one of them being: “In any given instance, the Tri-Day Method may prove more accurate with one average than with another. It is advisable to make each calculation in two or more averages.”

Readers will find it very useful to read the brief “Conclusion” at the end of each of the 14 chapters before beginning the book itself. They also may want to enlarge the 40 time/price charts in Chapters 4, 5, 6, and 10-14 to 185% unless they have a charting program and daily historical stock index data. (Carlson, for example, used MetaStock,

Some complaints: There aren’t many copies of George Lindsay’s Opinion newsletters available now. And, Carlson does not always cite which newsletter contains a specific Lindsay quote he used, which for serious students will be a major irritant.

That said, “George Lindsay and the Art of Technical Analysis” is an important book that reveals the little-known but valuable work of an important contributor to the art of predictable market timing.

Desmond MacRae is a New York-based business writer specializing in banking, finance and investments. E-mail him at

About the Author
Desmond MacRae is a New-York-based free-lance writer specializing in institutional banking, finance and investments.