What To Read?? 📚

What’s up Pip Surfers! Our objective is to help you get

smarter about your trading in 5-minute reads.

What’s on the agenda today:

• Top 3 trading books you probably haven’t heard of 🧐

• The BOE cuts its rates and catch up on the US Fed outlook 📊

• Nikkei has had the biggest daily drop since the 1987 crash 😲

Top 3 trading books you probably haven’t heard of 📚

These are 3 books that don’t make the headliners but are worth reading for any trader at almost any level. Now there are the classics such as Trading In The Zone and The Mental Game Of Trading, but we are here to uncover some books you may have never heard of in a bit more detail!

Starting off with 12 habitudes of highly successful traders written by Ruth Barrons Roosevelt. Ruth is a highly successful trader and has been coaching traders for more than a decade. She has trading her capital in equities and futures markets since 1979 and was the former vice president of Prudential Securities, so she’s got a pretty great track record and validation as an author and someone you can trust for reliable information.
The book covers 12 essential habits (or as she terms them ‘habitudes’) that traders require to be successful in an ever-changing environment. Using real examples of how she and others have dealt with setbacks using her methods and psychological tactics, she aims to equip you with some knowledge that is unparalleled to what other books offer. Another intriguing aspect of the book is how she delves into the belief systems of people and how we need to alter these to become a better more effective trader, something that truly stands out compared to other trading books. No matter the level you are at Pip Surfer highly recommends you read this, as it offers value even for the most experienced of traders.

A second noteworthy mention is The Chimp Paradox by Prof Steve Peters. And yes, fully aware this does not specifically relate to trading, however, the models and ideology which is presented to us are extremely relatable to trading. The book breaks it down into three main parts; The Chimp, The Human, and The Computer. The novel dives into the inner workings of human psychology; the human part is our logical thinking, reasoning, planning, and conscious thinking part. It is the slowest part of all 3 but this is due to it being associated with logic and facts. The second side is the chimp, being our emotional and impulsive brain activity. This part of the brain responds irrationally to fear and we have little control over this unless it is trained well. Finally the computer. It is taken on the view that it is the source for the human and the chimp, it stores our memories and the limited or unlimited belief systems we have about ourselves and the world around us. The book further dives into how to effectively re-train your brain to think in a better way, the application is so relevant to trading that I had to include this book today.

The final book recommendation is Best Loser Wins By Tom Hougaard. Tom is an ex-institutional trader. He used to run a free telegram group where he would trade in front of thousands of people daily, his average lot size was around $3500 a point! This book outlines what stops most humans from ever reaching the point of being able to trade this type of position sizing and what separates the two. Where most books in the trading world nowadays delve into strategy that may or may not apply to your strategy, this book focuses on psychology (80% of trading) and exposes vulnerabilities and barriers that prevent people from trading with large position sizing and risk. It emphasizes how our thinking needs to be shifted and gives some very insightful points on how to go about doing this to improve our careers in trading. Tom makes it very clear about the importance of journaling, creating truths about your trading, and confronting your failures head-on. This is a must-read.

BOE rate cuts and the FED outlook catch-up 📈

Last week was a heavy fundamental for the markets and there were a couple of blood baths due to this. Let’s first unpack the BOE. So the Bank of England cut rates for the first time since September of 2023 by 25bps. The Pound’s reaction on the day of release was as expected, with a volatile downward movement seen in GBPUSD and other Pound pairs. The reason for the cut according to Reuters is; that there is an undecided vote as to whether inflation pressures have been eased sufficiently. From this statement, traders should be watching the inflationary data for volatility as the BOE is expecting inflation to rise in the short term. Fundamentally we could expect a temporary downside occurring in the pound.

The US Fed announced they do not currently have any set plans to cut rates in September as they are awaiting data, with a focus on the labor market. On Friday we had the NFP announcement which was a miss, sending the dollar into a tumble. This data suggests rate cuts are most likely going to happen sooner rather than later.

The Japanese Market Crash! 💥📉

Friday the 3rd of August was the largest crash in a single for the Nikkei since 1987…… This tells us something is brewing. The crash occurrence was due to worldwide political uncertainty and pre-dominantly the uncertainty in the US market. Japan raised interest rates by 15bps, with this being the second hike of the year, and further plans on hiking due to contain inflation. Further downside can then be expected in the Japanese market and the Yen can be expected to increase.

Thanks for reading! Let me know if you found this article helpful and if you have read any of the books suggested, we’d love to know what you thought of them! 📚