I hated reading when I was younger.
I didn’t have the attention span, and I definitely didn’t have the interest to make it through an entire book, let alone a chapter.
All I wanted to do was play baseball. That was my focus. The only reason I kept my grades up was because I knew if I didn’t, my parents would take baseball away. That was more than enough motivation.
It wasn’t until after college that things started to change. I finally found something that truly grabbed my attention. Once that happened, I started reading constantly.
At first, I read what the older guys told me I had to read. This was the early 2000s, and there was a standard list of classics everyone passed around. Books like “Beating the Street,” “Confessions of a Street Addict,” “Liar’s Poker,” and “The Predator’s Ball.”
“Reminiscences of a Stock Operator” was the first book I read that was specifically about trading. I loved it, but I still hadn’t quite figured out how any of this actually worked.
By 2005, I had gone through most of those books, reading them on buses and trains during my daily commute from Hoboken into New York City.
And then something happened that changed everything.
I was introduced to technical analysis.
The Books That Changed My Life
I get asked all the time which books I recommend for people who want to better understand how I look at markets.
It’s something I think about often.
But I’ll tell you this up front. The best teacher over my 23-year career hasn’t been books. It’s been the daily work. Observing markets. Studying price. Participating through full cycles, over and over again.
You don’t build strong muscles by reading books about pushups. You build them by actually doing the pushups.
Markets work the same way.
That said, there was a very specific moment when everything started to come together for me.
It was 2005. I was heading back to Hoboken after a long day working in Midtown Manhattan. I remember it clearly because I was sitting on a bus, finishing chapter three or four of John Murphy’s first book, “Technical Analysis of Financial Markets.”
And that’s when it hit me.
I get this.
This makes sense.
This is for me.
That was the moment technical analysis officially entered my life.
Before that day, I barely even knew what technical analysis was. I had seen a few snippets in Investor’s Business Daily, which I read during my commute each morning, but that was the extent of my exposure to studying price behavior.
I hadn’t even scratched the surface of the human behavior side yet. That came later.
But this was the book that changed everything:
It even came with a study guide, complete with questions at the end of each chapter. I can’t think of a single book I’d rather hand to my younger self.
I’m not sure I would have appreciated it the same way if I’d read it earlier. By then, I’d already worked through the other books I mentioned before, the so-called classics recommended by my elders at the time.
After Murphy, I moved on to Edwards and Magee.
This one is heavy. I’m glad I read the John Murphy book first because it’s far more approachable and covers a tremendous amount of ground.
“Technical Analysis of Stock Trends” by Robert D. Edwards and John Magee is widely considered the Bible of technical analysis. It’s essentially the Murphy book on steroids, and it was originally published in 1948.
There are newer editions now, but this is the one I read:
It’s not an easy one. But you have to read it.
And when you’re done, you should read it again.
CMT Curriculum in 2005
The point of this post is not to give you a simple reading list.
It’s to help you understand which books shaped the way I look at markets, when I read them, and why they mattered at that specific time in my life.
With that context, you can decide for yourself which books to read and in what order. All I can do is tell you how I did it, for better or worse.
At the time, I was in the early stages of working through the three levels of the CMT exams to earn the CMT designation from the Market Technicians Association, now known as the CMT Association.
There was no formal curriculum back then, like there is today. No videos. No structured coursework. They simply handed us a list of books and told us which chapters to focus on. That was it. True story.
And, honestly, I’m glad it worked that way.
It forced me to work through some incredibly important books at a very formative time in my life. I was 23, 24 years old, and this was exactly what I needed to be doing.
At that point, everything felt clear. I liked technical analysis. It made sense to me. This was for me. I could see myself doing this for the rest of my life.
Now I’m about to turn 44, and I can confidently say I was right.
Understanding Human Behavior
“Investment Psychology Explained” by Martin Pring was the first book I read that focused on the human side of trading and investing.
