Come into My Trading Room- by Dr Alexander Elder

The author is a professional trader and a practicing psychiatrist. Obviously, he focuses on the psychology of trading and the mental reasons why traders either thrive or they are habitual losers. He uses a methodical approach to the trading and has developed his own system and achieved winning consistency through it.

The title Come Into My Trading Room clearly tells us what the book is all about. Dr. Elder is a professional trader and he explains the trading system that he uses and the money management principles that are necessary to succeed in trading. Many people buy trading books solely for a revelation of the latest and greatest trading system. However, I believe that his discussion of the mental aspects of trading may be the most important information in the book.
It is all about the decision making system. It also puts lots of emphasize on the discipline part.
Trading is about understanding the market. So the author has explained swing trading, positions and trend trading in a very descriptive and appealing manner.

Psychology of Trading
According to the author, many traders fail because they dont follow some basic rules of trading. Many traders take a lot of excitement in the process of trading. With this approach they will overtrade or they become under-capitalized and many times it happens that they dont respect the risks involved.

Having analyzed many amateur and professional traders, I think he has put forward the traders behavior it the right sense. Dr. Elder gives a good summary of the characteristics of winning traders and losing traders along with several day to day examples. He also explains the journey from novice trader to professional trader. However, most will never achieve that level - the reasons why are explained throughout the book.
The best part is he is the author who makes his living out of trading. Many authors write about trading commodities and futures and have little experience or success in trading. The more I trade, the more I realize the importance of the mental aspect of trading. Dr. Elder is considered one of the experts in this area and his education and advice in this book might help many would-be and struggling traders.

The author gives sufficient reasoning on why he uses the same system.
Dr. Elder developed his trading system many years ago and still trades the same basic system Triple Screen. In this book, he describes the system and some of the modification he made to improve it. I like the fact that he developed a system that works and he sticks with it, while fine-tuning it along the way. Better yet, he claims this is what he uses to trade and he isnt with holding any secrets on his methods.

Triple Screen Trading System
The Triple Screen System uses a longer-term trend following technique and a shorter-term overbought/oversold indicator to time the trades. In essence, you will use a weekly chart to establish the direction of the trend you should only take trades in this direction. Next, you use a daily chart where you will use an oscillator to give you overbought and oversold readings. Then, you can use a 60-minute chart to buy or sell on breakouts in the direction of the overall trend.

The good part about this system is that you can use any timeframes that you like to suit your trading style. The author recommends spreading out the timeframe by a factor of five.

The theory to the whole system is to trade in the direction of the trend and wait for pullbacks within the trend. Then, you enter the trade as the trend resumes. He also discusses using moving averages and channels to find optimum entry and exit areas. You still have to do a lot work with this system to find and manage the trades.
No legitimate trading book would be complete without discussing risk and managing trades. I think he put much more emphasis on risk in this book. His 2 percent and 6 percent rule is a simple, yet sound money management plan. Record keeping of your trades is also a priority in his mind and I couldnt agree more. You can learn a great deal from the history of your trades and many traders dont keep records, because they are lazy or their egos wont allow them.