A library with a trading laptop and trading books

Becoming a winning trader is certainly one of the most difficult careers (90% of retail investors fail). I certainly struggled at the start. Becoming a winning trader can take an average of one year (but most never become one). At the start of my trading career, I needed to figure out where to begin and I was often clueless. I had to constantly research on my own, and my trading suffered as a result.

However, my previous pain is your gain the list below, carefully curated and broken down are the most important books that turned around my trading. The books listed below will offer a boost for the losing traders and winning traders looking for a bit more of an edge! 

Please note the list is broken up into several categories: Must Read Trading Books, Technical Analysis, and Trading Psychology.

Best Must-Read Trading Books

Hedge Fund Market Wizards: How Winning Traders Win - By Jack D. Schwager

The author of the book interviews the best traders/investors of this current generation. This book offers tons of gems, tips, and trading philosophies, that you can't find elsewhere. Reading through the interviews, I found patterns in why all these traders were successful. That pattern is that all traders knew their edge and constantly exploited it, and never deviated! Ultimately, this will be the book that will transform losing traders into winning traders (out of all of them on this list). Or help you realize you don't have an edge and your best bet is to become a passive investor.

Stock Investing for Dummies - By Paul Mladjenovic

I'm serious when I recommend this book, it's the easiest to understand and covers all the necessary topics needed to start trading and investing.  It is perfect for beginners, this book lays out the fundamentals of stock investing, including risk management and portfolio diversification. It’s a primer on choosing stocks, mutual funds, and ETFs, guiding you toward making smart investment choices. If you are trying to get the best bang for your book, buying this book is the best value out of all of them on the list.

Best Books On Technical Analysis

Technical Analysis of the Financial Markets - By John Murphy

Murphy’s comprehensive guide is the gateway to understanding technical analysis. It is a great introductory book and one you will see yourself referring to often as a reference guide.
 his book covers market charts, patterns, and analytical tools in depth, enabling you to make informed trading decisions based on technical data. The reader should expect to be exposed to a range of information when it comes to technical indicators, patterns, and how to cover technical analysis tools. This is a great starting guide if you want to start focusing on technical analysis but think it may be overwhelming at first.

Encyclopedia of Chart Patterns  - By Thomas N. Bulkowski

This book is perfect for understanding and learning about chart patterns, as the title says it all. It is the 1st and last book needed in chart patterns. This is the type of book that you constantly pull out, reading a few pages here and there until it is embedded in your brain. Aside from learning about chart patterns, which is a given, what you ultimately should take away is the statistics and reliability of each pattern. Reading this book, you should realize what the edge is in using these patterns. You will learn which ones are worth paying attention to in terms of profit and reliability and those that must be ignored.

Japanese Candlestick Charting Techniques - By Steve Nison

Possibly the easiest and most important book on this list. This book describes candlestick patterns in detail. It has a very easy learning curve and can do wonders for your trading. Once you understand candlestick patterns, you will start seeing stock charts in a new light. Understanding candlestick patterns helps prevent you from making the easy/stupid mistakes of going long at bearish trend reversals, or going short on bullish trend reversals (as Candlesticks are the most reliable in identifying these trend changes).

Two free great articles on this site cover Japanese Candlesticks: Mastering the Art of Japanese Candlestick Reading (recommended to read first), as well as How To Unlock The Power Of Japanese Candlesticks.

Bollinger on Bollinger Bands - By John Bollinger

Bollinger Bands are the most powerful indicators I use (I don't use many). Bollinger Bands help you determine, when a stock is overbought/oversold in a very reliable way since this indicator is about providing mathematical statistics on price movement. This book will provide the basics of Bollinger Bands and exploit patterns that develop with this indicator. 

Bollinger Bands help cover your shorts near the bottom and avoid being squeezed, and similarly will aid you in selling your longs when they are overbought. There is so much more to Bollinger Bands, reading this book will give you a head start (the rest of the knowledge comes through experience).

Bollinger Bands are an absolute must on any chart I decide to analyze because they give so much information. The beauty of it is, not many people understand its true power. Check out our in-depth article on Bollinger Bands: Why Mastering Bollinger Bands Is A Must

Best Books On Trading Psychology

The New Trading for a Living - By Alexander Elder

Dr. Elder brings to light the psychological aspects of trading, an often-overlooked but crucial element. You'll learn about the importance of discipline, managing emotions, and the role of technical analysis in trading. This book aims to shape you into a well-rounded trader, equipped with mental and technical tools.

Trading in the Zone - By Mark Douglas

"Trading in the Zone" is a comprehensive guide that delves into the psychological challenges and mental pitfalls that traders often face. Douglas emphasizes the importance of having a consistent mindset and how psychological factors can significantly impact trading performance. The book is structured to help traders understand and overcome the inherent emotional hurdles that come with trading. Readers can expect to learn how to cultivate a trader's mindset focused on probability, risk management, and self-awareness. The book helps in understanding the importance of detaching emotions from trading decisions and the need for consistency in approach.

Also, check out 4 Top Must-Read Trading Books From a Hedge Fund Manager.

For those interested in free content check out our frequently updated Stock Market Education Library.