Technical Analysis for Dummies

by Barbara Rockefeller

Grasp and apply the basic principles of technical analysis

Savvy traders know that the best way to maximize return is to interpret real-world market information for themselves rather than relying solely on the predictions of professional analysts. This straightforward guide shows you how to put this into profitable action--from basic principles and useful formulas to current theories on market trends and behavioral economics--to make the most lucrative decisions for your portfolio.

The latest edition of Technical Analysis for Dummies includes a brand-new chapter on making the right decisions in a bull or bear market, an updated look at unique formulas and key indicators, as well as refreshed and practical examples that reflect today today's financial atmosphere.

Become an expert in spotting market trends and key indicators Get the skinny on the latest research on behavioral economics Take a deep dive into how to read market sentiment and make it work for you Get a look at the first innovation in charting for decades--straight from Japan With comprehensive coverage from charting basics to the cutting edge, Technical Analysis for Dummies includes everything you need to the make informed independent market decisions that will maximize your profits. Happy trading!

Genres: Finance, Nonfiction, Business, Economics, Reference, Money

384 pages, Paperback

First published March 5, 2004

Reviews

[Chris Esposo · Rating 3 out of 5]

Having bought 4 different “For Dummies” books, ranging from how to analyze penny stock, buying a house, and quantum physics, i have to say that the moniker attributed to every book in this series often understates the sophistication found within the pages. This is definitely the case for “Technical Analysis For Dummies”, a newer title in the series, it fills a real gap for younger/newer investors/traders, who often have a wide range of resources to access online, but those resources often come with a lot of embedded narrative biases and/or holes in their explanation, which leads to inadequate instruction.

My first introduction to technical analysis was from the perspective of taking standard courses in investments and economics, whereby the prevailing orthodoxy (at least within the context of undergraduate instruction) viewed the subject as ‘voodoo’. Of course the subject is beyond the scope of an introduction investment text, which is often centered on ultimately learning the CAPM, and the associated EMH theorems/results. It was not until much later on did I understand that technical analysis as a subject matter hails from a much richer history than mere “voodoo’, and there’s an excellent little book published by a well-noted MIT finance professor, Andrew Lo, titled “The Evolution of Technical Analysis” that reveals some of this history.

I read this book after I read Lo’s small history, and after meandering through a plethora of investment books (mostly layman), which includes all the usual suspects like “A Random Walk Down Wall Street” and Graham’s “Intelligent Investor” as well as a half a dozen other lesser known text in the domain. My interests in technical analysis occurred after I read Mike Coval’s “Trend Following” book, which although voluminous in page count, has very little instructional value for those who knew little about trend following or technical analysis (often times Coval “talks about” trend following, without ever really defining it , except once or twice towards the end of the audiobook).

This interest was reinforced after Coval’s book when I started taking a graduate course on the machine learning applications of trading, and this was the real reason I picked this book up, as I needed a few external references from a practitioner standpoint on technical indicators/filters that allowed me to better deal with these notions from an algorithmic standpoint. This book does a good job of defining and contextualizing how to read charts. The manner of instruction is hands-on with respect to concrete examples. Nothing is in the abstract, and the most “technical” notion found in the text is a regression, which is used prominently in the discussion on channels. Really, if you understand the standard error, the sample mean, a bit of regression, and momenta, you really have all you need to grasp this book.

After reading this text, you should have command of “the jargon”, which includes things like retracement, trends, resistance, support, divergence, convergence, breakouts etc., as well as how these notions fit in a standard technical analysis. That being said, it is by no means “advanced”, and those who come to the text with more sophistication should probably not pick this one up. I can see at least two kinds of people who would find value with this text:

1. A fairly technical person who is first learning the principles of trading/investing and needs a fairly straight-forward reference text to help integrate their knowledge of the fundamentals of the field, and who will use this text to springboard a more advanced or detail follow-up book

2. A retail investor who needs to equip themselves with the fundamentals to make sound and unbiased judgements on their trading position, and who needs the knowledge to help them adjudicate the veracity of discussion of companies, trades etc., in popular magazines, blogs, and forums within the subject of trading/investing (CNBC, Yahoo Finance, Barrons, etc.)

If you know stochastic calculus, stay away. There’s probably better books for you. Also, anyone who is sophisticated enough to know how options contracts work is probably far too advanced to profit from this text. However, this text would definitely be a nice gentle destination for someone who is building up to learn that level of information (with additional experience/education). Overall, I think this is a well written text, with a well-defined audience, and should not be avoided for its namesake by those who want to quickly get up to speed in the world of technical trading. Conditional recommend

[Voxie · Rating 2 out of 5]

This book is exactly how the title makes it seem: it's an introduction to technical analysis. The topics are broad, spanning everything from reading charts to interpreting a number of different technical indicators to managing trading risk, and they are applicable to any type of securities trading (equities, futures, currencies, and so on). These topics are also covered in introductory trading books, but Technical Analysis for Dummies goes into them in a bit more detail in its 300+ pages.

I would recommend this book to anyone who has an interest in using charts and indicators to trade securities. It's definitely a good place to start, but for the true aspiring technician, this should only be the first step.

[William Schram · Rating 2 out of 5]

I generally go to the library every three weeks and get books that sound intriguing. It allows me some room to make mistakes in my choices. I have read books on Value Investing before so I wanted another point of view.

Technical Analysis For Dummies is a book by Barbara Rockefeller. It talks about using charting and graphs to navigate the confusing complexity of investing.

I wasn’t able to get into this book at all. I don’t know what’s going on with that, but it just didn’t grab my attention.

