Can reading too many books be bad? | Forex Factory

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Can reading too many books be bad?

  • #1
  • First Post: Dec 15, 2006 10:38pm Dec 15, 2006 10:38pm
Hi,

Just wondering, can reading all kind of different trading books be actually bad for you? I mean each book can gives you different tactics, strategy and ideas, but some contradict each other and might even confuse you...

I hope I'm worng as I am new in FOREX and am really enjoying reading different books on trading...

anyone agree or dis-agree? and why?
  • #2
  • Dec 15, 2006 10:55pm Dec 15, 2006 10:55pm
There are many ways to trade and be successful. Finding 'your method' may take a lot of inquiry, into yourself mostly.

Building up a library can get costly and yes there are contradictions.

So check books out at the library if you can, using interlibrary loan so you can get them from all over the US.

Check out this forum for how people trade. Find out what seems right for you.

Lou
  • #3
  • Edited 11:22pm Dec 15, 2006 11:02pm | Edited 11:22pm
Quoting spank
Hi,

Just wondering, can reading all kind of different trading books be actually bad for you? I mean each book can gives you different tactics, strategy and ideas, but some contradict each other and might even confuse you...

I hope I'm worng as I am new in FOREX and am really enjoying reading different books on trading...

anyone agree or dis-agree? and why?
Reading different books is good if they are good books, such as by Nison, Cornelius Luca, or John Murphy, etc. Reading books by wannabes such as so called authors that actually work for brokers can be bad b/c they actually want to make you trade more so they make more commissions or spreads.

Good trading opportunities are few and far between, so knowing different areas will expand your opportunities and thus you would avoid being antsy waiting for trades if you only know of a few set ups. Being antsy will make you trade when you should not be trading. So read as many good books as you can by authorities on the subjects. Read the best book on each subject.

Technical Analysis=Cornelius Luca and John Murphy
Candlesticks=Steve Nison
Elliot Wave=Elliot Wave Principle
  • #4
  • Dec 15, 2006 11:19pm Dec 15, 2006 11:19pm
I'm going to throw a wrench in the spokes..


I agree with Lou that checking out books when you can is very helpful in keeping costs reasonable, and wwwin's filter of making sure they are "good books"... and here is my wrench:

I also believe that reading a variety of good books on various topics from whatever source (library, eBooks from free online sources and organizations, etc) is helpful to one's overall well being.

I usually have at least a half dozen books on topics from astrophysics to life in zimbabwe. One thing that will come out of this practice if read concurrently is that you will have unexpected "Aha" moments due to your unconcious mind taking data from all the uncorrelated sources and coming up with unexpected solutions to situations/challenges as they arise or have been dwelt upon.

Try it, you might get an unexpected whack on the side of the head and come up with the next FXmouseTrap.

Cheers,
Thom
  • #5
  • Dec 15, 2006 11:21pm Dec 15, 2006 11:21pm
I've read several books on trading and I got limited use out of it. I think information overload can happen. I found a strategy that works for me with minor success and I found it by sitting in front of my computer and trying different strategies I found on the net that appealed to me. I think these forums are more valuable than any overpriced trading book.
How you act is more important than how you feel.
  • #6
  • Edited Dec 16, 2006 12:03am Dec 15, 2006 11:30pm | Edited Dec 16, 2006 12:03am
Quoting Warmagus
I've read several books on trading and I got limited use out of it. I think information overload can happen. I found a strategy that works for me with minor success and I found it by sitting in front of my computer and trying different strategies I found on the net that appealed to me. I think these forums are more valuable than any overpriced trading book.
Even if you have a good book, read it and put it away, it will not help. These books are to be used as reference, making sure that the patterns fit all the parameters, or that all requirements of a particular price action is met. If you really put in the time, and trade only good set ups, you would be amazed at how accurate these time proven techniques used by banks, hedge funds, and professional traders, are.

Examples of recent good set ups that produced what in theory they should have, taken by following books to the T w/o cutting corners

At least 120 pips and counting, move not over yet (if had followed recommended SL at prior's day high, good stomach would have been required to follow this one to the T)
http://www.forexfactory.com/forexfor...244#post156244

At least 400 pips even if used large 100 pip trailing stop.
http://www.forexfactory.com/forexfor...707#post145707
  • #7
  • Dec 16, 2006 10:37am Dec 16, 2006 10:37am
experience is everything... it is 10 times more important than anything you will read in a book.

especially dangerous are books that give you rules you *must* follow.

