Thoughts on Al Brooks Price Action Trading

If you’ve read some of my earlier blog posts, you might have come across references to Al Brooks.  Actually WordPress tells me virtually no one reads this blog, but I’m trying to be positive.

A few months ago, I bought Brooks’ book on Trading Price Action Trends ($50 at Amazon).  It was a big, dense book, full of charts and graduate-level writing.  Nevertheless I thought it had some good points on price action.  The trading style suits an aspiring day trader like me.  I started looking into the trading course, which is $250 at Brooks’ website.

The one thing that made me hesitant was the absence of any trading record.  It’s unusual for a trading vendor to be so tight-lipped about results.  But on his website he explained that he makes no representations and no trading calls to avoid regulatory issues.  I checked around, and it seems he’s consistent about this.  I also saw positive comments about his price action style on the Elite Trader forum.  Since I liked what I had seen in the book, I decided to buy his video course.

The $300 I spent on the course and the book is pretty trivial to me.  But my time is precious.  I can’t afford to waste my time learning trading systems that don’t work.  The Brooks course is about 30+ hours of videos, delivered in monotone by a narcoleptic teetering on the brink of sleep.  It’s a serious investment of time and focus.  But I think it’s good stuff.  I’ve switched to trading Eminis almost exclusively, and except for two unfortunate days last week, I’ve been having pretty decent results, given I’m still a rookie.

About two weeks ago, I saw that Emmett Moore at TradingSchools.org had posted a review of Al Brooks, and it was not a positive review.  It was full of phrases like “mumbo-jumbo … Pure magical thinking … trying to fit you with a custom butt plug … weird, highly indigestible, utterly confusing … pretzel logic … circle jerk, waste-of-time carnival attraction”.   Harsh stuff.

The main reason for the negative review was the absence of a verifiable trading record.  This is a completely valid point.

Brooks apparently consulted an attorney who advised against disclosing actual trading results or calling out trades in his live chat room.  Given my professional background, I can appreciate a cautious approach.  You don’t want to screw around with securities regulators.  Yet I can’t help but think of the many ways Brooks could provide some comfort to potential customers getting himself in legal jeopardy.

One way would be to show brokerage statements privately and directly to Moore, and let Moore confirm to his readership that Brooks is really trading, and trading successfully, without disclosing details that might amount to representations to customers.  Moore has done this with other traders over Skype, and it doesn’t seem to create any regulatory issues.

However Brooks does not do this.  Which gives Moore an opportunity to offer a plausible alternate storyline:  Brooks is not a successful trader.  He makes his money from selling educational material and trading room subscriptions.  And he the lawyer’s advice as cover to keep his poor or non-existent trading record secret.

Had I read Moore’s review a few months earlier, I would have accepted the storyline and not bought the course.  Moore has a lot of credibility with me.  He was completely on-target in trashing Warrior Trading (based on my own bad experiences with them).  He also made a great call in recommending Kevin Kleinman’s WatchHimTrade live trading room.  I say that as a subscriber.  And I’ve watched in bemusement as poorly reviewed vendors subsequently became targets of law enforcement.

However I have some experience with Brooks’ material, and because of that my view of Brooks differs from Moore’s.  I would give Brooks a qualified recommendation.  To further explain:

  • Brooks has put in an enormous amount of time and effort to document his trading system. The effort is obvious.  I’ve read through one of his books and skimmed through the other two.   These books are not something that can be hashed out in a few days or easily plagiarized.  The material makes sense and comprises a logical trading approach.
  • Brooks uses a lot of jargon to describe what he is doing.  The live trading room is probably gibberish to someone who hasn’t gone through the course and picked up the jargon.
  • Moore lists several quotes taken from Brooks during his live trading sessions.  They don’t sound like the sort of things he would say, based on his writing.  But they are close.  This makes me think there may have been a translation or transcription issue.
  • While Brooks does not disclose a trading record, he posts his bar-by-bar analysis of the Emini each day on his website.  I follow these posts closely to compare his reading of the Emini charts to my own.  From what I’ve seen, I think he makes a lot of good calls.  More good calls than bad.
  • By “calls” I mean suggestions.  Brooks will never say “buy at price X and sell at price Y”.  That isn’t his style.  His trading approach revolves around probabilities.  As an example, on Friday when the ES was near the LOD, he wrote:

“35 HL(higher low) MTR(major trend reversal), good B(buy or long) SB(sellers below or probably sellers at the low of the bar), ok swing B(buy or long) for test above 11 L(low), but AIS(always in short), TTR(tight trading range) and 60MA(60 minute 20 bar exponential moving average) TGTB(target below) so more likely SW(sideways).”

  • My translation of the code above is that Brooks suggests to buy at bar 35 because the chart is showing a reversal setup, but because of an earlier downtrend, there is  also a high probability that the price will go sideways for a bit.  Had I been in the live trading room, I would have bought based on this suggestion, and 2 hours later I would have made 5-6 points.
  • As a caveat, I don’t subscribe to Brooks’ live trading room.  If I find that his bar-by-bar analysis is not made in real time, I will retract everything positive that I’ve said about him.

I think Moore does great work at TradingSchools.org.  I don’t want him to stop.  At times I think he writes scathing reviews to encourage vendors to disclose trading results.  I recall at least one instances where a bad review was changed because a vendor came forward with his trading results.  I sincerely hope Brooks responds in a similar manner so that Moore’s review can be updated.

The bottom line is that I’ve looked closely at Brooks’ price action approach.  It comes with a steep learning curve, but the results I’m seeing with Eminis is positive.  Actually it’s really positive, if you exclude those two awful days last week.  I’m continuing to work on price action trading, and the second I suspect it doesn’t work or that Brooks is in fact a charlatan, I will say so here on my blog.  But my experience so far has been positive.

 

 

 

 

3 thoughts on “Thoughts on Al Brooks Price Action Trading

  1. I have a friend who has followed Al Brooks for several years and bought all his books. In addition he has attended his chat-room.
    My friend has failed to make any money after 4 years of intense study.

    I know he is intelligent and hardworking and his study of Brooks would have been careful and detailed.

    I asked him about Brooks performance and he said he only trades one contract to avoid emotion. That is hogwash.
    Then my friend said he publishes his bar-by-bar at the end of the day, about 5 min after the close, so he didn’t see how it can be faked. That too is sillyness. I know from experience I can easily type in notes as I trade and the edit out bad bits as I go along so it is ready at the end of a trading day.
    The bit about not publishing results is pure hogwash. There are no rules against publishing them. Also there are 3 party firms which will track all your trades live and publish the performance – all third party, so once again hogwash.

    I read your example which starts with:
    “35 HL(higher low) MTR(major trend reversal), good B(buy or long) SB(sellers below or probably sellers at the low of the bar),
    If the trade went down then sellers below or probably sellers at the low of the bar – would be pointed out as that is what he said.

    Trading needs clarity and any gibblegook that can later be interpreted 6 ways to Sunday is useless.

    I have nothing against and “educator” selling his wares.
    My problem is the destruction of the lives of traders who bank on this.

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  2. Thanks for your comment. Since I wrote this post, my view of Al Brooks has soured. I no longer pay much attention to him. He’s obviously done a lot of work to develop his course, write his books, and operate his live trading room. But in the end I won’t trust anyone who doesn’t disclose his trading results, or at least make real trading calls rather than the equivocal nonsense I heard during the month I was in his trading room.

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