Trading Price Action Reversals: Technical Analysis of Price Charts Bar by Bar for the Serious Trader

I've read Al Brooks' book called Trading Price Action Reversals, and it is easily the most detailed book that I've read on the topic of reading price action. This is not an easy read on the subject of price action, and it is a PhD level dissertation on the topic. The book is so detailed, just like the Trading Ranges and the Trends books, and it will be slow and clumsy to read, so take your time. It could easily take a month to read this book, but it will explain so much that it will pay for itself almost immediately. I do have some pointers on how to streamline the reading process (and it IS a process with Al Brooks' books!).1) Get a highlighter pen and highlight tips and observations, but not individual chart information. For example, on page 137 you should highlight, "Spikes are tests of the strength of both the trend and countertrend traders", but do not highlight "In Figure 4.8, the bar 1, bar3, and bar 6 bear spikes...". If you were to highlight the detailed information from each chart you would go crazy and the books would be a coloring book filled with bright yellow highlighter pen, and you could go blind from that!!2) Study the SPY/ES charts, and review Al Brooks' videos on YouTube.3) Trade and review each setup on the chart. After reading any of Al Brooks' material, put the book down for a month, and then re-read it. This time just read the highlighted portions of the book. The book will be far more easily understood after you study SPY/ES charts and then pick up the book for a second time.4) After reading and highlighting Al Brooks' book, you should then print out charts that you will likely trade. To study the charts, print them at random. For me, I trade the SPY, so I printed out random SPY charts from the last two years, and I printed out 2-Day charts with 5 Minute candles. You'll want to print out two day charts, since the previous day's price action influences the current trading day's price action.5) Once you have a pile of 2-Day 5 Minute candle charts, cover up the second day with a sheet of paper so that you can't see it. Slowly move the sheet of paper to view each candle, one at a time, like you would see the trading day unfolding in real-time. Now verbalize each bar that you slowly expose, and write down your observations about each candle. Draw trend lines, wedges, and failed final flags as they are exposed by moving the paper slowly to the right. Draw long and short entries and stops, and record your results. This could take a while detailing what you see on each candle, but that will change the better you get. It took me 2 hours to get through my first chart like this. Do one of these each day. Don't worry, it gets faster!!6) Review your detailed chart observations. You'll be amazed how much data you can pull out of each candle. Save your charts and your data, and pretty soon you'll have a whole pile of your own data and trade setups, Al Brooks style.My only real complaint about the book is that you don't get an independent diagram about what a failed final flag failure looks like, and it took a while to be able to visualize that pattern, and a few others.I've been trading the stock market since 1987, and these books answered a lot of questions right away, and helped my trading immensely. Reading price action has never been easier!Other resources you might want to consider would be Gap Edge Trading, as I made plenty of money trading in their chat room, and so have a lot of other people.Good luck and nail some reversals!!

Dr. Brooks' book is not an easy piece to read. In fact after first few pages I was tempted to put it back on a shelf. Unlike other authors who publish trading books Brooks started with one of the worst/boring/repetitive introductory chapters I have ever seen. However putting his boring writing style aside this is probably the best book on trading I have read. Al Brooks explains in great detail (with countless repetitions) the logic behind every price movements, he does excellent job putting in your head several basic principles of trading which usually you learn after you blow one or more accounts., E.g. most reversal attempts fail,most breakout attempts fails especially those that occur after a series of barbwire (doji) bars etc.... Finally, and what I like the most , he teaches you how to read emotions of traders on both sides of the trade. For example if there is a rally then bears suffer, they cover they shorts (he points to specific bars when most of the covering occurs) and this leads to sustained move up. Bulls smell bears' pain and add to their positions, making sure that rally keeps its momentum. To an experienced trader those things are obvious but I can guarantee that after spending few days/weeks with this book you will develop new perception of the markets and many things that baffled you before will start making sense. Although the repetitions in the book may seem annoying they actually help a lot because if the same key information appears all over the text there is a high probability that you will memorize it after just one reading.If you are real beginner though this is not the book for you. You may buy it but most likely you will end up frustrated with some of the terminology Brooks uses. For beginners I would recommend "Mastering the Trade" by John Carter - which is a real pleasure to read because of John's lucid and entertaining writing style. But before fully embracing Carter's trading methods (he appears to be a bit of the indicator junkie) you should read and understand what Brooks has to say.