If you want to become a successful investor and a trader, you should develop the habit of learning from the experience of other traders and investors. The best method to learn from the experience of other traders and investors is to read books about them and their investing strategies. Did you read my last post on Market Wizards Book series by Jack Schwager? If you haven’t read these Market Wizard Book series than you should read these books because in these books Jack Schwager has done a great job by interviewing a select few group of people who have consistently beaten the markets over and over again. You should also go through this list of 40 great books on investing that you should plan to read over time. Investing is more of an art than science. You need to develop the feel of the market. You should know how to check the pulse of the market and know what is going to happen next. These books are going to teach you a lot.
Trend Following: Learn To Make Millions In Up Or Down Markets
One of the classic trading books that you should not miss reading is this one, “Trend Following: Learn To Make Millions In Up Or Down Markets.” This book has been written by Michael W. Covel. Now some reviewers are not happy with this book. They want a book that gives them the rules for entry and exit into the market. Well, this book does not give you any trend entry and exit rules. What this book talks about is the big picture that every trader should have. Big picture is that trend following works and it has been successfully used by traders to make millions.
You should watch the above video in which Michael Covel interviews Ed Seykota. His Trend Following Book includes great trend traders that includes David Harding, Bill Dunn, John W. Henry, Ed Seykota, Keith Campbell, Richard Dennis and more. Part II of the book talks about the big events, crashes and panic that includes the 2008 stock market bubble and crash, Long Term Capital Management Collapse and a host of other market panics and bubbles.
As a trader you should develop the big picture. Looking at the charts trying to figure out whether this is a head and shoulder pattern or a Gartley pattern won’t give you the big picture. But this book is going to give you the big picture. Always remember, markers are just people buying and selling. Price reflects the emotions of the people at a particular point of time. If the price is going up, you know that the emotions are bullish and if the price is going down, you know that the emotions are bearish.
You should read this book if you are a serious trader and a serious investor. Don’t think that just staying glued to the charts will make you a great trader and a great investor. What will make you a great trader and a great investor is the big picture that will give you the instincts in navigating through the market chaos. Don’t miss the big picture!