Customer Reviews

The Visual Investor: How to Spot Market Trends (Wiley Trading)

5 star:		(27)
4 star:		(4)
3 star:		(3)
2 star:		(5)
1 star:		(3)

 

 

This is the best work I've seen so far on technical analysis. I tried a couple of on-line tutorials, as well as a couple of books, and only ended up confused. This author assumes you know nothing and starts you out from scratch. I understand every sentence; it's also well-written enough that it's interesting. I'm now inspired to go on from here, perhaps with Nisan's Candlestick Charting and Beyond Candlesticks. I highly recommend this book.

This is a good starter book for the beginner, although it will be much too basic for the intermediate or advanced trader. But if you're just starting out, the first 133 pages will give you a basic introduction to the different technical indicators and chart reading. The next half of the book deals with the application of the indicators to mutual funds and other topics. I would just read the first 133 pages, and then go on to one of the more advanced texts now that you have some background, as this book by itself isn't enough to give you a good understanding of the subject. Murphy himself has a more advanced book, and Martin Pring also, and many others. Just be advised this is really just the beginning. The book is also a bit overpriced but I will say it's probably the easiest book I've seen recently for getting your feet wet on the subject.

Perhaps the most important part of the book is Murphy's mentioning that the head and shoulders pattern was investigated by the Federal Reserve and found to be statistically significant, and supposedly now is using the indicator to time its currency interventions. However, the real use of technical analysis is not that the patterns mean anything in and of themselves, its having the experience and judgment to know which pattern applies in a given situation that makes them truly useful, and the fact the traders themselves believe in them, so to some extent they become a self-fulfilling prophecy. So the field of technical analysis is itself a combination of art and science.

And actually, the most important aspect of trading is loss control and sell discipline, and understanding position sizing relative to risk and reward, since understanding the technical indicators is actually fairly straightforward, and many charting packages will do that for you anyway, so you don't even know how to understand how they're derived. And the charting packages will generate buys and sells by whatever indicator you want, but remember, it's knowing when to apply a given indicator that's the hard part. Finally, if you're planning on starting in on trading yourself, make sure you read up on and understand what's known as "money management" thoroughly before you set out--such as proper position sizing (not risking too much money on a given trade) and not selling your losers promply--an almost universal mistake among novice traders--and even pros who should (and do) know better. Good luck and happy trading!

John Murphy is able to explain technical analysis with illustrations. Technical analysis should be part of the decision-making process when investing for any fund, stock and/or options. This book is able to take you step by step on how to start and continue into the more complex versions of technical analysis.

Mr. Murphy starts in his first section with the basics: Trends, peaks, through, Fibonacci ratio, etc. These explanations are done with illustrations from actual stocks, not from made-up graphs.

His second section explains indicators: Chapters cover lagging and oscillating moving averages, trading envelopes and bands, measuring overbought and oversold conditions, momentum rate of change (ROC), Relative Strength Index (RSI), stochastic indicators and finally but not least the moving average convergence divergence (MACD) indicator. All the indicators mentioned are explained and demonstrated with real stock graphs.

Mr. Murphy in his final section explains "Linkage": He starts with the Market Linkages chapter where he sums up his previous book on intermarket technical analysis by explaining how the three major asset classes - commodities, bonds and stocks relate to each other. He explains how as commodity prices rise, which result in higher interest rates and lower bond prices, and vice-versa. He also talks about oil and gold prices and how they can affect the stock market, since they are related to companies directly. The interesting couple of pages I found were the indexes to watch while following the linkages of the market trends.

I most appreciated the summaries at the end of every chapter.

Overall the book is very educational and filled with helpful information to make proper decisions when selecting your next investment(s). One disappointment was the supplied CD. Mr. Murphy kept referring to the supplied software within the CD, although the CD only linked to his site. On his site you can find many (not free) software tools to help in your technical analysis.

Good stepping-stone and reference book for traders and investors.

Have fun.

