There is a wide range of books available for learning technical analysis, covering topics like chart patterns, crowd psychology, and even trading system development. While many of these books provide outdated or irrelevant information, there are several books that have become timeless masterpieces when it comes to mastering the art of trading.
In this article, we will look at seven books on technical analysis to help traders and investors better understand the subject and employ the strategy in their own trading.
Key Takeaways
Many books in the technical trading space are outdated, but several do stand the test of time.
These classics focus on the fundamentals of technical analysis and reading charts as insight into market psychology rather than simply listing off an array of patterns.
Among the top books for learning technical analysis is Jack Schwager’s “Getting Started in Technical Analysis” and “How to Make Money in Stocks” by William O’Neil.
Getting Started in Technical Analysis by Jack Schwager
Amazon
This book is an excellent starting point for novice traders that covers every major topic in technical analysis. In addition to covering chart patterns and technical indicators, the book takes a look at how to choose entry and exit points, developing trading systems, and developing a plan for successful trading. These are all key elements to becoming a successful trader and there aren’t many books that combine all of this advice into a single book.
Technical Analysis Explained by Martin Pring
Amazon
This book is considered by many to be the “Bible” of technical analysis since it contains an exhaustive amount of information covering the core concepts. The book also covers ancillary topics like trading psychology and market mechanics that help traders understand “the why” rather than just “the how” of technical analysis. Despite the wide breadth of knowledge, the book is very approachable and easy to understand for novice traders.
Technical Analysis of the Financial Markets by John Murphy
Amazon
This book is an approachable introduction to technical analysis that still provides a high level of detail and actionable insights. As a former technical analyst for CNBC with over 40 years of experience in the market, Mr. Murphy has become a leading voice for technical analysis and is highly skilled at conveying complex topics in an easy to understand manner. Novice traders may want to check out this book before diving into more complex topics.
How to Make Money in Stocks by William O’Neil
Amazon
This book is considered a classic work on technical analysis and was written by the founder of Investor’s Business Daily, one of the most popular investment publications in the world. O’Neil was a strong advocate for technical analysis, having studied over 100 years of stock price movements in researching the book. In the book, he presents a wide range of technical strategies and tips for minimizing risk and finding entry and exit points.
Japanese Candlestick Charting Techniques by Steve Nison
Amazon
This book is the definitive volume on candlestick charting, which is one of the most commonly used technical analysis tools. Prior to Nison’s work, candlestick charting was relatively unknown in the West. He helped publicize the technique and train institutional traders and analysts at top investment banking firms. The book offers a thorough explanation of the subject, including explanations of virtually all candlestick patterns that are used by traders today.
Encyclopedia of Chart Patterns by Thomas Bulkowski
Amazon
This book is truly an encyclopedia that contains an exhaustive list of chart patterns a statistical overview of how they have performed in predicting future price movements. Mr. Bulkowski is a well-known chartist and technical analyst and his statistical analysis set the book apart from others that simply show chart patterns and how to spot them. The updated version of the book includes a section on event trading and patterns that occur with news releases.
Technical Analysis Using Multiple Timeframes by Brian Shannon
Amazon
This book has a wide appeal for technical traders because it can be helpful to traders regardless of the strategy that they use. The book highlights the value of applying technical analysis across multiple timeframes to identify trades with the highest probability of success. It also goes well beyond what its title implies and covers subjects including short selling, stop-loss order placement, price target identification, and related topics.
10,000+
There have been more than 10,000 books on technical analysis released for traders, but these seven stand out.
Agribusiness is the business sector encompassing farming and farming-related commercial activities. It involves all the steps required to send an agricultural good to market, namely production, processing, and distribution. This industry is an important component of the economy in countries with arable land since agricultural products can be exported.
Agribusiness treats the different aspects of raising agricultural products as an integrated system. Farmers raise animals and harvest fruits and vegetables with the help of sophisticated harvesting techniques, including the use of GPS to direct operations. Manufacturers develop increasingly efficient machines that can drive themselves. Processing plants determine the best way to clean and package livestock for shipping. While each subset of the industry is unlikely to interact directly with the consumer, each is focused on operating efficiently in order to keep prices reasonable.
Key Takeaways
Agribusiness is a combination of the words “agriculture” and “business” and refers to any business related to farming and farming-related commercial activities.
Agribusiness involves all the steps required to send an agricultural good to market, namely production, processing, and distribution.
Companies in the agribusiness industry encompass all aspects of food production.
Climate change has placed intensifying pressure on many companies in the agribusiness industry to successfully adapt to the large-scale shifts in weather patterns.
