Stock charts

What this book actually teaches

Greg Schnell and Lita Epstein's book makes the case that technical chart reading is a learnable skill with practical applications for individual investors — not a form of voodoo for traders but a systematic way to read market sentiment, identify trend direction, and time entries and exits in a manner that improves on random decision-making. The For Dummies format imposes accessibility: the book is deliberately non-intimidating, starts from first principles, and avoids the assumption of prior technical analysis knowledge. Schnell's background as a chartered market technician and StockCharts.com analyst gives the content credibility beyond the typical introductory treatment.

The book opens with the basics of how stock charts work — price bars, candlesticks, volume, time scales — before building into the pattern recognition and indicator frameworks that form the core of technical analysis. Schnell covers trend lines, support and resistance levels, moving averages, and momentum oscillators (RSI, MACD, Stochastics) with enough specificity to let a reader set up and interpret these tools on a real chart. The treatment of moving averages is particularly useful: Schnell explains not just what they are but how to use multiple moving average lengths as a trend-confirmation system rather than relying on any single average in isolation.

The relative strength and intermarket analysis sections are where Schnell's particular expertise shows. He introduces the concept of comparing a stock's or sector's performance against a benchmark to identify leadership versus laggard behavior — a framework that goes beyond simple price trend analysis to ask whether this security is worth owning relative to its alternatives. The breadth indicators (advance/decline line, new highs/new lows) are presented as gauges of overall market health that individual stock analysis alone cannot provide.

The weaknesses are inherent to both the format and the subject matter. The For Dummies format prioritizes accessibility over depth; readers who want a serious technical education will quickly outgrow this book and need to move to more rigorous sources (Pring, Murphy, or Brooks for more advanced treatments). The book also cannot resolve the fundamental debate about technical analysis — whether chart-based trading systematically produces risk-adjusted outperformance after transaction costs — and does not try to. Readers should approach the methodology as a useful organizational framework for thinking about price trends rather than as a proven alpha-generation system.

For individual investors who want to add a basic charting capability to their analytical toolkit — to improve the timing of entries and exits on investment ideas they have developed through fundamental analysis — this book provides a practical starting point. Not a system for stock selection on its own.

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About Greg Schnell

Read more from Greg Schnell and explore the full bibliography on ClearValue Books.