Zak Mir Book Review Special – Diary Of A Currency Trader by Samuel J Rae
I have to admit that perhaps the best part of this book from my perspective – over 25 years in the financial markets, is that I am not reviewing yet another “beginners” guide. I find them as tedious as they are typically useless. Although Rae does hit us ever so gently with an initial potted history of FX and his story of how he got into the markets it does not condescend and gets down to brass tacks so to speak almost instantaneously. On this basis alone, it can be said that Samuel Rae gets off on the right foot with his Diary, and which is essentially a trading method. The key with every great strategy is whether you believe that it may actually work and if “the proof is in the pudding” which the diary of course reveals…
Early on in the book Rae introduces us to the concept of “the Pin Bar”, the magic candle which very often appears at key support and resistance levels. This is a potential turning point trigger that I am personally familiar with and so the author is preaching to the converted on this one. But perhaps, as I am “of the faith” (TA that is!) it may be worth noting a couple of other points. The first is that amid all the heat and noise of the FX markets, even if you are looking for such a technical trigger as the Pin Bar you simply may not feel that other factors such as a market being overbought or oversold, back the idea of a trade at that time – Rae details in his diary what happened next in many cases. The second is even with the best strategy in the world there will be times when there are the three, four or five losers in a row that may cause you to abandon the method entirely, again Rae details what happened when he stuck to his plan (this also has read through to the special feature on dealing with drawdowns in this issue).
As someone who could, and perhaps should, write a book like Rae’s myself, I thus do appreciate his clarity, expertise and above all, desire to simplify what is a very complex area. Ironically, although he suggests that this is not a book aimed at the beginner, this is exactly the type of book I would have wanted to read when I was starting as it could have saved me months or even years of wasting time on dead end methods. This is especially so now where courtesy of the internet we are overloaded with ideas and “gurus”. My advice – bin them and read this book!
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