This is a book that I have been wanting to read for awhile, but it always seemed to get pushed down my reading list.
Well, it got pushed all the way back up to the top when I received a box from none other than Walter Peters.
If you have never heard of him, I interviewed him on the Podcast in Episode #7 and he is currently the most watched interview on the Trading Heroes YouTube channel.
To see more books I recommend, check out the Library and Book Club.
The Most Important Section Of This Book
Let's start at the top. Walter is a psychologist by training and it really shines through in this book.
Unfortunately, psychology is not sexy to most aspiring traders, so it is usually placed at the end of trading books. It is no different in this book.
This being the case, I would actually recommend that you skip to the end of this book and read the psychology section first. It really is that good.
In particular, I liked what they write about the “circle of doom.” I see so many traders get trapped in it and I have been in it myself.
There are also other topics such as: runners/gunners, gaining confidence and becoming an expert, which I found very useful.
The Rest Of The Book
But the rest of this book is not chopped liver either. I would recommend reading the entire book from cover-to-cover. Besides the section on psychology, there were two other sections that I found particularly informative.
First, the trading strategies are explained very well. They are simple and make sense. However, what I liked the most is that the book takes the time to explain the reason behind why they work.
Most books just say: look for this setup…then do this. But I liked the fact that this book explains what you should be looking for before the setups that might invalidate them.
However, the book doesn't stop there. It goes one step further and encourages you to test the strategies using tools like Naked-Markets.
The trouble that I have with many trading courses is that they expect you to take them at their word that their strategy works.
You just have to start trading it and you will be golden.
But I have learned from experience that if you do not understand the system well and understand the drawdowns, you will not have the confidence to stick with it.
This is what causes people to jump from system to system until they finally think that this Forex trading thing doesn't work.
Backtesting can help you really understand how a trading method works.
Second, I really liked the way that Alex and Water lay out a road map for deciding when you are ready to move on to the next step.
For example, how do you know when you are ready to open a live account? How do you know if you should keep demo trading?
They provide very specific parameters that will let you know when you are ready for the next level.
Of course these are just guidelines, but they make a lot of sense and give you something to shoot for.
What Is Naked Trading Is Appealing And Why Do It?
Naked trading is basically their flavor of price action trading. It is when you use price action alone to determine when to enter and exit trades. No indicators and no complicated chart setup.
If you have ever been confused by indicators or complicated trading systems that require several different criteria to be met before you can take a trade, then Naked Trading can be a breath of fresh air.
I am currently testing some of the strategies myself.
Their strategies include: The Big Shadow, Wammies /Moolahs and more. I especially like the Trendy Kangaroo.
Conclusion
So if this appeals to you, then check out Naked Forex: High-Probability Techniques for Trading Without Indicators, by Alex Nekritin and Walter Peters.
If you prefer using indicators, then this book may not be for you. But if you are looking to simplify your trading and get rid of all of the clutter on your charts, this is a book that I recommend.
And I would say that, even if I purchased this book at full price.
For more book recommendations, browse the Library and Book Club.
What are the common names of the strategies found in the book (like I know the big shadow means engulfing bars but I don’t know the common names of some of the others)? I’ll need the the common names so I’ll be able to understand them better and do further research on them.
Just read the book. They have slightly different definitions than the traditional patterns and that’s why they have different names.
one of the best books ever, i am reading it now still i have 3 more chapters.
the best section in this book is how to draw the support and resistance areas using line chart.
but i didn’t like the new name of the price action patterns (Kangaroo tail -> pin bar)
i recommend all the traders to read this book.
Thanks for your input!
What a coincidence! I’m smack dab in the middle of this book as I type this. The approach in this book is pretty damn simple (the good kind of simple). I really wish I would have read this right after finishing the School of Pipsology the first time. Everything contained in it is explained very clearly (almost to a fault); if one can’t understand the concepts within, there’s likely no hope for them reading other trading literature. I’ve heard criticisms saying the authors are just peddling the same old price action mumbo jumbo, but the setups (or catalysts) in the book really are a specific (more accurate) subset of traditional price action patterns. Like you say, it’s their “flavor” of price action.
On a side note, this book renewed my interest in Forex Tester. After a Google search for that, I was even more intrigued by a sister product of it called Forex Smart Tools, which is apparently one hell of a product (trade log and calculator) by the same folks. It’d be great to have you review it! It costs for a license, but there might be some trial/lease arrangement to be made.
Hey Jake, glad to hear it. Yeah, this is one of the few books that really gives people a grounded and well-rounded Forex trading education. I read a really harsh review of the book on Amazon about they are just self promoters, blah, blah blah. But if people actually took the time to study a chart and even just look at generic price action principles, they would see that price action is a legitimate strategy.
Thanks for the suggestion on reviewing FST! However, I’m not a big believer in paying for logging or calculator tools. First because they are like trading systems, they need to be customized to the trader. Second because it’s not hard to put together a spreadsheet for logging or for calculations.
Forex Tester is certainly a must have though.
I appreciate the thoughtful comments and I hope your trading is going well.
Cheers,
Hugh
I think we may have read the same Amazon reviews. I have to admit though, what really made me pull the trigger on this book was the likability I found in Walter in his videos (as well as TTL #7 here on this site). It’s true what they say: Don’t judge a book by a bad review on Amazon…or something like that.
No worries. I agree with reluctancy to pay for such tools (or at least at the price they’re asking). It’s the reason I haven’t purchased the bundle of FT2+FST. I have one of those spreadsheet templates for trade logging/calculations prepared by someone else, and I agree it’s sufficient. But I may be sold on the concept of a dedicated trade logging program if it really is more intuitive and automated. As they say, it’s a database and not just a spreadsheet. I LIKE to think I’d appreciate the difference.
Cheers to good trading,
Jake
Thanks for the feedback Jake. Cool, whatever works…I say 🙂
Hugh