Trading and Investing in the Forex Market Using Chart Techniques

by Gareth Burgess

Quick Summary

This Wiley Trading book provides a comprehensive visual guide to forex market chart analysis, covering Japanese candlestick signals (single and double candle patterns), continuation and reversal chart patterns, technical indicators, Fibonacci analysis, Elliott Wave theory, and practical trade management. The book includes chart analysis exercises with answers throughout, making it a hands-on workbook for forex traders who rely on price action and chart pattern recognition.

Detailed Summary

Gareth Burgess's "Trading and Investing in the Forex Market Using Chart Techniques" is a practical, visually oriented guide to applying classical technical analysis methods to currency markets. The book is organized around increasingly sophisticated chart analysis techniques, with exercises at the end of each chapter.

Chapter 1 provides extensive coverage of Japanese candlestick signals. The single-candle patterns section covers doji variants (standard, dragonfly, gravestone, long-legged), hammers, hanging men, spinning tops, marubozu (full and opening/closing variants), and shooting stars. The double-candle signals section covers engulfing patterns (bullish and bearish), harami, piercing lines, dark cloud covers, tweezer tops and bottoms, and morning/evening stars. Each pattern is defined with precise criteria and illustrated with chart examples.

Chapter 2 catalogs chart patterns divided into continuation patterns (bull/bear flags, pennants, symmetrical triangles, falling/rising wedges, head-and-shoulders continuations) and reversal patterns (head-and-shoulders reversals, triple tops/bottoms, double tops/bottoms, V-tops/bottoms, broadening formations). For each pattern, Burgess provides entry criteria, target calculation methods, and stop placement guidelines.

Subsequent chapters cover technical indicators including moving averages (simple, exponential, weighted), MACD, RSI, stochastic oscillator, Bollinger Bands, and ADX/DMI for trend strength measurement. Fibonacci analysis is presented in detail, covering retracements, extensions, projections, and fan lines applied to forex pairs. Elliott Wave theory receives a dedicated chapter explaining impulse and corrective wave structures and their practical application to forex trading.

The book also addresses trade management topics including position sizing, risk-reward ratios, stop-loss placement techniques, and the importance of maintaining a trading journal. The forex-specific context means that all examples use currency pairs and address forex-specific considerations such as pip values, lot sizes, session overlaps, and the impact of economic data releases on currency volatility.

The inclusion of chart analysis exercises with answers at the end of each chapter makes this book particularly useful as a self-study workbook. The exercises require readers to identify patterns, determine trade direction, calculate targets, and place stops on unmarked charts before checking their answers against the provided solutions.