Like (paraphrasing) "never question your system, always follow it blindly.. take every signal no matter what... don't use your brain at all".. believe it or not, many people recommend this (but they write it a bit differently)... it reminds me of religion... ("believe everything we tell you, never question anything..." i.e. faith

or "always follow this xyz style of money management"... FX is like everything, there is no cookie-cutter approach. A good approach is to first look at your goals, then create a system and money management style that suits them. A good money management style for one system and one set of goals, might be less than ideal for another.

another example "only trade the London session"... this is good advice for many systems, but not all. So again it depends on your system/style of trading. But many books on fx trading seem to preach.

On the other hand, apparently a good book on economics will be quite helpful. But don't put too much weight on any single thing you read in an FX Trading book, just skim them and file interesting things you find away somewhere in your brain for future reference.

So it is not the reading many books that is the problem, but rather listening too much to what they say that can get you into trouble IMO.
  • #8
  • Dec 16, 2006 11:07am Dec 16, 2006 11:07am
Quoting ycomp
especially dangerous are books that give you rules you *must* follow.

Like (paraphrasing) "never question your system, always follow it blindly.. take every signal no matter what... don't use your brain at all"
Not sure what kind of books you have been reading. I have never read a book that stated the above, could you tell me what book said that so that I am sure never to buy it? It sounds like you have been reading ebooks and not any good book by a respected author.
  • #9
  • Dec 16, 2006 11:51am Dec 16, 2006 11:51am
ah, ok... I had just woken up when I posted that... I thought he was asking about fx trading ebooks.

Quoting wwwin
Not sure what kind of books you have been reading. I have never read a book that stated the above, could you tell me what book said that so that I am sure never to buy it? It sounds like you have been reading ebooks and not any good book by a respected author.
but still there is a problem for me (and probably many other people)... where it is easy to get swamped if you read too many books. If you skim many books, that is different. If you are trying to soak in every detail of every book - it can be too much information for most people.

but the real problem with too much information is not from books but from reading analysis. In my opinion it is a bad idea to read every article you can find every day about what is happening in the market. Reading a couple good ones is fine, but reading everything is a real problem (at least when you are reading a lot of technical analysis... reading lots of fundamentals isn't so bad - but unnecessary)

But IMO the most important thing is to get a feel for the market. And that comes from experience.
  • #10
  • Dec 16, 2006 1:09pm Dec 16, 2006 1:09pm
Quoting ycomp
ah, ok... I had just woken up when I posted that... I thought he was asking about fx trading ebooks.



but still there is a problem for me (and probably many other people)... where it is easy to get swamped if you read too many books. If you skim many books, that is different. If you are trying to soak in every detail of every book - it can be too much information for most people.

but the real problem with too much information is not from books but from reading analysis. In my opinion it is a bad idea to read every article you can find every day about what is happening in the market. Reading a couple good ones is fine, but reading everything is a real problem (at least when you are reading a lot of technical analysis... reading lots of fundamentals isn't so bad - but unnecessary)

But IMO the most important thing is to get a feel for the market. And that comes from experience.
Yes I agree, that is why I said earlier just read one book on each area, the best one on each area, and use it as a reference. You cannot learn all of it by reading the book. Just know that is there, and then go back to it when something reminds you of what you have read, and just use that small area of the book.
As far a reading every article. I also agree, b/c they would confuse you. Someone from Lehman says sell the pound, while another from Morgan Stanley advises their clients to buy it. Or some analyst would say the Yen to 115 by year end, while another, the same day, would say to 120.
That is why I think is important to learn, so you can listen to yourself and have confidence, a key component.

As far as experience, I also agree with you. I will take the point further, you need experience with a live account. It's not the same trading demo. Your mind wants to play tricks when real money is involved. On a demo, you might let winners run, and cut losses short, as you should. On a live, you might wait another day to cut a loss to see if it turns, or you might be tempted to take a small profit, just not to take a loss, when you could have had a real winner.
  • #11
  • Dec 16, 2006 4:51pm Dec 16, 2006 4:51pm
Quoting ycomp
Like (paraphrasing) "never question your system, always follow it blindly.. take every signal no matter what... don't use your brain at all".. believe it or not, many people recommend this (but they write it a bit differently)... it reminds me of religion... ("believe everything we tell you, never question anything..." i.e. faith
I wouldn't call that faith. Well, blind faith maybe; but I definitely wouldn't support it. I think the only way to truly have faith in anything is to question it and find your own belief in it (be it trading, your children, god, whatever).

