This is one of the first books I read when it first came out in 1993 and while many traders buy newer books thinking, they can discover more modern and effective trading tools and techniques or a secret they can use to ensure success – there are no secrets or short cuts, trading success is down to you and your learning. Trading success is just down to a logical method and the ability to control yourself when trading it. The book is not written in relation to Forex trading, as there was no retail currency market at the time but this doesn't matter – good principles of trading should work in any market.
There is material to enjoy for new or experienced traders and Elder, being a psychologist covers the psychology of trading, in an easy to understand way that will show even new traders. He sows why the basics of trading are easy to learn but why, trading success proves to be elusive for most traders. You don't just get psychology though, you get thoughts on good money management which is needed for any trader to win at Forex trading, a look at the guru industry and a look at some currency trading techniques, systems and how to use a variety of technical indicators. – so there is something for everyone and newbie traders in particular, will gain a lot from Elder's insight.
Individual and Mass Psychology
"The market does not know you exist. You can do nothing to influence it. You can only control your behavior." (A Elder)
This part of the book covers trading psychology from both an individual and crowd perspective and is the most valuable part of the book in my view. The author talks about destructive emotions and and controlling yourself and not getting caught up in crowd hysteria. I also really liked the contrast between alcoholics and losing trading behaviour and the idea gurus should not be followed.
Charting, Indicators and Systems
Elder covers basic chart analysis and I liked his views on channel trading and fading breakouts and its generally a good all round introduction to chart analysis and chart patterns. You also good info on several technical indicators such as – Williams %R, the stochastic Momentum and rate of Change, moving averages, the MACD and an intro to Elder Ray ( named after the author ) and the Force Index. As a good general info, its all well put together and gives the basics of using some of the best indicators.
You get three systems – the Triple Screen Trading System, The Parabolic Trading System and the Channel Trading system and these show you how to put together a logical trading system which can make money and I personally, adapted the channel trading system over 15 years ago and it still works well trading currencies today.
Its a good intro to money management and it's importance in achieving trading success. The only part I would disagree with is his view of the 2% rule of risk which is one of the most commonly accepted rules of money management but as we have discussed elsewhere on this site, its not sound advice in terms of preserving equity or increasing profitability.
The reason Trading For a Living is such a good book is because it gives you a bit of everything that is involved in trading success. Sure there are books which cover money management better or even trading psychology but for a one volume book this book covers a bit of everything you need to make currency trading profits.
Furthermore, the writers style is really easy to read and he gets his points across clearly. As a book for beginners I think this is an excellent introduction to the world of trading and how to make money. You may not end up trading for a living but Elder's book shows you why it can be done and will allow you to trade for profit with confidence and the odds on your side – We hope you enjoyed our review of Trading for a Living and would urge you to go and buy this book – we hope you enjoy it.