Sometimes the best way to gain important perspective on the best way to move forward in trading is to pick up a really good book. Here you find the best books on futures day trading you have to read if you are starting with futures trading or you finally are ready to get successful with futures swing & day trading.
Why you should be reading outside of the trading floor:
Approximately three-quarters of Americans do not read at all (Pew Research Center, Survey Conducted: Jan 3-10, 2018). But traders have to possess a wealth of niche knowledge—who else knows how to hedge short term interest rates? However, prop shops want to recruit only well-rounded traders who can demonstrate that their knowledge goes beyond the basic prerequisites; Investors are attracted to traders who know “a little about a lot.” In other words, they want their traders they fund who have been exposed to a range of different fields and who understand how these fields may intersect with markets.
One of the best ways to develop this understanding is to read often and broadly. And no, scrolling through the headlines on Facebook and Twitter doesn’t count. Fortunately, there is an abundance of sources that offer well-researched, reliable information. If your goal is to dovetail readability and depth, it is hard to beat a Futures Trading book.
- Market Wizards, by Jack D. Schwager, 4.6/5 Stars on Amazon
- Mind over Markets, by James F. Dalton, 4.6/5 Stars on Amazon
- Trading Instincts, Curtis Faith, 4.6/5 Stars on Amazon
- Trading in the Zone, Mark Douglas, 4.7/5 Stars on Amazon
- Money Machine, Philip Coggan
- The Psychology of Trading, Brett N. Steenbarger, 4.6/5 Stars on Amazon
- Way of the Turtle, Curtis Faith, 4.3/5 Stars on Amazon
- Tape Reading and Market Tactics, Humphrey B. Neill, 4.4/5 Stars on Amazon
- An Introduction to Global Financial Markets, Stephen Valdez, 4.7/5 Stars on Amazon
- Blink: The Power of Thinking Without Thinking, Malcolm Gladwell, 4.5/5 Stars on Amazon
- The Day Trader, Lewis Borsellino, 4/5 Stars on Amazon
The book has something for both the experienced trader and someone who is reading for a mere insight into the trading world. It gives both a summary of the hard work and knock-backs one experiences when starting out and advice on how to ensure your career is one that flourishes and enables you to achieve long and short-term targets alike. Throughout the book traders give their own unique take on: keys to success, trading techniques, risk management, and the best psychological approach to trading. When reading other books which focus on an individual’s career, you find the same key lessons are repeated throughout. In this sense, Market Wizards gives the equivalent to several books worth of content. Specifically, it provides key lessons on those aspects that are important to consider when expanding your trading knowledge.
Like many of the other best trading novels, Market Wizards leaves you with a sense of inspiration; you now know what it takes to improve your all-round trading! It is a comprehensive guide on how to prepare for what lies ahead, using the experience of some of the best traders as your foundation. By leaning on their experience, you can learn vital lessons from the information the market will throw at you on a daily basis. The book is neatly constructed in a question and answer format making it literally “full of answers”. Each clearly labeled chapter covers the traits or style of each trader meaning you can delve into those sections most relevant to you.
The overriding theme of the book is that despite the differing trading approaches of the traders, each one has similar underlying principles. These are easy to grasp as each trader makes repeated reference to what they feel made them into the traders they are today. The book is written by active traders which gives a real credibility to the content you are reading. It is also riddled with trading psychology and ‘the trader’s mindset’ which means the reader with the ability to spot weaknesses in their own psychological makeup will be able to replace these with the strengths described by these successful traders.
We recommend this book as it provides a well rounded guide to what is required to become a successful trader. It obviously focuses on discipline and familiarity with the markets, but also provides an analysis and evaluation of a range of trading approaches and underlines a series of essential psychological rules.
This book delves into the auction process and its graphical representation in the form of market profile. This representation is a technical analysis tool used by many market participants across all time frames which organises and structures the market using three key parameters; time, volume and price. It’s without doubt the most important futures trading book. Every one of our trader trainees and participants in our Trader Educational Program has to read this trading book from cover to cover.