[Bernardo Pio · Rating 4 out of 5]

The book gives exactly what it promises. If you are a beginner, go for it. The bonus is: the book has great references to more specific works quoted in the text so if you’re interested you can go for it.

[Kris Wright · Rating 4 out of 5]

Picked up this book for Christmas. I wanted a book that would introduce me to TA in a way I could understand and that's what I got. Goes in depth just enough for an intermediate beginner to trading securities.

[Jairo Fraga · Rating 3 out of 5]

Livro útil para inciantes, já que abarca praticamente tudo o que se pode ser pensado que um "leigo" deva saber, como uma miríade de indicadores, alguns padrões gráficos, gerenciamento de risco, etc.

A tradução é lamentável, parece ter sido feito automaticamente na internet, e custei a identificar algumas coisas como "negociação de guerrilha", que seria o scalping. Realmente não acrescenta muito para quem já tem algum conhecimento de análise técnica, mas pelo menos o valor do livro é barato, se comparado com os demais do mesmo assunto.

[Elizabeth · Rating 5 out of 5]

Well written and comprehensive. Good starting point for beginners. Really good appendix of additional resources to set you on your way. Anyone who lived through 2008 knows it’s stupid just to buy and hold. You should instead get the hell out, and knowing how to read the charts/indicators is where you should start. Same goes for knowing when to get back in.

[Andi Al Farizi · Rating 3 out of 5]

Very recommended to any person who doesn't have any idea what technical analysis is.
But, this book doesn't really help you understanding it.

In the end, what you got is much more "keywords" you need to dig deeper later.

[Piotr · Rating 4 out of 5]

Great boook for the beginners and not only. It contains very useful information, written in an understandable way. Great value !

[Baldjeff · Rating 5 out of 5]

very good . clear descriptions of technical concepts with useful examples. Charts are well-chosen to reinforce concepts.

[Jasper Yiu · Rating 3 out of 5]

Not for dummies

[Andre · Rating 4 out of 5]

A good start. It not only covers the what of technical analysis, but some of the why. I.e. why you'd use one approach vs another, how they can be combined, etc.

[Andrew Goh · Rating 4 out of 5]

Good introductory book for those starting out on Technical Analysis.

[dgx · Rating 5 out of 5]

Great introduction to technical analysis. Prepared me for further study by explaining core trading concepts. Examples are limited but useful (its a book after all)

[Dawith · Rating 1 out of 5]

You probably won't learn anything of use. Full of bullshit 'pattern finding' that consists entirely of retroactively fitting 'patterns' with zero predictive powers.

[Keith Mundy · Rating 5 out of 5]

This book takes complicated strategies and presents them as simple, easy to understand and follow procedures. It is a must for novices and experts alike.

[Derek · Rating 5 out of 5]

A great introduction into technical analysis with a lot of tips along the way.

[DW]

Rock solid Wiley.

[Sara Thesara · Rating 1 out of 5]

نصف حقائق مخلوطة بآراء شخصية وبعض المغالطات. كما أن إسلوب الكاتبة كان رديء بحق حيث أنني كنت أتطلع لصلب المعلومة لكن وجدت نفسي في دوامة مقدمات لا تنتهي.


Side note:

Barbra بالفعل اسم على مسمى

[David Roberts · Rating 5 out of 5]

The book I read to research this post was Technical Analysis For Dummies by Barbara Rockefeller which is a very good book which I bought from kindle. Technical Analysis is about analyzing the Stockmarket to see whether you should be selling your shares etc. Quite a bit of the book is about candle stick charting & I did read a book called Candle Stick Charts For Dummies which I do recommend reading. When you follow the market ie you hang on to shares or buy more in a particular company when lots of people are doing the same that is called contraining. If you notice people should be selling shares in a particular company even though they aren't and that company has reached what we call a pivot point and you sell your shares that is called non-contraining. The people who buy shares are called bears & the people who sell them are called bulls. When you have a bull market it means most people are selling their shares. I think for a dummies book this book is complex but it's a complex subject. On the whole it's a good book.

[Rob Landi · Rating 5 out of 5]

Great way to get a handle on how to perform technical analysis on the stock market as well as company stocks.

[Erik Johnson · Rating 1 out of 5]

Do not buy this book for your I pad. I could not read or download the charts. I contacted Kobo customer care and they could not help me. Kobo said they could not fix the problem and gave me a credit. I feel the book is essentially useless without the charts (given it is about technical analysis!).

[Stuart Wasserman · Rating 5 out of 5]

Fantastic book, one for beginners and veterans as well. I started trading 34 years ago and picked this up at the library to brush up on what's new and it really helped me get back into the swing of things.

[Mudpie · Rating 2 out of 5]

This book was very technical and it's certainly not for the faint hearted. Technical analysis needs a lot of time and busy folks like me don't have much time for this. Will revisit this book again in the future perhaps....

[Stephen Chung · Rating 2 out of 5]

Very little use.

[Jon · Rating 4 out of 5]

I generally don't read "Dummies" books, but I found this one to be worthwhile. Sure there were sections that I merely scanned, but the presentation and descriptions seemed adequate. Recommended.

[Valters Bondars · Rating 3 out of 5]

6/10

[Dave · Rating 5 out of 5]

Great grounding for Technical Analyis.

[Awinash Jha · Rating 4 out of 5]

To a starter in the field of chart reading or technical analysis it's a must have ...I learned the ropes from this book itself . It has cover the fundamentals well.

[Vasco · Rating 4 out of 5]

Great content. Top level but very effective. Good references to other books.