Why is it important to read and learn about forex trading?
Forex trading is by no means a simple profession. It requires months and years of hard graft to learn and master the markets. Traders need to have the discipline to create and stick to trading plans and learn to accept losses as part and parcel of the overall process. As the saying goes, knowledge is power. That certainly rings true in the world of forex trading.
The forex world is such a fast-paced industry. Currencies can fluctuate in value for all manner of reasons, including economic and political factors within a nation. Being a success in the forex markets requires a general appreciation of the physical execution of trades, as well as the psychology of trading in terms of handling losses and risk management. As a beginner or intermediate forex trader, the best way to improve that appreciation for the forex markets is to read, read and read some more.
Why do we recommend these books?
One of the easiest and most effective ways to broaden your overall knowledge of the forex markets is to read books written by experts in the industry. Whether you want a clear, digestible overview of what forex trading is about or you’re seeking different approaches to the forex markets, there are books out there that can help. We’ve put together a list of five popular books suitable for forex traders at both ends of the experience spectrum.
Currency Trading for Dummies by Brian Dolan
Dummies is one of the most popular publishers of introductory level books spanning all manner of topics and subjects. It’s a book franchise that’s made its name by simplifying even the most complex talking points and making them easier to digest. Brian Dolan’s Currency Trading for Dummies equips newcomers to forex trading with the knowledge to understand the forex market and trade it.
There are five core sections within the guide. First and foremost, there is a plain-English introduction to how the foreign exchange markets work, including the factors that move the price of currencies and the types of currency pairs available. The book then teaches readers to set realistic investment goals and learn about the concept of risk-reward ratios. Readers are also taught how to understand and use trading tools to manipulate data and master technical analysis to pinpoint trading angles and opportunities.
The book then veers away from technical analysis to fundamental analysis, equipping readers with tricks of the trade to interpret economic data and official press releases and news statements. All of which can have an impact on market sentiment. Last but by no means least, Dolan reinforces the importance of a trading “game plan”. The fifth and final section explains how to develop your own trading strategies.
Forex Trading: The Basics Explained in Simple Terms by Jim Brown
Jim Brown’s Forex Trading: The Basics Explained in Simple Terms is available in paperback or Kindle form. It’s a consistent ‘best seller’ on Amazon and the book also comes with a free bonus trading system attached. Jim Brown is a self-made full-time forex trader. He learned how to trade the markets after enrolling in a stock trading event in 2002. Brown, who was raised in Queensland, Australia, and now lives and trades online in Vietnam, discusses the importance of filtering out the abundance of forex trading information on the internet.
Brown’s book particularly resonates with forex trading beginners because it is direct and concise, with patronising language left at the door. After defining the forex markets and how they work, Brown goes immediately into basic trading strategies for entering and exiting the markets. He talks in-depth about trading psychology and the need for self-discipline and managing your mind, as well as your positions in the markets. His closing tips make it easier to hand-pick a forex broker too. At the end of the book, readers can download Brown’s custom forex trading indicators, which are designed to be compatible with MetaTrader 4 and 5 platforms.
The Art of Currency Trading by Brent Donnelly
Brent Donnelly has been successfully trading the forex markets for more than two decades. Within his book, titled The Art of Currency Trading, he divulges some of the trading strategies and techniques used to yield long-term profits from forex trading. From front to back, the book takes readers on a forex trading journey as a beginner through to intermediate and advanced trading setups and systems.
If you want an insider’s view as to what moves the forex markets, this is a great starting point. You’ll also get a clear understanding of how to fuse fundamental and technical analysis and risk management to undertake forex trades that don’t put undue risk on your trading bankroll and attempt to maximise potential profits. Within the book, you will also encounter bespoke forex techniques that can be used as a “rinse and repeat” to try and extract sustainable profits from the markets.
It’s great to lean on Donnelly’s trading experience, with industry-leading insights into forex trading psychology and self-improvement – two of the major ingredients that turn new financial traders into profitable ones.
Price Action Trading Secrets by Rayner Theo
The number-one best-seller in Amazon’s Commodities Trading section, Rayner Theo’s Price Action Trading Secrets teaches investors a new way to get to grips with the “secret language” of the financial markets. It’s a book that’s suitable for all kinds of financial trading, including forex. The premise of price action trading is that traders can improve the execution of opening and closing traders without having to depend upon macro fundamentals like news releases and economic updates.
One of the most fascinating aspects of this book is the ten “natural laws of trading” that professional traders rarely divulge to newcomers. It also equips forex trading beginners with the technical analysis to spot when support or resistance points are set to break. This is a particularly vital technique, enabling readers to stay on the right side of a move more often.
Theo’s book is also highly graphical, which is helpful for those who prefer visual aids when learning new concepts. There are over 70 different trading graphs and charts to view and understand how Theo’s trading strategies and concepts work in action.
Forex Trading 2021: Forex Trading – Beginners’ Guide to the Best Swing and Day Trading Strategies, Tools, Tactics, and Psychology to Profit from Outstanding Short-Term Trading Opportunities on Currencies Pairs by David Reese
The most recently released of our five recommended forex trading books, David Reese’s Forex Trading 2021 paperback book reaches out to those thinking of trading forex online for a living. Reese calls out those seeking a reliable passive income or long-term financial freedom and outlines why the forex markets offer a wealth of opportunities for day and swing trading.
Benefit from Reese’s time-honoured experience of the forex markets, which have helped him to put together a host of ‘dos and don’ts’ for forex trading beginners. After reading Reese’s book you will be more comfortable with embracing volatility rather than viewing it as a danger. Those who prefer the idea of trading forex using fundamental analysis to gauge market sentiment can digest Reese’s ‘seven approaches to fundamental analysis’ all of which are explained in plain English.
Reese also uses his years of trading experience to recommend the leading trading tools and software that can support your decision-making in the months and years ahead. Many of which are compatible with most leading forex brokers. Reese doesn’t sugar coat the fact that 95% of traders lose money. Instead, he outlines the five common errors that newcomers make in the forex markets. Primarily, these can be used as a cautionary tale to avoid making the same mistakes.
Get started with our recommended forex trading books
This quintet of books makes for excellent reading material on the world of foreign exchange. Even experienced stock traders have found the forex markets a challenge. It’s an industry that must always be respected, with the most successful forex traders always willing to learn and grow.
By heeding the advice of these experienced, profitable forex trading authors you are getting a leg up on the markets before you’ve even invested a penny.