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Understanding Agribusiness
Market forces have a significant impact on the agribusiness sector, as do natural forces, such as changes in the earth’s climate.
Changes in consumer taste alter what products are grown and raised. For example, a shift in consumer tastes away from red meat may cause demand—and therefore prices—for beef to fall, while increased demand for produce may shift the mix of fruits and vegetables that farmers raise. Businesses unable to rapidly change in accordance with domestic demand may look to export their products abroad. If that fails, they may not be able to compete and remain in business.
Climate change has placed intensifying pressure on many companies in the agribusiness industry to remain relevant, and profitable, while adapting to the threats posed by large-scale shifts in weather patterns.
Agribusiness Challenges
Countries with farming industries face consistent pressures from global competition. Products such as wheat, corn, and soybeans tend to be similar in different locations, making them commodities. Remaining competitive requires agribusinesses to operate more efficiently, which can require investments in new technologies, new ways of fertilizing and watering crops, and new ways of connecting to the global market.
Global prices of agricultural products may change rapidly, making production planning a complicated activity. Farmers may also face a reduction in usable land as suburban and urban areas expand into their regions.
Use of New Technology
The use of new technology is vital to remain competitive in the global agribusiness sector. Farmers need to reduce crop costs and increase yield per square acre to remain competitive.
New drone technology is at the cutting edge of the industry. An article published in 2016 by the Massachusetts Institute of Technology (MIT) identified Six Ways Drones Are Revolutionizing Agriculture. These techniques, including soil and field analysis, planting, and crop monitoring, will be key to improving crop yields and moving the agribusiness sector forward.
Key areas of concern for the use of drone technology remain the safety of drone operations, privacy issues, and insurance-coverage questions.
Agribusiness Examples
Because agribusiness is a broad industry, it incorporates a wide range of different companies and operations. Agribusinesses include small family farms and food producers up to multinational conglomerates involved in the production of food on a national scale.
Some examples of agribusinesses include farm machinery producers such as Deere & Company, seed and agrichemical manufacturers such as Monsanto, food processing companies such as Archer Daniels Midland Company, as well as farmer’s cooperatives, agritourism companies, and makers of biofuels, animal feeds, and other related products.
Altcoins are generally defined as all cryptocurrencies other than Bitcoin (BTC). However, some people consider altcoins to be all crytocurrencies other than Bitcoin and Ethereum (ETH) because most cryptocurrencies are forked from one of the two. Some altcoins use different consensus mechanisms to validate transactions and open new blocks, or attempt to distinguish themselves from Bitcoin and Ethereum by providing new or additional capabilities or purposes.
Most altcoins are designed and released by developers who have a different vision or use for their tokens or cryptocurrency. Learn more about altcoins and what makes them different from Bitcoin.
Key Takeaways
The term altcoin refers to all cryptocurrencies other than Bitcoin (and for some people, Ethereum).
There are tens of thousands of altcoins on the market.
Altcoins come in several types based on what they were designed for.
The future value of altcoins is impossible to predict, but if the blockchain they were designed for continues to be used and developed, the altcoins will continue to exist.
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Understanding Altcoins
“Altcoin” is a combination of the two words “alternative” and “coin.” It is generally used to include all cryptocurrencies and tokens that are not Bitcoin. Altcoins belong to the blockchains they were explicitly designed for. Many are forks—a splitting of a blockchain that is not compatible with the original chain—from Bitcoin and Ethereum. These forks generally have more than one reason for occurring. Most of the time, a group of developers disagree with others and leave to make their own coin.
Many altcoins are used within their respective blockchains to accomplish something, such as ether, which is used in Ethereum to pay transaction fees. Some developers have created forks of Bitcoin and re-emerged as an attempt to compete with Bitcoin as a payment method, such as Bitcoin Cash.
Others fork and advertise themselves as a way to raise funds for specific projects. For example, the token Bananacoin forked from Ethereum and emerged in 2017 as a way to raise funds for a banana plantation in Laos that claimed to grow organic bananas.
Dogecoin, the popular meme coin, was apparently created as somewhat of a joke. It forked from Litecoin, which itself forked from Bitcoin in 2011. Whatever the intent behind its creation, it was still designed to be a digital payment method.
Altcoins attempt to improve upon the perceived limitations of whichever cryptocurrency and blockchain they are forked from or competing with. The first altcoin was Litecoin, forked from the Bitcoin blockchain in 2011. Litecoin uses a different proof-of-work (PoW) consensus mechanism than Bitcoin, called Scrypt (pronounced es-crypt), which is less energy-intensive and quicker than Bitcoin’s SHA-256 PoW consensus mechanism.
