Technical Analysis of the Financial Markets: A Comprehensive Guide to Trading Methods and Applications (New York Institute of Finance)

This is an excellent book for someone who knows their market basics, and perhaps a little technical analysis, and wants to move toward a more intermediate level in the subject. The book is extremely clear, well-written, and balanced in its coverage. In a field with much poor writing and extravagant claims it's almost a joy to read (if one is so inclined). It was easy to spend the better part of an evening getting through 100 or more pages without getting confused or bogged down, or feeling like it was hard work. I found most all of it very thought provoking.

While the book basically focuses on trend-following techniques -- about which I have many reservations -- the book also covers numerous contrarian tools as a way to time an entry into the predominant trend during a shorter-term pause/pull-back/consolidation period. The emphasis is as much on charting techniques as on strictly numerical indicators, and Murphy is probably at his best in explaining how best to use this or that item in the toolbox to ones advantage and what its limitations are and what can go wrong. The overall tone is very solid and realistic. I especially liked his clear exposition of the important differences between the futures/commodities markets (where many of these techniques originated) and the stock market.

I'm marking it down one tick for a couple of reasons. First, I would have liked more quantitative depth; qualitative discussions such as this can only take one so far toward actual applications. Second, there's virtually nothing here on options and their effects on the markets; the same could be said about computerized trading systems (some coverage but not nearly enough). Third, there were a couple of glaring ommisions: in talking about saucer bottoms he doesn't mention the well-known tea-cup-with-handle formation even though the handle shows clearly on the chart he uses to illustrate it; when talking about simple moving averages he neglects to mention the important "box-car" effect of big changes moving out the tail end of the averaging period; and while Wilder's RSI gets plenty of good coverage the recipe for it he gives is a bit misleading in that it only allows one to construct the first value, not any subsequent values. And, fourth, I think he gives period analysis and Elliott wave theory more attention than is deserved and never mentions the application of Fourier techniques in this arena; I could say much the same with regard to ideas based on Fibonacci numbers (perhaps I'm yet unconvinced in these areas). So the book could have been better in some places.

For their historical significance I especially liked all the charts from the 1997-9 time period which show things in the glory days just before the top of the market bubble in 2000: Intel at $100 ($20 today), Bristol Meyers at $95 ($20-25 today), crude oil at $16, etc. [I was trading Micron (pg 127) actively during the period when it spiked to $60 ($12-13 recently) and remember those days well]. So the many charts used to illustrate various things were a bonus to me, though they remind me there was no mention of market manias and how to correctly read extremes and their subsequent breakdowns. Perhaps it would have been asking too much for a closing chapter prognosticating the future as he saw it then, though it would have been interesting had he thought to write such a chapter. This is still a very good book for what it is. 4+ stars.

With all the good reviews on Amazon, I thought this book must have something new or different to offer but it doesn't. I've read more useful, less bulky and cheaper books on technical analysis than this. However, students might find this book useful, but examples are basic, often drawn by the author while real samples have been carefully selected and readers might be misled into thinking technical analysis is easy.

I've worked as an equity trader for more than two years and I found nothing revealing in this book. In fact the first half of the book deals with such simple issues as drawing lines under the low points of a share price, share prices falling below the trend line (sell the stock), similarly, it talks about breakouts, and high volume key reversals. Any active trader would have figured most of this information out from common chatter between colleagues or friends, or by themselves without the need of any book. As for the summary chapters on Japanese candlesticks and other theories there's not enough detail to make it worthwhile and similar summaries are widely available in other books for far less money.

I suggest beginners take a closer look at something less bulky while anyone with experience should definately avoid this book.

I found this is not really the book to read from cover to cover in one go, but more a reference book to give you an overview of many different methods of technical analysis. I have kept it by my computer for months now and every time I come accross a new indicator or analysis concept I happily refer to it.
It has been a great resource for me.

I dont know how this book only has a 4.5 star rating. I have read many technical books and this one is the best by far. If your serious about technical trading you absolutely need this book.

Have you decided that it is time that you understood what this market analysis stuff called "Technical Analysis" is all about? Then you should start with this book by John Murphy. Is it the best book on TA? It's certainly in the top three, and written by a man who has worked hard to educate people on charting, trendlines, indicators, systems, oscillators, etc.

Will you immediately become a successful trader by reading this book? Let's just say you have a heck of lot better chance at being a successful trader if you read, study, and integrate into your market research process what this book teaches.

If you are only interested in long-term investing, you probably don't need this or any of the other Technical Analysis books. But, if you want to trade on a daily, weekly or perhaps even monthly basis, you would be well served to read this book so that you at least understand what factors and indicators other people in the marketplace are watching -- people against whom you will be competing for profits.