Forex Book

Trading in the Zone is a trading book dedicated to the psychological training of a trader. According its author, Mark Douglas, trader’s mindset should be significantly different than a common real-life mindset. The greatest profits are made in financial trading only by those who switch their minds to a completely different way of thinking that would allow them to overcome some of the biggest problems — the psychological problems of trading. Those problem include: the unwillingness to create any rules for trading, failure to take responsibility for the own steps, addiction to the random rewards from the market, giving oneself to the extern control of the trading rather than the internal control of self. Trading in the Zone is the in-depth look at the challenges that every trader faces daily and that the majority of traders fail to overcome and lose their money and waste their time.

Trading with DiNapli Levels is a trading book by Joe DiNapoli that describes a certain complex technical indicator that he has invented and that is usually called DiNapoli levels. The whole indicator is based on the Fibonacci levels and is some way is just a method of application of the Fibonacci levels to the particular market conditions. This book will be more interesting to the investors or the long-term Forex traders as the indicator is best applied to the position trading rather than the intraday trading. Some knowledge of the technical analysis and the basic indicators is required to properly understand this book. But the method that is given here is explained very well. Knowing Fibonacci levels is a plus, but those are explained in this book too.

TraderBO Divergence System — a free Forex book by the Russian trader, writer and marketer Oleg But. It shows the trading systems using the divergence as an indicator. Although this book is mainly about Forex trading, the strategy it describes can be applied on any financial market. The performance of the strategy is tested on the real market conditions and is proved to be profitable. This book presents a lot of information regarding technical analysis in trading, many related tips and techniques, while describing its main strategy, which is based on the divergence. Being a completely free Forex book, it used also to promote another author’s, this time proprietary, Forex strategy — "5 EMAs Forex System". It’s still worth the time you will spend reading it; the whole book is only 44 pages long including contents, copyrights and other such pages.

The New Technical Trader — this Forex book is about technical indicators. The financial markets change constantly, but the technical indicators remain, and they are still as powerful as they were years ago. The power behind the technical indicators presented in this book is the fundamental mathematics of complex dynamic systems — such as the Forex or other financial market. The indicators in this book are grouped in two main areas — methods of price analysis and methods of risk control (money management). All of the presented indicators are thoroughly described and explained. The authors use tutorials, examples, rules list and various tips for different markets as to how apply these indicators to maximize the technical trader’s performance. The trading system compilation is covered in the last chapter of this book, allowing reader to combine the indicators into one market machine.

The Candlestick Course is a handbook of candlestick chartist. And if you are not the one, after reading the book you’ll probably become a devoted follower of Japanese candle charting and trading. According to Steve Nison candlesticks display the current demand and supply situation on the market, show trends better than the common bar charts. According to the author, trading signals (especially reversal signals) are depicted better and recognized easily using the candlestick charting. The good news for all bar traders is that common bar patterns popular in the Western trading style can easily be transferred to candlestick charting. This course will help you determine the patterns on any type of market — commodities, stocks, Forex, bonds etc. Any timeframe can be targeted with candlesticks — from a 1 minute Forex scalper’s trading to the long-term weekly charts of the government bonds.

The Taylor Trading Technique — a really old book about trading. It was written in 1950 and presents its technique examples mostly on the grain trading, which was quite popular those days among small traders (mini traders now). Although it might seem very outdated — both in terms of the strategies and methods and in terms of language it is written in, this book can be an interesting read for those who are interested in history of trading and how some types of modern trading techniques evolved from archaic forms described in Taylor’s book. George Douglas Taylor was a professional trader and also an apologetic supporter of the trading theory, which according to him was as important as the practical skills. This book describes the 3-day method (it’s mentioned as the Book Method). This method presumes that the financial markets move in three-day cycles (similar to the modern Elliot Waves). Those cycles are recognized by the patterns of up- and down-trends. Some of the modern traders still use the techniques described in The Taylor Trading Technique.

