A reader asked me for my top 10 trading books, so in true Letterman spirit, I count down my favorite 10 trading books. How many have you read?
10. Encyclopedia of Chart Patterns - Thomas Bulkowski has created a comprehensive tome of all the indicators you need to know and much more. I use this book regularly to get up to speed on new ideas that I'm working on that have their roots in a popular technical indicator.
9. Trade Your Way to Financial Freedom - Trading coach Van Tharp is a master at the probabilities of trading, and as a result Tharp's discussion on position sizing is a must-read.
8. The New Market Wizards: Conversations with America's Top Traders, New Edition - Jack Schwager wrote the original Market Wizards and has since followed it up with two more Wizards books. The benefit is learning how the best pros think, so you can model their success.
7. Big Trends in Trading - I can't help that I think my book is good! But seriously, many tell me that what they like best is that the book is layered to be great for multiple readings. As you grow your trading knowledge, come back to this book and it will offer you new insights you had not been ready for previously.
6. Trading To Win - Ari Kiev is a great psychological coach, and Kiev lays out a number of the psychology and money management issues that keep traders from reaching their goals.
5. The Disciplined Trader: Developing Winning Attitudes - Mark Douglas breaks new ground into the heart, mind and soul of traders everywhere. Definitely one I try to re-read once per year.
4. Technical Analysis of the Financial Markets - This was the first book on technical analysis I ever read, and I still consider it the first starting place for any of my analysts that I'm working with who need a good primer on technical analysis.
3. How to Make Money in Stocks - William O'Neill founded Investors Business Daily and still espouses his CANSLIM principles to this day. While I am primarily a technical analyst, I agree with O'Neill that earnings growth is the primary fundamental factor to focus on to drive growth in aggressive stocks.
2. Trading For A Living: Psychology, Trading Tactics, Money Management - Alexander Elder continues to be one of the most sought-after trading authors. This is due not only to his creative treatments of indicators like the Force Index, but also to his real-world application discussions.
1. Reminscences of a Stock Operator - Edwin Lefevre allegedly modeled this book over famous early 1900's speculator Jesse Livermore. It's amazing how nearly one century later, these issues in trading are universal and not solved.
Price Headley is the founder and chief analyst of BigTrends.com.