Up until then, my world was all about price, momentum, and identifying trends. Then I read this book:
That was the beginning of my journey into behavioral finance. It was when I first realized that asset prices move not because of spreadsheets or models, but because humans act irrationally.
Since then, I’ve read dozens of books on psychology, human behavior, and how those forces impact markets.
A few that have stood out for me are “Thinking in Bets” by Annie Duke, “Sapiens” by Yuval Noah Harari, and just about anything ever written by Dr. Brett Steenbarger.
There are many more, but we will leave it there for now.
My Introduction to Intermarket Analysis
The final piece that tied everything together for me was “Intermarket Analysis” by John Murphy.
This guy wrote two books that changed my life in completely different ways. One introduced me to technical analysis. The other taught me how the world actually works.
This book turned me into a global macro intermarket analyst:
Not the angry, bitter macro permabears you see yelling on Twitter every day. The useful kind. The kind that follows price, watches relationships, and lets markets do the talking.
This was the moment I truly understood that stocks do not move in isolation.
Other assets matter. They influence direction, confirm trends, and behave differently depending on the environment. That realization changed everything.
Bonds. Stocks. Commodities. Three asset classes.
That was the first time it fully clicked for me. My cheat code back then – true story – was the old Bear Stearns ticker symbol: BSC. Three letters. Three asset classes.
Kids today don’t have that ticker, and many of them forget about the third asset class altogether. Commodities still matter.
Currencies matter, too. The foreign exchange markets play a major role in driving all three asset classes. And now, of course, we even have crypto markets to analyze and trade.
But for me, it all started right here with John Murphy’s “Intermarket Analysis.” I read it while preparing for the CMT Level II exam in 2006.
I finally completed the CMT program at 26 years old and earned the designation that still sits after my name today.
It’s a great organization, and I recommend the program to anyone serious about learning technical analysis the right way.
Over the years, I’ve traveled all over the world speaking to CMT chapters across Europe, Asia, and North America. London. Amsterdam. Dublin. Athens. Singapore. Manila. Taipei. Kuala Lumpur. Hong Kong. Vancouver. Toronto. New York. Miami. San Francisco. Chicago. Dallas. Austin. Houston. Charlotte. And many more.
I’ve met CMTs in all of these places. I’ve spoken to their chapters. And I can tell you with confidence that there is no community like this one.
I’ll follow up soon with the next set of books and how they continued to shape my career and my life.
Because here is the truth.
Passing the CMT exams isn’t the finish line. It’s the starting point.
Reading these books gives you the body of knowledge. That part is invaluable.
But once you earn the designation, and/or get through all of these books, that’s when the real work begins.
To be continued…
This Week in Everybody’s Wrong
On Monday, we looked at energy stocks and why nobody likes them.
But one of the most important energy stocks in the world is hitting new highs.
And that’s worth paying attention to…
On Tuesday, we broke down the dumbest “smart” critique in finance.
“The problem with technical analysis is that it only looks at information from the past.”
lol… All market analysis looks at the past, and if future data existed everyone would use it.
On Wednesday, we paid proper respect to the Jan Bradys of the world.
Mid-cap stocks are breaking out to new highs, too,
That’s not just another headline. It’s a signal.
On Thursday, we turned it over to Sam Gatlin for a closer look at a particular industry within a specific sector.
After years of going nowhere, health care is finally breaking out.
And biotech mispositioning represents a big opportunity.
On Friday, we celebrated small-cap stocks making new all-time highs.
This is not a narrow market, nor is it fragile.
And it certainly isn’t being driven by just a handful of names.
On Saturday, Quantitative Analyst Grant Hawkridge took time out of his Australian summer to bring us more great data.
The first month of a new year is a good time to see whether investors are willing to put money to work after a holiday reset.
That’s where the January Barometer comes in.
Have a great Sunday.
We’ll see you Monday morning…
Stay sharp,
JC Parets, CMT
Founder, TrendLabs