Books are a great source of knowledge. That’s the good news. The bad news is there are so many to choose from! As you begin to build your trading library I would encourage you to welcome all new ideas but only accept those techniques that you can independently validate. Although you can read a good trading idea it doesn't mean that you'll be able to use it as well as the author. You have to find for yourself those trading tools that will fit comfortably in your hands, not someone else's. If you can do that then you will be well on your way. The books I would recommend traders to read include:

Trading the SPI by Brent Penfold
Well you can’t blame me! Ignoring my self promotion this is seriously a good book. It is a best seller for John Wiley. Ignore the titled as trading is trading and a chart is a chart. In this book I fully explain how I mechanically trade short-term price patterns. I should also say that I’m one of the few presenters at the Trader Expos throughout Australia and Asia who actually reveal real time results. In Chapter 21 I clearly explain how I do it.

In addition the book outlines the 6 essential steps I believe all successful traders must navigate before they even consider placing their first order. It outlines the importance of being process-orientated in trading (regardless of whether one has a preference for discretionary or mechanical trading). The book takes the reader through the nut and bolts of practical trading covering key concepts such Risk-of-Ruin, (my) Holy Grail, Expectancy, Opportunities, Validation, T.E.S.T, Money Management, Methodology and Psychology. The chapter on Money Management alone is worth the price of the book. Once you learn where I place the importance of Money Management you'll understand why it's the largest chapter. In my opinion I don't believe you'll find another book so accessible to the average reader (who isn't armed with a PhD in mathematics) that has such a breath of examination and depth of practical investigation into five different money management strategies. 

You can read more at the following link:
http://www.indextrader.com.au/Book_Trading_The_SPI.asp

Motivational Books
Reminiscences of a Stock Operator by Edwin Lefevre
I was given my first copy in 1983 by our dealing room’s Treasurer when I was a trainee institutional dealer at Bank America. I've been hooked on the markets ever since. It’s a classic and a must have for every trader.

Market Wizards by Jack Schwager
The New Market Wizards by Jack Schwager
Stock Market Wizards by Jack Schwager
These three books are becoming classics as they contain interviews with people who have succeeded at trading. So when you’re in the dumps you can always read a few chapters to remind yourself that trading is not impossible as there are people who have succeeded at it.

All Round Books
Trade for a Living by Alexander Elder
Trade Your Way To Financial Freedom by Van Tharp
These are both excellent all round books dealing with methodology, money management and psychology. I would also place my Trading The SPI book in this category and I will say here that I do disagree with both authors on a number of issues. However having said that, if you read all three books you would be truly well rounded in what is required to succeed.

Discretionary Trading
PPS Trading System by Curtis Arnold
Curits Arnold presents a simple methodology for discretionary trading. His system looks to trade congestion breakouts in the direction of the trend. If you’ll still looking for a discretionary methodology that works then I can recommend you read this book.

Mechanical Trading
Long-term Secrets To Short-Term Trading by Larry Williams
I don’t know of another trader/author who will give you as many new ideas as Larry Williams does. He is the master of short-term pattern trading and he is the real deal. I have personally watch Larry trade live while he teaches which is no easy task.

Way of the Turtle by Curtis Faith
If you haven’t heard of the Turtles then you’ll need to read Jack Schwager’s Market Wizards. Curtis Faith was one of the original and most successful turtles in program. His book shares a rare insight into what is required to succeed with mechanical trading.