Trend Following: How Great Traders Make Millions in Up or Down Markets, New Expanded Edition [Kindle Edition]

Great piece of background reading, good for the beginner trying to work out what type of trading strategy to use. Trend Following appears to be the most profitable type of technical analysis strategies and Covel does go into the whys and wherefores of how they work. Though if you're interested in system development, strategies etc go for any of Van tharps, William ONeil, Martin Zweig and Vic Sperandeo books.

If you're interested in background reading I also recommend the Reminiscences Of a Stock Operator, Market Wizards and New Market Wizards. Trade Well!

It took a fair amount of effort to wade through the large amount of baloney, hype and hero-worship which this book contains. For example, what is a chapter about baseball doing in a book about trading strategies? However, there are definitely nuggets of useful information in this book, and the appendices at the end contain some actual recipes for trading strategies with some backtest results.
Ultimately Covel succeeds in what he is trying to do, which is to popularise the idea of trend-following. The idea is that you only enter a market when there is a trend (as defined by a breakout signal, of which there are many to choose from) and then ride the trend as long as possible. He gives examples of successful funds which manage money using these techniques (although the performance charts showing compounded returns don't always look quite as good when inspected carefully), so it seems it can be done. The book also shows that the discipline of risk-management and sticking to your knitting are more important than the source of the signals themselves.
Nor does Covel shy away from explaining that large losses (or 'drawdowns' as he prefers to call them) are possible. In fact in trendless markets a trend-following system is almost guaranteed to lose money as it buys high and sells low on 'false signals'.
In sum, a decent introduction to trend following. Pedants like me will be annoyed by some of the grammatical and spelling errors and there are a few inconsistencies too. One thing that really needs to be protested is the implication that anyone involved in financial markets who is not trend-following must be a fool. Buy-and-hold is derided, the example of Warren Buffett being refuted by the odd arguments that 1) he is just one man and 2) he also uses derivatives.
Let's imagine what the world would be like if everyone bought and sold like a trend-follower. First of all, there wouldn't initially be any market movement because everyone would be waiting for a signal. Then, if there was a change in price, every trend-follower would immediately chase it in the same direction to either zero or infinity. In fact there would be no market because if everyone was a trend-follower then there would be no-one willing to take the other side of the trend-followers' trades. To say it a slightly different way, with no notion of fundamental value, prices can get to silly levels (imagine bonds trading higher than the sum of their cashflows for example). In fact, the only reason trend-following has a chance of working is because of the existence of natural buyers and sellers (ie 'non-traders') who have business reasons for transactions, as well as value investors and arbitrageurs. Trend followers hope that these market participants are 'greater fools', and this may well be true while there are not a huge number of trend followers in the market.
Which brings me onto the final point- beware of becoming a trend-follower just as a successful book about trend-following is popularising the idea. It is clear that with a greater proportion of trend-followers in the market, the returns will be less (since trading is a zero-sum game as Covel repeatedly points out, if everyone was a trend-follower then for every winner there must be a loser).
I understand that Covel is already working on a book called 'Swing Trading: How to make money in sideways markets'

If you are serious about creating a trend following method then don't buy this book. The text demonstrates that Covel is a salesman, not a trader. His business model is based on making money by selling the idea of trend following. He is not trading with trend following himself -- rather writing hagiographies about trend followers without revealing any details -- giving generalized statements instead... The content is simplistic and basically garnered from other books on trading (e.g. Market Wizards). Note his annoying and frequent self-marketing references to his websites. After reading this you will be equipped to talk about trend following at dinner parties, but that's about it...

I recommend Perry Kaufman's books if you are a serious student attempting to create a trading system.