The Trader’s Bible: Why John J. Murphy’s “Technical Analysis of the Financial Markets” Still Rules the Charts
Pauses in an existing trend before the asset resumes its original direction, including Triangles (symmetrical, ascending, descending), Flags, Pennants, and Wedges. 5. Volume and Open Interest The Trader’s Bible: Why John J
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Signal that an existing trend is about to change direction (e.g., Head and Shoulders, Double Tops, and Double Bottoms). Head and Shoulders
Murphy establishes three primary tenets that form the foundation of his methodology: Market action discounts everything:
This section details the actual "signals" on a chart.
Every fundamental factor—earnings, politics, psychology—is already reflected in the asset's price.