Ether is another altcoin. However, it did not fork from Bitcoin. It was designed by Vitalik Buterin, Dr. Gavin Wood, and a few others to support Ethereum, the world’s largest blockchain-based scalable virtual machine. Ether (ETH) is used to pay network participants for the transaction validation work their machines do.
Types of Altcoins
Altcoins come in various flavors and categories. Here’s a brief summary of some of the types of altcoins and what they are intended to be used for.
It is possible for an altcoin to fall into more than one category, such as TerraUSD, which is a stablecoin and utility token.
Payment Token
As the name implies, payment tokens are designed to be used as currency—to exchange value between parties. Bitcoin is the prime example of a payment token.
Stablecoins
Cryptocurrency trading and use have been marked by volatility since launch. Stablecoins aim to reduce this overall volatility by pegging their value to a basket of goods, such as fiat currencies, precious metals, or other cryptocurrencies. The basket is meant to act as a reserve to redeem holders if the cryptocurrency fails or faces problems. Price fluctuations for stablecoins are not meant to exceed a narrow range.
Notable stablecoins include Tether’s USDT, MakerDAO’s DAI, and the USD Coin (USDC). In March 2021, payment processing giant Visa Inc. (V) announced that it would begin settling some transactions on its network in USDC over the Ethereum blockchain, with plans to roll out further stablecoin settlement capacity later in 2021.
Security Tokens
Security tokens are tokenized assets offered on stock markets. Tokenization is the transfer of value from an asset to a token, which is then made available to investors. Any asset can be tokenized, such as real estate or stocks. For this to work, the asset must be secured and held. Otherwise, the tokens are worthless because they wouldn’t represent anything. Security tokens are regulated by the Securities and Exchange Commission because they are designed to act as securities.
In 2021, the Bitcoin wallet firm Exodus successfully completed a Securities and Exchange Commission-qualified Reg A+ token offering, allowing for $75 million shares of common stock to be converted to tokens on the Algorand blockchain. This was a historic event because it was the first digital asset security to offer equity in a United States-based issuer.
Utility Tokens
Utility tokens are used to provide services within a network. For example, they might be used to purchase services, pay network fees, or redeem rewards. Filecoin, which is used to buy storage space on a network and secure the information, is an example of a utility token.
Ether (ETH) is also a utility token. It is designed to be used in the Ethereum blockchain and virtual machine to pay for transactions. The stable coin USTerra uses utility tokens to attempt to maintain its peg to the dollar—which it lost on May 11, 2022—by minting and burning two utility tokens to create downward or upward pressure on its price.
Utility tokens can be purchased on exchanges and held, but they are meant to be used in the blockchain network to keep it functioning.
Meme Coins
As their name suggests, meme coins are inspired by a joke or a silly take on other well-known cryptocurrencies. They typically gain popularity in a short period of time, often hyped online by prominent influencers or investors attempting to exploit short-term gains.
Many refer to the sharp run-up in this type of altcoins during April and May 2021 as “meme coin season,” with hundreds of these cryptocurrencies posting enormous percentage gains based on pure speculation.
An initial coin offering (ICO) is the cryptocurrency industry’s equivalent of an initial public offering (IPO). A company looking to raise money to create a new coin, app, or service launches an ICO to raise funds.
Governance Tokens
Governance tokens allow holders certain rights within a blockchain, such as voting for changes to protocols or having a say in decisions of a decentralized autonomous organization (DAO). Because they are generally native to a private blockchain and used for blockchain purposes, they are utility tokens but have come to be accepted as a separate type because of their purpose.
Pros and Cons of Altcoins
Cons
Lower popularity and smaller market cap
Less liquid than Bitcoin
Difficult to determine use cases
Many altcoins are scams or lost developer and community interest
Pros of Altcoins Explained
Altcoins are “improved versions” of the cryptocurrency they derived from because they aim to plug perceived shortcomings.
Altcoins with more utility have a better chance of surviving because they have uses, such as Ethereum’s ether.
Investors can choose from a wide variety of altcoins that perform different functions in the crypto economy.
Cons of Altcoin Explained
Altcoins have a smaller investment market compared to Bitcoin. Bitcoin has generally hovered around 40% of the global cryptocurrency market since May of 2021.
The altcoin market is characterized by fewer investors and less activity, resulting in thin liquidity.
It is not always easy to distinguish between different altcoins and their respective use cases, making investment decisions even more complicated and confusing.
