In How Technical Analysis Works, you will progress from the history and logic of technical analysis through various kinds of charts, chart patterns, trends, trend lines, oscillators, and indicators. Bruce skillfully shows how each indicator works. And, equally important, when you should not use the indicator.
While the simple and clear explanations are unique features, How Technical Analysis Works also offers technical tricks, tips, and techniques-based on Bruce’s quarter century of real world experience-that are unavailable elsewhere. Once you have finished absorbing these lessons, you will be armed with an array of weapons for trading and investing in today’s markets.
Introduction:
How Technical Analysis Works offers a tested approach to technical analysis. The book is organized in an order that builds comprehension and skills in a logical way to make it easy to understand the subject. My goal in writing was to provide investors, traders, and students with a good first book on technical analysis prepared for the twenty-first century.
Regardless of your level of experience and investment knowledge, this is a book you will keep and refer to for years to come. How Technical Analysis Works is the one book that tells you what is important, the book that shows you how technical analysis can be a timing tool, a selection tool, and, most important, a risk management tool.
The importance of using technical analysis as a risk management tool can’t be stressed enough. Reduced to the basics, there are really just five possible outcomes from investing or trading-a large loss, a small loss, flat or unchanged, a small gain, or a large gain. The small gains and small losses will cancel themselves out along with the trades that are “scratches,” or unchanged. Of the five outcomes, if the application of technical analysis can help you avoid large losses, then we are left with the very desirable outcome of large gains. That is what we are all looking for.
Contents:
- HISTORY AND BACKGROUND
- HOW TECHNICAL ANALYSIS DIFFERS FROM FUNDAMENTAL ANALYSIS
- THE ROLE OF CHARTS IN TECHNICAL ANALYSIS
- KEEP YOUR EYE ON THE TREND
- THE KEY BUILDING BLOCKS OF SUPPORT AND RESISTANCE
- PAnERNS TO PROFIT BY
- REVERSALS CAN KEEP YOU ON YOUR TOES
- CONSOLIDATIONS ARE GREAT ENTRY POINTS
- GAPS: WHAT’S NOT THERE IS WHAT’S IMPORTANT
- DRAW YOUR OWN TREND LINES AND CHANNELS
- MOVING AVERAGES SMOOTH THINGS OUT
- USING RELATIVE STRENGTH FOR SELECTION
- GETTlNG CONFIRMATION WITH VOLUME
- THE UPS AND DOWNS OF OSCILLATORS
- WHAT’S SO SPECIAL ABOUT RSI?
- STOCHASTICS
- A FEW LOGICAL INDICATORS TO FOLLOW
- OVERCOMING THE PITFALLS: REAL-WORLD TECHNICAL ANALYSIS
- PUnlNG IT ALL TOGETHER: CASE STUDIES