I’ve been trading in the stock market now for over a decade and when I started out the first thing I did was read about thirty books over a few months about trading and investing. I read about value investing and technical analysis.
I found learning about charting to be critical in developing a program to enter and exit stocks and control my risk. Without that you really cannot make money in the stock market.
You don’t need to read thirty books to learn all of this though. But you do need to read a few. So here are the top five books that I recommend for you to read on technical analysis:
Book 1) Strategic Stock Trading by Michael Swanson
I’m going to recommend that you first read the book I wrote about the topic a few years ago. I wrote it with the idea of giving the reader a quick overview of the subject and to arm him with the most profitable patterns I’ve used to pick out stocks. It’s been a regular best seller in the stock trading on Amazon for over five years now.
Book 2) Technical Analysis Explained by Martin Pring
Martin Pring’s book will provide you with a great introduction to the basic chart patterns you’ll need to know and a good explanation of the various technical indicators that are commonly used so that you will understand how they really work. It’s a great introduction and probably the best book to read to get into the world of indicators. But only limit yourself to using a few that you get a good feel for.
Book 3) Technical Analysis of Stock Trends by Robert Edwards and John Macgee
Published around 1950 this is the bible of stock trend analysis and a must read. A lot of “new” additions come out with people taking the original and adding their own material to it for marketing spin. So stick with this original version. It does read like a text book, but it will teach you the basic stock charting patterns you need to know, like the head and shoulders and cup and saucer patterns.
Book 4) Trend Following by Michael Covel
This book will help you understand the philosophy behind trend following. It is not some magic bullet or system. You need to make your own and this will help you start to do it. Then you can think for yourself analyze any market, from stocks, to bonds, to a technical analysis of gold. This book will help orientate you in the right direction by getting you on the wave length of success.
Book 5) Market Wizards: Interviews with Top Traders by Jack Schwager
This book isn’t about a secret trend analysis system, but consists of interviews of some of the top traders on how they became top traders and investors. It’s a great thing to help you when you start out in this game and was one of the most important books for me – the reason why is most of the people in it had a story of losing money and then learning from their losses to turn into great traders. That’s the journey I took and it helped me a lot. It’s considered a classic now.
I also suggest that you get your hands on my free technical analysis PDF titled The Two Fold Formula. It is all about the one most profitable stock patterns I have ever found when it comes to buying a stock.