The Market Makers Edge
Josh Lukeman was a successful NASDAQ Market Maker at Morgan Stanley Dean Witter and he is also the author of The Market Maker’s Edge. A 293 page book full of trading skills and knowledge that Josh passes on to you in this publication.
This book has 8 main sections that contain 23 chapters that will teach how to trade like a Professional Market Maker. Josh stresses the point that to be successful trader you must have an effective trading plan. This book will provide you with a plan for many of the trading dilemmas that most traders face on a daily occurrence.
I (Jamey Richardson) have been studying and trading markets for over 20 years. I have read many books and have watched thousands of videos on trading. The Market Maker’s Edge (affiliate) is one of my favorite trading books. This book review will provide an overview of each section of the book. I hope this overview will inform you of some of the information that is available to you if you should decide to purchase this book.
Section 1 — Risk Control
In this section of the book you will learn 5 steps to help you determine the proper position size that you should take in a trade. Josh also teaches how to use different types of orders for taking losses and for taking profit.
Section 2 — Underlying Conditions
In this section Josh teaches you that spotting the trend is the key to profits. He explains the “momentum of a trend” and how to use different time periods for tracking the trend. He also teaches you different “trading signals” that are necessary for spotting a trend in motion.
Section 3 — Fundamentals
This section covers the different fundamental catalyst found in the markets. You will learn how earnings surprises and cash flow of a company can greatly affect the price of its stock. He also covers the different economic indicators and how they will impact the markets for the good or the bad.
Section 4 — The trade
In Section 4 you will learn how to properly entry and exit a trade. You will learn “The Sweet Spot” for entering a trade and how to scale into your entry. You will also learn how to scale out of a trade and how to maximize your gains.
Section 5 — Technical Analysis
Section 5 teaches you the formation of candlesticks and how to trade candlestick charts. He also covers many of the popular candlestick chart patterns such as Dojis, Engulfing Patterns, Hammers, Shooting Stars, Evening Stars, Morning Stars and also Spinning Tops. In this section you will learn about the importance of Support and Resistance Levels. Next is basic Chart Patterns which include Breakouts and Breakdowns, Double Bottom Patterns and Double Top Patterns. Josh now moves into the different indicators like Bollinger Bands, MACD, Stochastic and RSI. He instructs you on when you should and should not use these indicators.
Section 6 — The Pulse of the Market
In this section of the book Josh explains in great detail how to use Volume in trading stocks. He then moves into other leading indicators such as the Tick and the Trend.
Section 7 — Advanced Training Tactics
At this point in the book he teaches you how to trade advanced chart patterns such as the “dead cat bounce”. He also teaches the technique of trading gaps. Some of the gap trades listed are the Breakaway Gap, Continuation Gap, Exhaustion Gap and Artificial Gap. Next you learn how to trade special events such as the Earnings Announcements, Stock Splits, Secondary Offerings and IPO’s.
Section 8 — Psychology
In the last section Josh teaches how psychology and emotional factors from your childhood can affect your trading. He also covers how greed for many traders can be an obstacle. The last pages of the book are dedicated to the conclusion.
If you would like check pricing on The Market Maker’s Edge or other Trading Books, Trading Videos or Trading Systems then please visit my website: marketmakersedge.com (affiliate link)
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