Technical Analysis of the Financial Markets

This outstanding reference has already taught thousands of traders the concepts of technical analysis and their application in the futures and stock markets. Covering the latest developments in computer technology, technical tools, and indicators, the second edition features new material on candlestick charting, intermarket relationships, stocks and stock rotation, plus state-of-the-art examples and figures. From how to read charts to understanding indicators and the crucial role technical analysis plays in investing, readers gain a thorough and accessible overview of the field of technical analysis, with a special emphasis on futures markets. Revised and expanded for the demands of today's financial world, this book is essential reading for anyone interested in tracking and analyzing market behavior.

Reviews

One way to get started in technical analysis is to read a good book on the subject. One of my favorites is Technical Analysis of the Financial Markets: A Comprehensive Guide to Trading Methods and Applications by John J. Murphy. It's an easy read." -Ralph J. Acampora, CMT, Managing Director, Prudential Securities Inc.

"No one in this generation has contributed more to technical analysis than John Murphy. Through his series of books, he has both opened the door to many and raised the standard for all who use technical analysis. His book should be required reading for everyone in the securities business and are never more than a step away from my desk." -Gail M. Dudack, Chief Investment Strategist, Warburg Dillon Read

"John Murphy appears to have done it again…only this time in a more contemporary fashion. Technical Analysis of the Financial Markets is a must read for the novice and the professional and most important the Chartered Market Technician (C.M.T.) candidate. As a long-time point-and-figure chart devotee, I was enthused to see the book's point-and-figure chapter no only cover some of the more popular methods such as Chartcraft and Dorsey Wright, but also explore the usefulness of the original point-and-figure methodology which we practice here at Salomon Smith Barney" -Alan R. Shaw, Managing Director, Salomon Smith Barney

Table of Contents

Introduction
Acknowledgments
1 Philosophy of Technical Analysis 1
2 Dow Theory 23
3 Chart Construction 35
4 Basic Concepts of Trend 49
5 Major Reversal Patterns 99
6 Continuation Patterns 129
7 Volume and Open Interest 157
8 Long Term Charts 181
9 Moving Averages 195
10 Oscillators and Contrary Opinion 225
11 Point and Figure Charting 265
12 Japanese Candlesticks 297
13 Elliott Wave Theory 319
14 Time Cycles 343
15 Computers and Trading Systems 377
16 Money Management and Trading Tactics 393
17 The Link Between Stocks and Futures: Intermarket Analysis 413
18 Stock Market Indicators 433
19 Pulling It All Together - A Checklist 453
A Advanced Technical Indicators 463
B Market Profile 475
C The Essentials of Building a Trading System 493
D Continuous Futures Contracts 505
Glossary 511
Selected Bibliography 523
Selected Resources 527
Index 531

About the Author

John J. Murphy is President of MURPHYMORRIS, Inc., a producer of interactive educational products for technical analysis. A former technical analyst for CNBC and director of Merrill Lynch's Technical Analysis Futures Division, he is the author of The Visual Investor and Intermarket Technical Analysis.