Technical Analysis Explained by Martin J. Pring is a comprehensive guide to technical analysis that serves as both a primer for beginners and a reference for experienced traders.
The book is often referred to as the “bible” of technical analysis as it covers a wide range of topics including:
- The Basic Concept of Technical Analysis: Pring starts with an explanation of what technical analysis is and how it contrasts with fundamental analysis. He explains the importance of supply, demand, and market sentiment in influencing prices.
- Chart Patterns: The book details several chart patterns used in technical analysis, such as head and shoulders, double tops and bottoms, triangles, and flags. Pring discusses how these patterns can be used to predict future price movements.
- Technical Indicators: Pring also covers a range of technical indicators, including moving averages, momentum oscillators, volume and open interest, and more. He explains how to use these indicators to generate buy and sell signals.
- Market Cycles: The book discusses the concept of market cycles, looking at both long-term secular trends and shorter-term business cycles.
- Practical Implementation: Pring also offers guidance on how to implement technical analysis in practical trading. He discusses the importance of risk management and the psychology of trading.
“Technical Analysis Explained” is known for its clear, thorough explanations and its practical, actionable advice. It is appreciated for its comprehensive coverage of technical analysis and is often recommended as essential reading for anyone interested in this field. However, as with any trading strategy, it’s important to remember that technical analysis does not guarantee success and should be used in conjunction with other forms of analysis and risk management techniques.