Curtis Faith, the author of Way of the Turtle, looks at why intuition and instinct can be very important trading tools by examining different approaches traders can take to train their instincts and combine them with careful analysis to become intuitive traders. He compares left brain (analysis) and right brain (intuition). Expert traders use both to make trading decisions.
Using instinct in trading is not the same as trading using your emotion, i.e. reacting to fear and hope, which can negatively impact your trading decisions. The best traders know what to do at the right time; they cannot always explain exactly why, as this is their trading instinct, and this “skill” takes time and experience to develop.
Your intuition is only as good as the training it has received. Faith describes how important the training process is, especially in the early stages of a trader’s career. The trading principles learned need to be good as the outcome will only be as good as the foundation on which it is built. It is about feeding the right brain with enough of the requisite raw material to be able to make proper judgements; the instincts of the novice trader often being wrong. Faith highlights that mistakes will be made, but it is how they are programmed in the subconscious that stops the same mistakes happening again.
The book’s underlying message is that hard work has to be done in the early stages of a trading career and it is important short cuts are not taken for lessons to be truly learnt. One important quote from Faith is “the game taught me the game”. He suggests that you have to throw yourself into the market and that there is no substitute to learning how to become a Master trader other than to actually trade. Only by developing your instincts will you be able to recognise and execute good trading opportunities, and just as importantly, avoid bad opportunities.
Faith mentions in his previous book Way of the Turtle that emotional and psychological strength were the most important ingredients for trading success. He still believes this to be true but now adds that he underestimated the value of intuition. Faith was a swing (medium-term) trader whilst trading under the Turtle programme, taking a very systematic and logical approach. However, his ideas about how instinct can help a trader are relevant for any timeframe trader, especially day traders.
That having the right psychology is vital to be successful and to achieve a high level of trading performance consistency. Trading in the Zone a really good futures frading book aims to take an in-depth look at the natural flaws in human behavior which prevent traders from reaching their full potential; a consistently profitable trading career.
The Money Machine – How the City Works is one of the few financial books I have read that strikes the right balance between in-depth explanations and easy to read concepts, even for people with limited financial knowledge. Very few numbers and formulas are included in this book and most concepts are explained with historical examples in an easy to understand format.
In this book the author Brett N. Steenbarger explores in detail some of the trappings of the human mind. The idea that psychology plays a pivotal part in being a successful trader isn’t a novel one. This principle is littered all over the pages of almost every trading literature out in the marketplace.
What sets this book apart however is the level of detail the author goes into to explain the actual thought processes that occur when negative impulses are triggered and the provision of a plethora of techniques to interrupt the emergence of such impulses.
The central idea proposed is simple: behaviour is patterned. The author submits that negative patterned behaviour can be interrupted and there are specific effective techniques that can be utilised to achieve this. The author also encourages the reader to form an “Internal Observer” for the purposes of continuous self-monitoring. The idea here is to be constantly aware of one’s emotional state. As these concepts are discussed in detail the reader is also encouraged to embark on a journey of self-discovery and analysis in order to explore the best trading style suited to his psychological predisposition.
We found this book to be very educational in fostering the understanding of the human psyche. The techniques proposed have certainly helped my trading by leaps and bounds. For example, I have come to understand that often a person’s negative patterned behaviour can manifest itself physically, which is why I am more acutely aware of my posture when trading because it helps me observe my emotional state.
In short this book is very easy to read with a narrative that is delivered through a series of some interesting anecdotes. Although slightly lengthy in certain sections, it is also packed with ideas, advice and techniques to help the aspiring trader achieve a higher level of performance. A must read.
This Book, the Turtle experiment which forms the subject of this enlightening book began as a bet between trading gurus Richard Dennis and William Eckhardt over 20 years ago. Dennis’s hypothesis, in contrast to his colleague’s, was that he could transform almost anyone into a winning trader.
