Day Trading With Short Term Price Patterns and Opening Range Breakout by Toby Crabel

Summary: The first trading book that gives price data the proper rigorous treatment. Statistics and biases are summarized across several markets. The framework that Mr. Crabel developed back then 20+ years ago is still valid today. Great insights that shaped the trading principles of many famous traders nowadays. One of the best trading classics of all time.

Review

Published more than 20 years ago, this book was the first book on trading that applied rigorous statistic studies on the historical data across several markets (bonds, beans, cattle, S&P, currencies). The writing is concise and to the point. Charts are provided whenever necessary to illustrate the concepts described.

The book is divided into two main parts.

First, the observations on statistical behaviours of opening range breakout, short term price patterns, and contraction/expansion are presented separately. Each concept is clearly explained together with tables of statistics backing his interpretation. Systematic trading results based on simple entry rules are also included.

In second part of the book, Mr. Crabel looks into combinations of the concepts presented in the first part to illustrate how useful this can be. Clear rules and guidelines are provided with statistics and trading performance backing the points he made.

Last section of the book deals with patterns that fall outside of the main concepts presented in the book. For example, bull hook and bear hook are cleanly defined with statistics on their historical behaviour.

This book is one of my all time favourite trading books. Highly recommended to anyone interested in trading the stress free way.

p.s. This book is no longer in print thus the price can get very expensive since it can be found from places that sell antique / out-of-print books only. If you find a copy at a local library, borrow it instead.

p.p.s. The picture used in this review is taken from the copy I have.

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