There are several “dead” altcoins that ended up sinking investor dollars.
Future of Altcoins
Discussions about the future for altcoins and cryptocurrencies have a precedent in the circumstances that led to a federally issued dollar in the 19th century. Various forms of local currencies circulated in the United States. Each had unique characteristics and was backed by a different instrument.
Local banks were also issuing currency, in some cases backed by fictitious reserves. That diversity of currencies and financial instruments parallels the current situation in altcoin markets. There are thousands of altcoins available in the markets today, each one claiming to serve a different purpose and market.
The current state of affairs in the altcoin markets is unlikely to consolidate into a single cryptocurrency. But it is also likely that a majority of the thousands of altcoins listed in crypto markets will not survive. The altcoin market will likely coalesce around a bunch of altcoins—those with strong utility, use cases, and a solid blockchain purpose—which will dominate the markets.
If you’re looking to diversify within the cryptocurrency market, altcoins can be less expensive than Bitcoin. However, the cryptocurrency market, regardless of the type of coin, is young and volatile. Cryptocurrency is still finding its role in the global economy, so it’s best to approach all cryptocurrencies cautiously.
What Is the Best Altcoin to Invest in?
The best altcoin to invest in depends on your financial situation, goals, risk tolerance, and the market’s circumstances. It’s best to speak to a financial advisor to help you decide which one is best for you.
What Are the Top 3 Altcoins?
By market cpacity, the top three altcoins are Ethereum, USD Coin, Tether (USDT).
Is It Better to Invest in Bitcoin or Altcoins?
Which cryptocurrency is better is a subjective argument based on an investor’s financial circumstances, investing goals, risk tolerance, and beliefs. You should talk to a professional financial advisor about investing in cryptocurrency before buying any.
Investing in cryptocurrencies and other Initial Coin Offerings (“ICOs”) is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or other ICOs. Since each individual’s situation is unique, a qualified professional should always be consulted before making any financial decisions.
Accepting risk, or risk acceptance, occurs when a business or individual acknowledges that the potential loss from a risk is not great enough to warrant spending money to avoid it. Also known as “risk retention,” it is an aspect of risk management commonly found in the business or investment fields.
Risk acceptance posits that infrequent and small risks—ones that do not have the ability to be catastrophic or otherwise too expensive—are worth accepting with the acknowledgment that any problems will be dealt with if and when they arise. Such a trade-off is a valuable tool in the process of prioritization and budgeting.
Key Takeaways
Accepting risk, or risk retention, is a conscious strategy of acknowledging the possibility for small or infrequent risks without taking steps to hedge, insure, or avoid those risks.
The rationale behind risk acceptance is that the costs to mitigate or avoid risks are too great to justify given the small probabilities of a hazard, or the small estimated impact it may have.
Self-insurance is a form of risk acceptance. Insurance, on the other hand, transfers risk to a third-party.
Accepting Risk Explained
Many businesses use risk management techniques to identify, assess and prioritize risks for the purpose of minimizing, monitoring, and controlling said risks. Most businesses and risk management personnel will find that they have greater and more numerous risks than they can manage, mitigate, or avoid given the resources they are allocated. As such, businesses must find a balance between the potential costs of an issue resulting from a known risk and the expense involved in avoiding or otherwise dealing with it. Types of risks include uncertainty in financial markets, project failures, legal liabilities, credit risk, accidents, natural causes and disasters, and overly aggressive competition.
Accepting risk can be seen as a form of self-insurance. Any and all risks that are not accepted, transferred or avoided are said to be “retained.” Most examples of a business accepting a risk involve risks that are relatively small. But sometimes entities may accept a risk that would be so catastrophic that insuring against it is not feasible due to cost. In addition, any potential losses from a risk not covered by insurance or over the insured amount is an example of accepting risk.
Some Alternatives to Accepting Risk
In addition to accepting risk, there are a few ways to approach and treat risk in risk management. They include:
Avoidance: This entails changing plans to eliminate a risk. This strategy is good for risks that could potentially have a significant impact on a business or project.
Transfer: Applicable to projects with multiple parties. Not frequently used. Often includes insurance. Also known as “risk sharing,” insurance policies effectively shift risk from the insured to the insurer.
Mitigation: Limiting the impact of a risk so that if a problem occurs it will be easier to fix. This is the most common. Also known as “optimizing risk” or “reduction,” hedging strategies are common forms of risk mitigation.
Exploitation: Some risks are good, such as if a product is so popular there are not enough staff to keep up with sales. In such a case, the risk can be exploited by adding more sales staff.