The trainees that were recruited, trained and backed financially with million dollar trading accounts were known as the Turtles as Dennis believed that he could raise traders in the same way they raise turtles on farms in Singapore. This book was written by one of the most successful Turtles, Curtis M. Faith. In Way of the Turtle he shares his experiences, what he was taught, what he believes are the most important aspects of trading and why he succeeded where others failed.
The Turtles were taught to think of the long run and were given a mechanical system with an edge that overtime would be successful. Their primary goal was to stay in the game and the rules the Turtles had to follow were very simple. The key to their success would be consistency and discipline. The Turtle method was based on market movements that result from the systematic and repeated irrationality that are embedded in the majority of traders’ emotions. They never tried to predict market direction, but looked for indicators that a market was in a particular state. Dennis believed that good traders don’t try to predict what the market will do, but understand what the market is actually doing. For example, during fast market conditions the Turtles were advised not to panic but to wait for the market to stabilize before placing their orders. They were also implored to ignore the outcome of individual trades, to forget the past, to learn from it, to not worry about it and to believe in the effects of trading with positive expectation.
The difference between the best and worst performing of the Turtles was their individual psychological makeup. The author reveals the insurmountable challenge for some of the Turtles of accurately following the instructions of their mentors. Even though they were shown a successful trading system, many Turtles simply could not overcome their characters, emotions and ego to achieve significant profit. Although Faith proves that trading can be taught successfully, I firmly believe that some individuals are better suited to it than others. I believe you have to be committed, disciplined and most of all honest with yourself if you want to make it as a trader. The key lesson for me from Curtis’s book was to understand the importance of psychology in both market behaviour and individual performance. Whilst human emotion can be a source of great opportunity in trading, it can also be one of the greatest obstacles to consistent success. Market participants in financial markets do not always act rationally. Winning traders, like the best of the Turtles, take advantage of this irrational behaviour.
“Realize that you are playing the coldest, bitterest game in the world…Almost anything is fair in stock trading. The whole idea is to outsmart the other fellow.”
For anyone searching for a holy grail in trading, this book is definitely not for you. However, anyone looking to understand market dynamics and the drivers of supply and demand within a market, we would recommend that you read this book immediately.
One might think that a book written on trading in the 1930s would be extremely outdated and hold little credence to the modern day. This would be incorrect. Too many people nowadays are looking to indicators for a ‘holy grail’ that will give them immediate and consistent success. There is only one technique that has been able to consistently produce profitable day traders, and that is the ability to ‘read the tape’.
“But remember that your charts are records only of past human behaviour.”
Charts will only demonstrate past activity; in order to be a profitable trader one must be able to interpret the information as it is presented to you. This is the essence of tape reading; the ability to interpret the imbalance in supply and demand as the trades are printing on the tape.
The author goes into great detail to explain market dynamics and what factors drives price movement within a market. However, the topics discussed in this book are refreshingly simple and, as I mentioned earlier, they are the techniques that have produced successful traders and survived the test of time. The main element of the book is how supply and demand is depicted on the tape and the author uses several detailed examples to ensure the information is presented to the reader in the most complete way. The author also discusses the price action that takes place at key levels and how to interpret this action in order to successfully speculate upon the future movement of the stock.
There is also a section included in the futures trading book on market philosophy and human behaviour. However, there are more comprehensive guides to market philosophy and I believe that this was included by the author to help build the extensive picture of market dynamics.
As would be expected from a book written in the 1930s, there are several elements that are outdated. For example, the author talks about monitoring the movement of steel as a major component of the Dow Jones Industrial Average. Such elements are obviously not as relevant to the modern day but demonstrate to the reader the comprehensive nature of market dynamics. An example of this that the author discusses is that he witnesses a lot of pullbacks retracing to the 50% mark of the initial move. This theory has evolved into Fibonacci retracements, a common technical tool today, but the underlying principle remains the same.
This book provides the reader with an excellent guide to the market dynamics that drive supply and demand. We regard this book as highly as Reminiscences of a Stock Operator in terms of ‘must reads’ for anyone wishing to develop a successful career in day trading.