As a day trader I've found the techniques discussed in this book give me a significant edge in my trades. The only time I've lost money in the market since buying this book is when I fell back on my old methods of trading. I've learned my lesson. Now I keep it next to my bed and review it every evening and when I'm screening for my next stock. It's an easy and concise read.

Packed with much information in an easy to read format. Contains a wealth of information on trends, charts, indicators and intermarket relationships. This is the book to get you on the road to learning visual analysis. Covers the basics in an easy to comprehend approach. It has a non-intimidating style unlike any other I have seen. This is the one to get you started on the road to successful T.A., or at least peak your interest in the subject. I highly recommend this to anyone with limited, or like me, no experience in tech. analysis, but wants to learn.

John Murphy has created a very readable source for information about the art of technical analysis. Where his first book, Technical Analysis of the Futures Markets, is more of a reference title which is very difficult to read, this book is presented in "Plain English" and is quite easy to follow. As a professional trader and technical analyst myself, I recommend this book highly. I am not aware of a better title on this subject.

Murphy has written a good primer on Technical Analysis, which he calls Visual Analysis because he feels that 'technical' intimidates novices. That should set the tone for you right off the bat.

The book's strength is that is a very basic book, what is a chart? Why weeklies? What is a trendline? How do you draw one, etc...This should not be ignored and since most people do this basic skill incorrectly one cannot ignored solid advice and Murphy does a great job on that. He also cover the major chart patterns & indicators but he does not explain the underlying psychology of the chart pattern, you would need the dry tomes of Magee & Edwards or the very complete analysis & more readable Bulkowski for that; John does not feel that part of it is necessary. He is a real 'purist'.

There is information on sectors and his pivotal intermarket analysis with a nod to sector rotation and what is a sector. All of these things make this a solid "dummies" guide, or a solid reference if you don't already own one.

The downside to this solid reference is Indicator Failure or Divergences. Murphy really does not hammer this one down & that is just as necessary as why channels (Andrews pitchforks, Raff Regressions etc) are good to know. He also does not show how channels, pitchforks et alia can show you how to visually see a pattern. But then it's a basic guide, no real flesh added on.
Just how to use the basic set of indicators, not go beyond them & read the nuances.

But still you cannot go wrong with this solid performer if you are beginning; it just won't do much more.

I have read most of the books on technical analysis and this is probably the best. The book is well organized, has great examples and charts, and most importantly, the concepts can be applied to real trading.

The book is organized in 4 sections. Section 1, deals with the importance of using charts AND fundamentals, explains when and how to use daily, weekly and monthly charts, and summarizes the most important chart patterns.

Section 2 deals with the indicators. Mr. Murphy cuts to the chase and discusses the most significant indicators in detail. I appreciated this section, because one can quickly become lost in the trees and never see the forest when trying to understand TA, and this section clearly shows the forest.

Section 3 deals with "linkage". A very good discussion on markets, sectors, economics, rotation which provides a good, top down reference for investing.

Section 4 covers mutual funds and global investing.

Mr Murphy wraps up with a summary and some great references for web sites, courses, magazines, software and books.

There are so many garbage books and information available, it is refreshing find a book and reference that is well written, logical and most importantly, usable in the real world.

This book looks like a short, cheap version of his classic "Technical Analysis of the Futures Markets", which I rate as a 5 star book. If you want to learn technical analysis, skip this book, spend a little more money and buy his classic instead, you'll get a deeper understanding (which you will need if you want to survive and prosper...)

John Murphy was the technical analysis commentator on CNBC for the longest time and was on TV almost daily for several years. He now runs his own company, murphymorris.com.

The Bottom Line: This book is very easy to read and learn and ideal for those beginners seeking to learn technical analysis. He starts with the basics, then goes into more advanced principles and then explains linkage (how certain sectors outperform when others under perform.) He talks about commodities and equities throughout the book and it is a very good evaluation of market trends. There are tons of graphs to help the reader along.

I personally believe that technical analysis should be incorporated into just about any decision-making process when investing for any fund, stock and/or options. While fundamental analysis should be where most efforts are applied technical analysis can help people in picking entry and exit points to "avoid fighting the tape" which is a real trend in the market.