What book should I read to really learn currency trading??

Saying you have tried trading and something is mising so what book should you read... is like going to a doctor and saying you feel unwell, what medicine should you take?

Any answer without considerable questioning is likely to be wide of the mark.

What trading have you done? Could be anything from scalping to weekly swing trading? What went wrong? What timeframe do you want to trade? How do you want to approach trading... do you want lots of intraday action or position trading where you trade hourly or 4-hour or even daily charts?

How does your mind work... does TA or fundamentals appeal to you. What experience of either do you have. What are your goals? What time can you put into trading... full or part time?

Learning from books will take years to learn to apply in real trading - many books on trading as most useful as firelighters. Have you the capital to pay say $300 pm for mentoring? Really that's best if you can find the right person that suits your goals.
 
Quote from oraclewizard77:

Technical analysis works on forex like everything else. However, I am not sure the people who wrote any of the books out there actually are profitable traders.

Do they have a public track record?

I use technical analysis to trade but not alot of indicators. You kind of need to see what works for you. There are very few people who trade for a living. Do you really think that they would give away all their secrets in a $ 30/book?
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I think people give away many secrets in those $30 books. And they can do it safely too. Because most people will never try something enough times to really learn it. Those people will be discouraged after a few losing attempts and big losses and say "it does not work". You are absolutely correct about trying to figure out what works for you.

The problem that most cannot understand is that no system, technical or fundamental will work consistently without great money management, great risk management, an understanding of probability, and the proper attitude. Tech/fund analysis will only give you a slightly better probability of winning. Neither one works every time and neither one is even close to foolproof without the other parts of the equation in place.

The books work fine. They are the basis for almost everything I have learned. But they were just the starting point, it took, and still takes, some work. I don't consider it hard work because I enjoy doing it.
 
The books really don't have anything that isn't on the web. A little background, a little TA you've already heard about, and a little on interest rates. If you're very lucky they might have a chart showing most liquid hours.

The free lessons here will have 99% of what you'll find in a book.
http://www.babypips.com/school/

Also you can search the web with: free forex pdf and you'll find more info than you can read. Might even find a copy of Bird Watching . . . - EZ
 
Quote from fatrat:

This is just my opinion -- it's hotly contested on ET -- but indicator based technical analysis just does not work.
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Not true in general but almost true. Indicator based trading is part of a greater scheme that also involves other things like purchasing power, psychology, insight, etc.

I know of a person, actually a woman, who made millions of dollars in FX using a simple MA crossover system. I cannot say how much of that was due to sheer luck but indicators can serve as a good guide.

The problem arises when people look at indicators as predictors of price and not as a form of guidance to enforce discipline. Think about that. It is discipline that makes money combined with risk management. Indicators help guide the actions. Never predict anything, I agree about that

Bill
 
Alot of the forex specific materials, you can get over the net and I agree that most technical analsysi works across different markets so there's really nothing that makes technical analysis any different in forex as opposed to markets.

Having said that, a good book on trading in general is High Probability Trading. But you'll find most of what you learn comes from experience. When starting off, try to trade the higher timeframes, they give you more time in between bars to make a decision and act so thereby making you less prone to excessive and emotional trading.

Plus don't risk too much and use low leverage, you'll be amazed how much you can make if you just consistently make pips and compound your lots.

Best
 
Quote from oraclewizard77:

Technical analysis works on forex like everything else. However, I am not sure the people who wrote any of the books out there actually are profitable traders.

Do they have a public track record?

I use technical analysis to trade but not alot of indicators. You kind of need to see what works for you. There are very few people who trade for a living. Do you really think that they would give away all their secrets in a $ 30/book?
More...

He he,
a 30$/book x 100 000 newbie new comer fx learners, is much more profitable than a 10k fx accounts with 1000% yearly/performance track record...do you know a lot of people doing a 1k%?
So I would defenitley put my secrets away for 30$/book
Anyway humans are so stubbern that although you show the trend, they would still go against it!!!:)
ZC
 
Quote from fatrat:

I lost about $10,000 learning how to trade before I made it all back. I traded futures, currencies, and stocks. I'm still here 5 years later. Not super wealthy, but not broke either.

This is just my opinion -- it's hotly contested on ET -- but indicator based technical analysis just does not work. The reason is because the indicators generally don't model what counts in any concrete sense. Plotting volatility in a 14-period time window or an RSI is a questionable activity that won't work over the long run. Stay away from books like this because they will trick you into thinking it's as simple as buying when something is oversold and selling when something is overbought.

Stay away from most books and pick up a book on what counts in currency markets. If whatever book you get has technical analysis, it better be heavy on the fundamentals. Truth be told, most of what you find in Borders or Barnes and Noble is a poor waste of money that will cause you to lose money. I wish those books weren't out there because they lead people (like me in the past) into falsely thinking they are informed.

Fundamentals are what really drive the market, or hunches about the nature of fundamentals. The "smart money" is essentially building forecasting models and doing time-series analysis where they have confidence intervals on the outcome of results. They'll hedge their bets and manage their risk carefully. Most books don't teach you how to manage risk, other than basic ideas about risk vs. reward constructed from some arbitrary chart or listing of data.

However, fundamentals information is not updated constantly. You have to eventually learn what components and pieces of the market cause movements and drive the market one way or the other. It's a long, hard process.

You're going to want to incorporate things like:

- How does realtime news affect stocks?
- What is the main sentiment in the financial press, and does it run contrary to the markets?
- What are the driving factors behind exchange rates on currencies?
- What are the interest rates everywhere else?

Currencies are said to trend well because there is some deep underlying macroeconomic process going on and the powers that be want to make changes to the, let's say, "status quo."

Do NOT think of the market as anything more than a game built around probability. This is simpler said than done, but many traders, even when profitable, don't fully understand what it is that constitutes their "edge".

It's going to take you a LONG time to master this game, and, unfortunately, the winners in the game benefit from you having a messed up mindset.
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Great post, one of the best ones I've read in ET.

You may want to add a few more details to help this fellow out with some resources for your suggestions.
 
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