The 5th Edition of Stephen Valdez’s book covering the world’s financial markets manages to achieve something which, having read a large sample of financial textbooks, is rare; there is a fine balance between a book that is lightweight and one that is inaccessible to the novice trader, which the author negotiates in this case successfully.
Those among us who are not the most gifted with numbers and the technical nuances at the heart of the markets need not worry, as this book is written in a very relaxed style; this in particular made the book stand out from others I have read or, in more extreme cases, tried to read.
We are first introduced to the world of modern economics in this futures trading book, fueled by debt and consumer spending on the ‘never-never’; the history of banking dating back to 13th Century Italy is explained, moving into an overview of the roles of central, commercial and investment banks in today’s economies. As professional traders it can be very easy to develop an intraday knowledge of your chosen markets without necessarily understanding the fundamental forces at work in the background; the initial chapters of this book will very quickly bring you up to speed, with the added benefit of making you appear highly knowledgeable at the dinner table in what is surely the nation’s topic du jour.
The subsequent chapters provide in-depth analysis of the securities markets, namely money/bond markets, stock exchanges and hedge funds/PE. This is where the book really came into its own for us. Especially for fixed-income traders it was able to learn a great deal on how debt instruments are constructed and brought to the markets, as well as some more subtle points on the theory behind their pricing. Foreign Exchange markets are also covered, as are financial futures, options and other derivatives.
A section on insurance is curiously sandwiched between chapters covering economic powers both current and emerging; namely the European Union, China and India. These give a fascinating historical account of how 12 sovereign states came to operate under one currency and financial system, as well as providing an insight into how the East will increasingly dominate the global economic outlook in years to come.
Whilst these sections (nor, dare we say, any of the material in this book) will necessarily help you become more profitable as a professional trader, we would consider this book an invaluable introduction to the world of finance as a whole, as well as a useful reference point and source of amusement for the seasoned veteran. Valdez’s work manages to be detailed without being turgid; we would recommend that anyone who is serious about a long-term career in or around the markets should set aside a couple of days to absorb the information in this book – without doubt we feel a more complete trader for doing so.
This book is about the ability of the human mind to make split second decisions. Our brain has a great ability to extract the most important information out of the overwhelming amount of noise we are surrounded with and make very accurate decision, even while under pressure. This phenomenon, sometimes called gut feeling, can give us an edge, but can also lead to biased decisions.
In Blink, the author describes many examples of research in this field of psychology, proving how powerful our brains really are. The book is of interested because, as a futures traders, we sometimes find ourself in a situation where we instinctively know what to do, but do not act upon it. As a result of not believing what the creative part of our brain is “whispering” to the rational one I do not always act and react as we should. This lack of trust leads to hesitation and missed opportunities.
To be honest, before reading this book I knew about gut feeling but did not really believe that it could be so powerful.
This is particularly true in trading when the amount of information we have to process simultaneously can be overwhelming. However, the human brain is able to focus on the most important details, filter out the garbage and execute trades accurately. Reading about experts who have developed a “feeling” for their opinions and decisions increased my awareness that we do have the ability to read markets unconsciously. Therefore, instead of fighting this “feeling” we should further explore and improve this skill. However, one has to remember that learning to trust our “feelings” takes experience and repeated effort. We think that day-traders are in an ideal situation to accelerate this learning process because they observe the markets day after day, for many hours at a time.
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This book is primarily the account of an Italian American, Lewis Borsellino, whose determination enabled him to become one of the biggest traders in the S&P 500 futures pit. The main focus of the author is explaining what made him stand out from other less successful traders drawing primarily on his early family life and the characteristics that were etched into him by these experiences.
Curating this list of futures trading books was a real challenge, as there are countless more deserving fair recognition that we could also recommend. Consider 11 of them as a starting point. Having a habit to read will help you in the long run. During prop shop interviews, you could also be asked to talk about the most recent book you read (which happened to me more than once!).
If you’re looking to further broaden your personal collection, we’ve outlined a couple more books below that we’ve also found are worth your time.