Surefire Trading Plans — it’s a popular Forex book that teaches the basics of the professional Forex trading. It won’t show you the basics of the trading; you won’t find a glossary or the some common EMA strategy in this book. It’s intended to for those who have already tried trading and know something about Forex. Surefire Trading Plans is about knowledge of how to build your own Forex trading plan, the most important parts of Forex trading and the real-life examples of the successful trading plans. The whole dedication to the plans in trading is not random. According to Mark McRae (and I agree with him on this issue) the success of the Forex trader is in a great extent dependent on the money management. And there can’t be any good money management with a plan, at least in the financial trading. This Forex book will help both with money management and with the real strategies that can be used with your own plan for trading.

Rapid Forex — Forex Surfing — is a one of the first and the most popular "become rich soon with Forex" books. It has the basics of Forex trading, technical and fundamental analysis, strategies, strategy development, broker advices etc. Being not very specialized in something particular it still has its own idea, which is quite interesting and potentially useful to any Forex trader: Forex trading should be like surfing the waves. When there are good waves in the ocean one has a chance to surf successfully — so is with trading — when there are good conditions on market, one should try to trade there. Catching a wave or knowing where the trend or the reverse is in Forex is also very important. When a skillful surfer is doing his work he does it smoothly and without any emotional stress. Professional Forex trader should trade calmly and know accurately where he will enter a position and where he will close it.

Profitable Candlestick Trading is another trading book about Japanese candlestick trading. Like the others presented here it extensively explains the candlestick patterns and their usage in technical analysis. Stephen Bigalow is thoroughly convinced that the candlestick charting significantly surpasses the all other methods of technical analysis. Japanese candlesticks are the effective tool to extract the profits from all kinds of markets. The only thing that should be done to use this method successfully is to gain the understanding how the candlestick signals work. The educated trader should know not only how certain signal formed by candlestick pattern looks like, but also the inner logic of the reasons that formed this signal. The main idea of the book is that the signals are created by the change in the investor sentiment, thus understanding the signals gives you an advantage before the investors en mass.

Money Management — as its title obviously suggests, is a book about managing money and risks in the leveraged financial trading and investing. Dave Landry presents a rather short book composed of four main parts, each of them dedicated to one topic: Controlling Risks and Capturing Profits, Rules of the Road, Insights from the Pros, Pro Traders Share Their Lessons. Two advantages this book on money management has compared to other trading books on this topic — it is short (it’s really hard to cover such an extensive topic as money management in about 20 pages) and it’s based on experience of the real traders. Two last parts of the book are in the form of dialogs of the author and some professional financial trader. Money Management by Dave Landry is a good book to get the most important information on the money management before starting trading Forex for real.

Microtrading the 1 Minute Chart — a really short (only 7 pages long) Forex strategy guide by the unknown author that will be useful to the technical analysis traders. It can be easily used to base your own ultra short-term Forex trading strategy. It’s presented as a strategy that should be used on 1 minute EUR/USD chart. It uses four standard technical indicators: Bollinger bands, exponential moving average, MACD histogram and relative strength index (RSI). The huge benefit of this Forex trading system is that it can be automated and turned into a mechanical expert advisor (e.g. for MetaTrader 4 platform). All strategy explanations are supported with the chart examples for the readers’ convenience. The only disadvantage of this book is that it doesn’t show any statistical reports of this system’s real trading usage.

Mechanical Trading Systems — a real marvel in the collection of trading books, it can reveal the already working trading strategies and the working methods of creating such strategies. If you think that the mechanical trading (the one that is based solely on the technical analysis) can be profitable on Forex, this book will show you the most simple and the most sophisticated methods that can be applied to develop your own mechanical trading system. The author of this book acknowledges that the strategy or the system alone is not enough, but he applies a lot of passion to teach the readers of this part of trader’s success. If your read this book, you’ll be able to distinguish a bad trading strategy from the good one; you will learn how to back-test and forward-test mechanical systems; you will find out why some systems fail before they are even created and why others are doomed to earn money.

