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  1. #1
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    Will reading books really help you in trading?

    Hi traders! Value trader is "on air".

    I’ve been asked very often of what books to read. In this thread I will share with you my ideas on this topic and give a small read-list of books that helped me in my development in early days of my trading career.

    As far as I concern, reading and consuming information is a little bit overvalued because it’s not logics that drives our actions, it’s our deep beliefs. Those beliefs can be obtained only in the process of deliberate practice. When you’ve seen something with your own eyes 10000 times, you will believe in what you are doing. If you have just read book on the topic, you will easily forget everything learned from the book once market starts to behave in volatile unpredictable manner (it very often does).

    Of course, when we come to trading, first thing we want to do is to read, read and read more. That’s our natural way to deal with uncertainty. We want to get a quick answer, but more often than not, we are just internalizing some ideas that make us feel confused in a process of real trading. For example – have you ever seen such beautiful trending lines (or, say, support/resistance lines?) in a real trading environment? Most of trading best sellers include plenty of beautiful but unrealistic (or, rare) trading setups.

    I guess, no. So, the first element thing that most of trading literature does – it fails to prepare us to real trading environment, which happens to be much more ambiguous, much more complex than it is shown on beautiful snapshots.

    Confirmatory bias

    The main thing that 90% of trading books do – they show you how your ideal setup would look like. By the way, it’s not only trading books, most books on success and personal growth also do the same thing. They tell you what you would need to do to get to point B from point A. But, they don’t tell you what you are not expected to do.

    The better advice for the field where 90% fail to survive, will not tell you «how to achieve your goal», but rather how to survive in a process of testing and probing your ideas in a process of real trading.

    Warren Buffet once had said that «Investing process is saying «no» to 90 proposals and «yes» to just one proposal».
    Best trading books that may change the way you think, will not tell you what to do in each and every case. They, instead, will focus your attention on nuances, details and obstacles that are rarely spoken about. Nuances make difference between amateur and professional trader.
    I will provide small list of books that helped me some years ago.


    «Enhancing trader performance» by B. Steenbarger.

    Brett Steenbarger is a famous trading psychologist (and a trader himself). In this book he talks not just about «greed and fear», but about various steps of learning process. You may understand from this book how to find your own trading niche, how to understand you position of the learning curve.
    From this book, I’ve captured one very valuable idea – all our internal characteristics (or behavioral characteristics) that we consider as obstacles, as something to fight with, in reality have huge potential to become our strengths.

    For example, in my trading it was anxiety and inability to hold position in some cases, I was closing position too early very often, and therefore, and missed some good opportunities. Later on, I have understood that I had pretty strong feel of changing market momentum. So, I should have become momentum trader, not trend-following trader. After I have understood this, I’ve changed my trading style and made it more synchronized with my strengths.

    You see – when I was trying to fight it, it was very tough, when I’ve made strengths out of my weaknesses – things have become much easier.

    «Mind over markets» and «Markets in profile» by J. Dalton.

    J. Dalton is authority in the world of auction market theory, but what us more valuable – he has huge experience in trading and in the past was running institutional trading desk working for big market participants.

    Markets are very visual. If you want to capture important information from visual analysis of market profile as well as candlestick chart, this book is for you.
    This book may seem a bit complex and it is not giving direct advices of what to do – when to open and close a position. But as I have told you before – real trading education is not about knowing your ideal setup, it’s about ability to know the whole picture including bad setups as well.
    Also, this book is about «market profile» – not every trader has this tool at his disposal.

    «Diary of professional commodity trader» by P. Brandt

    And last (but not least) in my read-list is a book by Peter Brandt, professional money manager, who was keeping trading journal in a real time for several months describing his thoughts and explaining his actions. This circumstance makes this book valuable, because it’s really what we would like to know – how does professional trader think and act in a real time.
    Also, tools that Peter Brandt uses – conventional technical and charting analysis, it will be familiar to any trader. Though, he trades on big timeframes (W1 and D1), this book will help to change the way you think about most trading challenges and ideas.

    Good luck!

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    Last edited by Value trader; 06-30-2014 at 09:32 AM.

  2. #581
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    Quote Originally Posted by Hukam View Post
    We should do trade with support and resistance, technical analysis based trading system have good risk and reward for trader's and they can earn good profit from the help of technical analysis trading method. Although this is not success, but a good use of their discipline along with the support and resistance can surely give them good conservative trading.
    that is the basic for all trading methods, support resistance and also trend line too, and with them, if traders can make good analysis, they will know to set for how much the risk and reward ratio that will used for trading forex, that is a good thing for them to keep stable on the market where the risk is limited and the target is set easier touched by the market price

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  3. #582
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    I have read so many boooks until now to learn forex. Learn from forex books is good, it can increase our knowledge and makes us know many things about this business. but then we must use the knowledge in our trading everyday. IF we use the knowledge in our daily trading, then we will understand easily about this market and business

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  4. #583
    Trader techboy's Avatar
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    Quote Originally Posted by newentry View Post
    that is the basic for all trading methods, support resistance and also trend line too, and with them, if traders can make good analysis, they will know to set for how much the risk and reward ratio that will used for trading forex, that is a good thing for them to keep stable on the market where the risk is limited and the target is set easier touched by the market price
    There are many approach that we can use in trading but whatever it maybe it is important that we are very familiar on such approach so that we can maximize the profit potential, but there are basic things that we should follow in trading that we must apply to any strategy such as risk management, risk reward ratio and discipline.

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    " Trading is 70% Psychology, 15% Risk Management and 15% Strategy ! "

  5. #584
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    I get to understand things better when it is seen than just reading, for newbies the best way to get a clear understanding of this business is through practical, reading alone does not do much and can easily be forgotten, you need to read many articles and books, but you still need to practice to see the market and how it behaves.

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  6. #585
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    [lang=de]No it won't. I do not think reading books will help a lot. I suggest to acquire practical method. Like trading with demo account or real account. Learning forex is like learning riding bicycle. Where practical knowledge will be necessary. Practical way will help you to learn forex perfectly. Use practical way and that will help you to grow your knowledge and trading skill.[/lang]

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  7. #586
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    You can find many great webinars which are free. Some are about technical analysis, some about psychology, fundamentals. Different traders run them. They show you screen so it is very easy to see how others are trading, what is most important for them. What’s more, you have chat window. In most cases, you can ask questions during an online seminar or there is dedicated Q&A session right after webinars finish.

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  8. #587
    Trader J_C_Anderson's Avatar
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    To my mind, reading books is very helpful. Books constitute a great source of information for all traders, especially for newbie ones. Most of the books dedicated to trading could be found within the Internet, so you can easily create your own collection. There are several types of books tat could be interesting for the trader. The books about the economy and finance in general would be useful to improve the knowledge on market fundamentals and learn more about how everything works since it is important for the trader to understand some fundamental mechanisms moving the prices.
    To find new ideas or to get better understanding of technical analysis in general trader could search for the appropriate books even if they were written many years ago and describe other markets like stocks and futures - the main advantage of technical analysis is that it works almost the same way independently from the particular instruments, so you can easily apply those approaches to any market including Forex.
    It is quite easy to find information about trading nowadays. The only thing trader have to do is to evaluate it properly to be able to distinguish something that is realy valuable from useless books written by those who have no real experience in trading.

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  9. #588
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    As you know, it is better to learn from other people's mistakes. In this sense, reading good thematic books written in plain language is a huge help to beginners. It would be foolish not to take this opportunity.

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  10. #589
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    You are right, it will be very useful! Thanks for sharing.

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