Learn and Become  a Better Trader

“The more that you read, the more things you will know. The more that you learn, the more places you’ll go.”

Here are our recommendation on books that may change your trading style and could help you achieve your dreams.

 

 

COME INTO MY TRADING ROOM: A COMPLETE GUIDE TO TRADING

by Alexander Elder

This is the book that convinced me that I need to start thinking seriously about trading. Elders classic book is one of the many trading books I  have read and is still my favorite. I strongly recommend it all the times to other interested people as a great introduction to trading.

The book is very clearly written as a broad introduction to trading and a hands-on-guide to teaching yourself how to be a successful trader. In this book Dr. Elder covers the three important aspects of success:
Mind – Mastering your own mind is at the core of being successful in anything. Here he discusses the psychology of trading – how close it can come to gambling and how to avoid that.
Method – Your actions must be correct to achieve success. Dr. Elder shows how to apply the concept of mastering your mind to an actual trading system.
Money – Trading is a risky enterprise. “Managing risk” is another term for “trading profitably.” – provided you own your ‘mind,’ and you’ve chosen a working ‘method.’

One of the interesting concepts that I have learn from this book is ‘ Triple Screen’ – Elder explains the importance of using multiple time frames, though he believes that two or maximum three time frames should be enough. The key idea is that whatever time frame you use, you need to check the next longer time frame for confirmation. So the lesson is to always verify the bigger picture and then you can return to the shorter time frame and make more tactical decisions having the broader trend in mind.

The book can be complemented by the Study Guide for Come into my Trading Room – this will test and challenge your understanding of the important areas of trading. You have to answer the question related to money management, record keeping and managing the time, test your knowledge of charting and be prepared to examine few case studies.

 

THE DISCIPLINE TRADER: DEVELOPING WINNING ATTITUDES

by Mark Douglas

One of the best trading books ever is Mark Douglas’s book “The  Discipline Trader: Developing Winning Attitudes”. This is a book  was a mind opener for me as it was the first book that covered both psychology and trading. In fact i have learned later that this is one of the first books ever written to address the psychological nature of how successful traders think .  In this groundbreaking work published in 1990, Douglas examines the causes as to why most traders cannot raise and keep their equity on a consistent basis and brings the reader to practical and unique conclusions as to how to go about changing any limiting mindset.

At first, the book may be hard to understand, especially for traders that are not too familiar with psychology. One of the biggest mistakes of beginner traders is that they concentrate their efforts on learning the technical aspects of trading and disregards the psychological aspect. Greed and fear have been for long the worst trading enemies for new and inexperienced traders.

The trader is taken through a step-by-step process to break through those queries and begin to understand that their very thoughts may be limiting their ability to accumulate and succeed at trading.  Reading Douglas’s lessons will definitely help you fighting the  negative psychological aspects of trading and become a better trader.

If you are interested reading Mark Douglas’s books I suggest to  start reading this book first and continue with his other great one: Trading in the Zone.

 

TRADING IN THE ZONE: MASTER THE MARKET WITH CONFIDENCE, DISCIPLINE AND A WINNING ATTITUDE 

by Mark Douglas

Every time I have an opportunity to make a gift to someone who has got an interest in trading (any financial market and at any level) I go to the nearest bookshop or Amazon and buy this book !

I think that any trader at any level or trading any market should read this book. It is about you and the market; is about how to set up your mind to become a consistent winner, it is about the hardest challenge to conquer: yourself.

If you are like most people, after your first few losing trades you set about to learn better market analysis, charting, systems, indicators and what not. Eventually you’ve learned about risk and money management. But there are very few traders and books that will talk about mindset and this in one of them.

For new and inexperienced traders: this book may or may not make a lot of sense. However, as you are becoming more experienced and spend way more time trading, the concepts of this book and the so called “Zone” will start to be easy to relate to and you will start to appreciate the insights of this book.

Needless to say that the book will not make you a successful trader overnight – every trader needs to find his/hers way to the level of ‘trading in the zone’. Take the principles for Douglas book, apply them to your style of trading. Stay disciplined, focus and don’t try to anticipate the market.

 

 TRADING FOR A LIVING: PSYCHOLOGY, TRADING TACTICS, MONEY MANAGEMENT

by Alexander Elder

Another classic book that I highly recommend in particular to new traders or people contemplating  trading but have not yet made the decision to start. You can trade stocks, options, futures or anything – the rules of the book are the same.

I must confess that I am an admirer of Elder’s books as he is combining his previous experience and training as a psychologist with his experience as a trader. This book, same as his other books, is simple and easy to read and covers pretty much everything related to trading, at a detailed enough level. It’s focus is on the three basic concepts: psychology, technical analysis and risk management. 

Trading for a Living  is based on three M’s: Mind, Method, and Money. Trading for a Living helps you master all of those three areas:  How to become a cool, calm, and collected trader;  How to profit from reading the behavior of the market crowd; How to use a computer to find good trades ;  How to develop a powerful trading system; How to find the trades with the best odds of success; How to find entry and exit points, set stops, and take profits .

Trading for a Living helps you discipline your Mind, shows you the Methods for trading the markets, and shows you how to manage Money in your trading accounts so that no string of losses can kick you out of the game.

As a suggestion: try reading this book a second time after few months. Dr Elder also have a study guide that follow New Trading for a Living which a highly recommend to reinforce the concepts that he taught.

 

 FOREX FOR BEGINNERS

by Anna Coulling

Forex For Beginners is the prequel to author’s first two books, A Three Dimensional Approach to Forex Trading, and A Complete Guide to Volume Price Analysis.  It has been written to lay the foundations and provide the framework for getting started in the world of Forex, in what I believe is the correct way.

The book explains everything, from the pure mechanics to the trading methodology.

 

FOREX PRICE ACTION SCALPING: AN IN-DEPTH LOOK INTO THE FIELD OF PROFESSIONAL SCALPING

by Bob Volman

Forex Price Action Scalping is a highly recommended book as it provides a unique look into the field of professional scalping. Packed with countless charts, this extensive guide on intraday tactics takes the reader straight into the heart of short-term speculation. The book is written to accommodate all aspiring traders who aim to go professional and who want to prepare themselves as thoroughly as possible for the task ahead.

This book  will definitely help you learning price action trading and it can be a useful building block for you to develop your own trading approach.