The Mathematics of Money Management is one of the greatest books about the money management in trading. Like in many other fields, money management has two principal sides — psychological and mathematical. Psychological part is about putting the right amount of money at risk at a right time and why emotions tell you to do otherwise. Mathematical is about putting the right amount your funds at risk at a right time, and why statistics tell you to do so. This book is mostly about mathematics. It will give you a system to adhere in order to stop losing money where you shouldn’t lose anything. Even having a good market entry/exit strategy doesn’t guarantee that you will earn from trading; managing your money properly is very important in every kind of financial trading, that’s why I recommend this Forex book so much.

The New Market Wizards is a second book in the series and in some way a sequel of The Market Wizards by the same author. It focuses around the interviews of successful financial traders, who managed to find their place in ever-changing markets and developed their unique tactics and behavior to earn from trading. They are successful enough to be called wizards of the market. Schwager writes that the best way to learn trading is to listen to those who know how to trade. All presented interviews are made with real traders that perfectly fit as the role models. Searching for a holy grail and spending thousands dollars on various systems, tips and signals isn’t the right way of reaching success in Forex; knowing little secrets, techniques and understanding others’ experience is one of the easiest and cheapest ways to master trading.

Candlestick Charting Explained — this book can be considered a holy book of the candlestick chartists. Despite its author confusing Jules Verne with H. G. Wells in the preface to this book, he knows a lot about candlestick patterns and all possible ways of their recognition. Japanese candlesticks are one of the simplest and yet powerful methods of technical analysis. The only problem that they bring to the chart analysis is the pattern recognition. Gregory Morris believe that recognizing the candlestick patterns is not that difficult and can be brought down to limited set of known patterns that must be applied minding the current market context. The book gives extensive examples for every chart pattern; the strength of each pattern is also described in accordance with other patterns. Pattern combinations are shown and explained too.

Forecasting Profits Using Price and Time — a Forex book that shows the way to set goals and targets for the price movement in the future to help to reduce the risks that every trader takes each time he enters an active position on the market. Taking a corrective action before a price moves against the trader is one of the main principles of avoiding losses. Confirmation of the predicted price movement is one of the steps required before entering a position. A probable movement can be forecasted using a technical analysis. Although this book can? t be considered a detailed study for the technical analysis, it shows and explains how to combine and use the simple methods of technical analysis to reduce risks and trade profitably on any market — Forex, stocks, futures, commodities or options. Neural networks are also discussed in application to trading.

Enhancing Trader Performance — a second trading related book by a professional financial trader and psychologist Brett Steenbarger. In this one he offers several interesting techniques of enhancing a trader’s performance by improving his approach to trading and making money on markets. In the series of real-life examples Brett shows how expert traders distinguished themselves from the average traders through their organized and systematic approach to their profession. The gaining of competence and building a working method of sustainable strategy developing are show in this Forex book. The trader’s success is seen as not something constant in this book, but only constant self-improvement and enhancing of the one’s trading methods can bring a real success. The last two chapters of the book include cognitive and behavioral techniques for enhancing the performance.

Mastering Elliott Wave is, as its author claims, the first scientific, objective approach to market forecasting with Elliott Wave Theory. It’s really quite an impressive descriptive and research book that starts off with the most basic concepts of trading with Elliott Waves and finishes with a very complex and sometimes difficult to understand details that would interesting only to extremely advanced financial trader. Nevertheless Glenn Neely and Eric Hall (second author of this book) have done a lot for the popularization and explanation of the Elliott Wave Theory in trading with this piece of literature. In 1990 personal computers couldn’t perform fast technical analysis as they can now, so the book now contains a lot of math calculations that can be easily transferred to the custom automated indicators, but it’s still crucial to learn the inner mechanics of the Elliott Waves and that can be done by reading Mastering Elliott Wave.

Elite Trader’s Secrets — a trading Forex book written by Rich Swannell, the recognized expert in the Elliot Waves techniques. The whole book is dedicated to the statistical analysis, verification, refining and improvement of the Elliot Wave principles. This situation results in a very powerful to tool, which allows traders to better utilize these methods in their trading. Until recent times Elliot Waves were considered to subjective to be used by the average trader. Different Elliot experts had different opinions about the same analyzed chart. The situation was so that the accurate forecast couldn’t be made at all using only Elliot Waves. Rich Swannell created a specialized network of computers; he fed it with the charts database and the every possible Elliot Wave pattern. The result was the statistical explanations of the Elliot Waves. The conclusions from this result are presented in his Forex book.

