Encyclopedia of Chart Patterns

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Summary: excellent book, the ultimate
Review: I have been trading formation from this book and I have made a lot of money so far. I recommend this book for beginners and advanced students.

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Summary: Essential, an authentic classic
Review: I have been using statistical techniques for many years and thought most "patterns" are mostly in the eye of the beholder. I have yet to see a head-and-shoulders. But some patterns are so obvious that recently I have looked for definitions and explanations. This author not only provides them, but also has done the heavy lifting of testing 500 securities over 5 years in order to say how often each pattern is successful, how much you are likely to make from it, etc. This has never been done before and is very useful. "Encyclopedia" went to my top 10 technical analysis list in the first ten minutes I had it. It will be the most dog-eared book since Edwards and Magee.

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Summary: Encyclopedia of Chart Patterns
Review: I have searched for quite some time for a definitive text on the subject of charting...most of the books show general patterns that are bland regarding your ability to translate the chart pattern into trading profits...And here is the distinctive difference with Thomas Bulkowski' book...he has well researched statistical behavorial patterns and expectations for these charts...so not only are they described...but their behavior patterns are tracked giving great insight on what to anticipate for future stock pattern trading performance...I recomend this book...

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Summary: Unique book on chart patterns
Review: I was impressed on the format of this book but keep in mind that the statistics in this book are only from the authors choosen "litmis test" / own research and aren't concrete examples of the everyday marketplace.. If you take in account that he only covers specific periods of time on his test that the market could have been in a particular trend (ie bull/bear/consolidating) at that time and could be inaccurate stats.. Basically the stats are not based off a complete database of the market and are not done with consideration of the trend (correct me if I've misread)..

I have not yet applied these priciples to the market I am still learning tech. analysis.. It is one of the better books on the subject.. Although hypathetical the "Sample Trade" and "Trading Tactics" sections are very helpful in developing a trading strategy..

It is maybe an intermediate book not really for beginers in that it is very technical without a lot of explanation on how to best use the book.. A beginer can how ever learn to work around this should he/she read the sample trade and trading tactics sections.. I thought their should have been explanations on decipering what type of time frames were looking at on the actual chart diagrams of the chart patterns as differnt time horizons give different patterns..

I came to this section to view what other peoples opinions were on this book to get a leg up on my readings and ending up writing a review myself because there were no reviews..

You will learn how to:
*Identify the leading chart patterns and recomodations of applying them

Don't get this book if you plan on using it solely to pick stocks with.. You will not learn a trading system from just this book..

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Summary: Put it to the test, secone review
Review: If you use Bulkowski Head and Shoulder trading tactics ( page 273) you will be disappointed. Computer testing (1968 - 1986) produced low profits of only 8.85 NYSE points when using his system.

More conditions , such as symmetry of pattern, neckline penetration,and volume confirmation ( decling volume at tops and rissing volume at bottoms) will produce better results.

If he uses pivot point channels to define resistance line of HS bottom formation, (neckline in this case) and act on upward breakout. This method will produce 95.93 NYSE points profit.

Furthermore, optimized with .75 points trailing stops produced even better results than 1/8 traling stop in his system. In conclusion, this book lacks backtesting and optimizatiuon and therefore its ...

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Summary: method of trading successfully
Review: is not found here. Wordy beyond tears. Could have easily been 100 pages instead of 600. A mere pretender to the classic by Magee and Edwards.

Tedium must be the Bulkowski philosophy. I really felt he did little to clarify any technical view what-so-ever. Every page is an endurance test of what's his point and where to find it. It promises theme, but delivers anecdotes.

Loaded with questionable statistics, methodology and wordiness any reasonable trader can only come away with a feeling that this book was written for the sole purpose of making the author a buck.

What this book lacks in originality it makes up for in a scholarly pomp. Perfect for a non traders library.

The patterns are previous, The tactics non profit. This would be the last book in my trading library.

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Summary: Author's Defense!
Review: Let me thank Barry Rudd and others for coming to my defense.

I measure the failure rate in two ways. First, when a pattern fails to perform as expected, it's logged as a failure. Also, and I thought this a unique approach, when a pattern fails to travel in the expected direction by more than 5%, it too is a failure. Both methods are combined to form the published failure rate. With some reader comments, the second benchmark is too low. Perhaps 10% or 15% would be a more realistic gauge. I agree.

If you distrust the failure rate, look at the statistical summary (a large table of important stats) starting on page 654. That's where you can compare each of the nearly 70 pattern variations against one another. Trade the ones that perform best and ignore the rest.

As to the hanging man chapter: No excuses. I blew it. The small picture at the chapter start is incorrect according to the traditional definition of a hanging man.

On page 10 of the book, near the bottom, in bold type is "The Sample Trade." The paragraph explains that the sample trades are mostly fictitious and are used as literary devices so that you may learn from the case study.

Too wordy? Well, I'll work on that. The publisher says it's selling well enough to be translated into other languages, so I may have another chance to fix these problems in a second edition (many years away, if ever). Thanks to everyone for pointing out the problems.

Please direct any questions or comments to me: Tom Bulkowski [e-mail]. Tell me how I can make the book better!

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Summary: Good but need revision
Review: Technically, this is a very useful book in that it presents hard to find statistics on the patterns like the price expectation, failure rate, very detailed. For example, the author even included a statistic on the volume behavior for the 'head and shoulder' pattern, which is very helpful. -You may not find those facts in any other book. The approach the author took is certainly a step forward towards 'scientific' technical analysis.

However, the presentation is poor and too wordy which makes it uneasy to follow, especially when you compare it with the classics like John Murphy ans Steve Nison's. There are too many uneccary words and most of the 'trading examples' are nothing more than stories (it is also not clear if those stories are fabricated or real). They do not contribute to the technical merit of the book but occupy a considerable portion of the book.

I'll keep it but do expect a revised version.

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Summary: monk
Review: The book must be the ultime "bible" for anyone interested in technical analysis and Bulkowksi made a "monk" job. I am very grateful for this book that can be used as an encyclopedia during the analysis of charts. More than any of my(many) books it is value for money!.

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Summary: Mark Twain said it best
Review: There are many flaws to this book & most of them Bulkowski admits. The first is the sample is cherry picked based on fundamentals which TB never gives out. The second is that while TB is obviously familiar with stats (he mentions the terms freq distribution & population enough that at least a passing idea of them is true) he dwells on the sample of 500 stocks over 5 years and gives us a population of X. Well that's a bit bogus as most PATTERNS take longer than a day to create (forget this hanging man thing, it's minor) so if you average out the span of a pattern creation, which is the true size of a sample not the one day of data, that he is using. Finally this books data was from only one market, a baby bull market, whether the stats quoted would hold up in a bear or a mature bull is questionable. I for sure wouldn't be able to extrapolate that based on what's given.

I'd recommend the source instead, Edwards & Magee, Technical Analysis of Stock Trends & for those interested in indicators/gann/elliott waves, Connie Browns Aerodynamic Trading.

On the plus side, it is very complete though the kook-sounding review about trendlines and support has a point; a lot of TB's work could have been done with Fib Retracement levels. Still if you are really into patterns you cannot pass it by though realize it's a starter in your analysis not a complete foundation. The 'Sample Trade' section is a real waste; there is not enough information other than pattern formation for you to do your own analysis. If you read the Identifcation section and the first summary paragraph you probably have gotten all you need out of the 46 chapters and saved yourself a lot of time.