Reversal and Retracement: Meet H.M. Gartley
One of the most powerful patterns in the financial markets is the Gartley pattern. Before we define the pattern itself, we must give credit where credit is due and discuss the man himself, H.M. Gartley.
Harold Gartley was born in Newark, New Jersey in 1899. Gartley received his Bachelor’s Degree in Commercial Science and a Master’s Degree in Business Administration from New York University. Over the years he worked on Wall Street as a board boy, runner, broker, analyst, financial advisor and educator. He traveled to give lectures on the subject of technical analysis and privately taught many prominent Wall Street traders at the time.
Gartley’s technical analysis course eventually turned into a three-ring binder that was published in 1935 and was entitled “Profits in the Stock Market.” Less than 1000 copies were originally sold. However the selling price of the course was high at the time. Gartley’s course was selling for $1500 in 1935, or the equivalent of three Ford cars! It’s amazing to think that he could sell ANY of these courses at such a steep price in the middle of the Great Depression in the United States.
Gartley wrote many articles about the stock market but “Profits in the Stock Market” is considered to be his best work. The original book has become a technical analysis classic and a collector’s item. “Profits in the Stock Market” covers a wide array of subjects including trends, Dow Theory, Triangles, Moving Averages, and Gaps. It is said that Gartley has done more work on the subject of volume analysis in the stock market than anyone else. He covers a number of different patterns in the book, but he spends more time on one pattern than he does all the other patterns. This particular pattern is discussed in detail on page 222 and today is referred to as the Gartley pattern.
Gartley was one of the founders of the New York Society of Security Analysts and from 1947 until his retirement in 1969, he worked in the field of financial public relations. Harold M. Gartley passed away in 1972 at the age of 73.
In 1979, Billy Jones from the Lambert-Gann Publishing Co. purchased the copyrights from Mrs. Gartley and started publishing “Profits in the Stock Market” as a hardbound 446 page book. In 1981, the Market Technicians Association gave its annual award posthumously to H.M. Gartley for his contribution to technical analysis. In the 1990’s, as many of “Profits in the Stock Market” copies were gathering dust, Larry Pesavento blew the dust off of his copy and decided it was time to re-introduce the world to H.M. Gartley. Larry coined the term “Gartley 222” from the page number in the book where the pattern appears and started to apply Fibonacci ratios to the Gartley to increase the accuracy of this classic pattern.
Ross Beck, FCSI (AKA Mr. Gartley) is a Fellow of the Canadian Securities Institute and world renowned public speaker on technical analysis. Ross writes The Climb newsletter for Majestic Peak Trading and the Gartley Trader newsletter at gartleytrader.com. Click here for more information.