Trading for a Living is a first financial trading book of the prominent trading writer and teacher Alexander Elder. It shows the most common mistakes that traders fail to recognize and correct in their styles and that prevent them from become financially independent. Trading for a Living shows all the benefits of being a trader — the freedom, the excitement, the quality of life. Becoming a financial trader isn’t something hard to do, it’s just hard to hold down your emotions and begin to think of trading as a serious long-term activity. According to Alexander Elder the majority of the beginning traders fail to control their emotions, they go for the short-term success losing in the long-term period; that makes them lose money, time and a faith in a better financial future. No previous trading experience or knowledge is required to read and understand this book.

Come Into My Trading Room — a Complete Guide to Trading is a book written by an experienced trader and also a teacher, who knows how to explain the essentials of a financial trading in a way that would be interesting to almost anyone, disregarding the professional level of the reader. Come Into My Trading Room is organized so that every part of it is almost independent of the other parts and can be read separately. From this trading book it is possible to learn basic concepts and methods of the financial trading. Unfortunately, Alexander Elder doesn’t give any strategies and advanced methods of analysis or money management. Nevertheless this book can be a strong base for anyone, who wants to learn Forex trading or needs some real knowledge in this area.

The Disciplined Trader is trading psychology book that describes the methods of becoming the disciplined financial trader and stop losing money just because our emotions take control over the mind. It also describes what the discipline in trading is and why is it very important in every financial market, including Forex, stocks, options and others. Mark Douglas is a CEO of a trading software development company and he has a very rich experience in trading. According to him, more than 80% of trader’s success is concentrated in psychology and his treatment of the emotions. This book can serve as a step-by-step guide to adapting successfully to the unusual psychological characteristics of the Forex trading. You will learn to understand the psychology of trading and the importance of personal psychological transformation.

The New Science of Technical Analysis can be considered a bible for every financial trader that is using technical analysis. And Tom DeMark can be considered one of the leading experts in this field. So, it’s needless to say that this book is a must-read for everyone, who wants to get some real knowledge and skills in the field of technical analysis. Every possible aspect of technical analysis is described and explained in this trading book. The only thing that this book lack is the coverage of the rather new methods of technical analysis, such as Fibonacci numbers, chaos theory and other methods that were developed after The New Science has been already written. Nevertheless it’s a real masterpiece of the classical technical analysis literature that can be recommended both to the new and experienced traders — Forex, stocks or anything else related to the financial trading.

Day Trading the Currency Market describes the Forex trading in general, touching almost every aspect of it, but not deepening too far in any of these aspects. Kathy Lien is the experienced trader, Forex consultant and writer and she does her best at introducing the basic principles of trading, analysis and money management to the beginner traders. This book can be useful to some experienced traders that would want to organize their practical knowledge and maybe learn something that they could have missed earlier. Day Trading the Currency Market also offers some useful explanations regarding the various connections between currency market and other financial markets, their influence on each other. The details about each currency and currency pair are also presented to the reader, allowing him to produce a better fundamental analysis decisions in his trading.

Buying and Selling Volatility — a trading book that describes some really interesting type of trading — a volatility trading. It might be not very useful for Forex traders, because it involves the derivative trading (and it’s not very popular with Forex, spot trading is much more popular), but it will be interesting and useful to other traders and investors who don’t limit themselves to Forex only. Traditional financial trading consists of buying and selling certain instruments and closing the position when the price of the instruments reaches a desired profit level. All that such trader needs is the entry price and the exit price. The difference (positive or negative) is the trader’s profit or loss. Volatility trading offered by Connolly Kevin is different. Volatility trader buys or sells volatility through a complex system of hedged options and other derivative. The benefit of such method is that one can earn successfully on volatile markets without even paying attention to the entry and exit prices of the given instrument.