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Timeless Trading Books Every Trader Should Read 

Last Updated: February 12, 2020

By Rayner

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In today’s episode, you’ll discover the essential trading books every trader must read so you can become a consistently profitable trader. 

So tune in right now…

Resources

The Best Trading Books of All Time

Jesse Livermore Quotes: 19 Powerful Lessons From The Legend

Transcript

Hey, hey, what’s up my friends? 

In this episode, I’ll share with you 5 timeless trading books, that every trader should read.

1. Technical Analysis of the Financial Markets by John J. Murphy

The reason why I’m recommending this book is that technical analysis is a very broad field. Different trading books focus on different aspects. May some on chart patterns, some on indicators, some on price action, some on systems trading, etc. 

So this book is kind of like a textbook of technical analysis. 

It shows you the different types of trading concepts out there. You can learn a bit of everything from there like a buffet. 

You can dabble in a little bit of everything and have a broad understanding of what’s going on. In future if you want to specialize in a certain aspect, you can look out of books and resources on it.

But this book is more of a primer to someone who is new to trading to learn more about technical analysis. This book is a broad generalisation of it and it’s good for you to get started when you want to learn more about trading.

2. The Art and Science of Technical Analysis by Adam Grimes

This book is actually the opposite of the first book that I’ve recommended. This book goes very deep into price action and into market structures. 

For example, just the topic on trend itself takes many pages. So this book dives deep and it’s recommended for those of you who already have the understanding of the basics of technical analysis. 

It also covers stuff like risk management, trade management, and much more. 

This book is for you when you feel ready to level-up your trading and want to take things deeper.

3. Market Wizards by Jack Schwager

This shouldn’t come as a surprise. 

I would recommend reading all the Market Wizards series, because some covers the stock markets, some is the hedge fund Market Wizards. So just read all of them. 

This book gives you a broad overview of how successful traders trade. 

There are different ways to trade the markets. You have systematic traders, day traders, macro trades and much more. 

This book really shows you the different types of trading methodologies out there. And you’ll find a trading methodology that resonates with you. Like for me, trend-following, I really resonated with that and I dive deep into trend-following.

I started reading other books on trend following.

So this book really gives you a broad overview of the different way to trade the markets. And once you’ve learned it, you can dive deeper into other resources available elsewhere.

4. Reminiscence of a Stock Operator by Jesse Livermore

This is in essence, the biography of Jesse Livermore. 

I would say he’s the most famous trader of all time. And some of the comments I’ve gotten is that Jesse Livermore committed suicide, he’s bankrupt, how can he be a good trader? Why do you want to learn from him?

Well, I think just because he didn’t have a happy ending doesn’t mean there are no lessons that you can take away from it.

One of the few lessons I took away from it was you don’t want to overleverage yourself. Because it hurts you financially and mentally. Look at what happened to Jesse Livermore.

And secondly, you want to be trading with a plan. Because Jesse Livermore, in his early years of trading, was trading without a plan, and he was trading all over the place. 

But when he had a structure and he knew what stocks to buy and when to buy, that’s where he’s trading really took off like a rocket. 

And since he also dealt with stock trading, one of the principles that he kept highlighting was that he likes to buy stocks that are trading at the highs, not at the lows. Stocks that break out of the highs. 

These are the stocks that he wants to be buying because these are the leaders, and these are the stocks that tend to outperform the market. I find that this is true even to this date. 

So yes, Reminiscences of a Stock Operator is a great book. There are many lessons to learn from it, what to do, as well as what not to do. 

Next…

5. Trading in the Zone by Mark Douglas

This is for you if you’re always struggling with your own trading psychology.

Trading psychology is very personal. Different traders have different ways of coping with it. 

But this book kind of breaks it down in a way to let you know that the market has nothing against you. 

Whatever trading system or strategy that you trade, there is a normal distribution between your wins and losses. You have winning streaks and losing streaks, and the market doesn’t know who you are, what you are, or what you want to do. 

So the market has nothing against you. 

This book would help with your trading psychology. If you’re always struggling with it, taking things personally and always wondering why the market is out to get you, then you need to read this book. 

With that said, I’ve come towards the end of today’s episode and I’ll talk to you soon.

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