That is why I beleive like ycomp that you need to question these systems. It's only human nature that you're going to ask about "Well, what if I change the period of X indicator from Y to Z?" Do it! Don't second guess yourself on if you should endeavour to change things up or not. Do it so you know everything you can about this system so you can build your own faith or distrust in the system.

As far as reading a lot of books goes...I personally read about two hours a day, but not just trading material (even then it's only 50/50 if it's FX related trading). I also agree with Accrete that you need to try and learn as much as you can about everything around you because you really do have those little "Aha!" moments while reading a book on Asian cuisine, or you have that moment about how to actually properly fix Asian cuisine while reading Market Wizards. Read all you can, and ask all the questions you can.
  • #12
  • Dec 16, 2006 4:59pm Dec 16, 2006 4:59pm
my #1 advice to new traders is to read as many books as they can. knowledge is key, and there is no better place to find it.
Relax and be happy.
  • #13
  • Dec 16, 2006 5:00pm Dec 16, 2006 5:00pm
Quoting ycomp
So it is not the reading many books that is the problem, but rather listening too much to what they say that can get you into trouble IMO.
very good point
Relax and be happy.
  • #14
  • Dec 16, 2006 6:09pm Dec 16, 2006 6:09pm
Accrete said:

"One thing that will come out of this practice if read concurrently is that you will have unexpected "Aha" moments due to your unconcious mind taking data from all the uncorrelated sources and coming up with unexpected solutions to situations/challenges as they arise or have been dwelt upon."


I totally agree with Accrete on this phenomenon.


Lou
  • #15
  • Edited 8:51pm Dec 16, 2006 6:38pm | Edited 8:51pm
Ok, I don't want to knock reading. Reading is great and it will open up worlds for you that blow TV out of the water, plus the guy who seems to know everything is the guy who reads widely. I think the guy who will usually take your money in fx is the guy who knows more than you. So reading definitely ties in there. Experience plays a big roll too, you've got those grizzled veterans running around who've had all their fur burnt off and they'll f*ck you up. And he got that crusty by trading, not reading.
How you act is more important than how you feel.
  • #16
  • Dec 16, 2006 7:13pm Dec 16, 2006 7:13pm
a lot of information is good, but more importantly is to utilize the info efficiently, properly, and timely. The market, just like the road, is constantly changing, always need to be on the watch for fundamentals, tech, sentiment. I say it's how one can relate the information and use it is the key. Some info you read in books may not be directly useful, but it's good information to know as it may indirectly, subconciously, be partly responsible in making a trade.
  • #17
  • Dec 16, 2006 7:35pm Dec 16, 2006 7:35pm
What I find with books is so many of them contradict themselves it is hopeless. Reading to many books will confuses you and yes it is bad. It is like over analyzing, we all know over analyzing is bad and reading to many books is just that.

I have never read a book out forex it took up enough of my life as it was I didn't want to bring it into my spare time to. Books are not great sources of information because they are someone else's point of view on a market with many different masks. You can not try to see the market in the way Kathy Lien sees it or in the way Jimmy Young sees it. If you do you will fail, you are your own person and need to view the market in your own way if you look at it through someone else's eyes it will only lead to confusion.
  • #18
  • Dec 16, 2006 7:48pm Dec 16, 2006 7:48pm
I do believe that reading many books and/or trying many different techniques can be negative. In my opinion, the job of a trader is that of a brick-layer as opossed to that of an erudite. In order to make money off the markets, you need to spot certain patterns that work for you and repeat them over and over and over like a robot. For example, if you follow a MA-crossover system, then you dont need to know about candle sticks, Elliot waves and whatnot, as they will most likely send conflicting signals. You just need to lay your bricks one after the other using whatever technique works for you. Once you find that technique, dont mess it up adding extra flavor to it, you dont need it.

Remember young Grosshopper: when in the market, be a brick-layer
  • #19
  • Dec 17, 2006 12:33am Dec 17, 2006 12:33am
Some books are good, but ALOT of books are bad................just try to take something out of everything that you read. Dont believe it because it is in print.


Rsq
  • #20
  • Dec 17, 2006 3:27am Dec 17, 2006 3:27am
hi all,

nothing is soooo good & nothing is sooo bad...and nothing is perfect...it depend on yur style...everything for sure have it own benefit. Define yur self...what u want to be. The most important things is to minimize the risk by applying good money management.

regards,
candlepower
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