There go the spinning tops and ichimoku clouds!
As I have started to become consistently profitable, I have begun to notice the subtle wisdom in the comments of professional traders that I never noticed before.
A lot of people come into the market looking for the holy grail or the silver bullet that will solve all their financial problems. After all, how hard can it be? You just install a couple programs on your computer or log into a website, and make some money.
Nothing could be further from the truth.
I am probably one of the few people who will say that there IS a holy grail in trading. The only problem is that it is different for everyone and it can change. So how does one go about finding their grail? Again, that just depends on where you are starting from, your past experiences, your personality, etc.
Based on what I have learned so far, here are some things that you should keep in mind if you are struggling to become consistently profitable:
- Do what works for you - Just because Mr. Bigswingingdick makes $10 billion a year trading the SuckerPunch method, doesn’t mean that it will work for you. Demo trade it, backtest it, smack it up, flip it, rub it down. Trade and test it honestly for a couple months. If it doesn’t work for you, see if you can improve it. If not, move on.
- Make sure someone is trading the system very profitably – It is a lot easier to take a system that has been proven to work and tweak it to your personality than to build one from the ground up or improve on one that is based on a faulty premise. Always question the source.
- Expose yourself to as many different trading styles as possible – I’m not advocating random system jumping, but even if you already have a profitable strategy, a couple new ideas could add quite a few percentage points to your bottom line. If you aren’t profitable, then I would suggest looking at trading styles that are proven to be profitable and appeal to you first, regardless of the rules. If the idea excites you, then it is likely it fits your personality.
- Take into account your time available – Don’t have a lot of time to trade, then only trade in small time blocks or use a long term strategy. Like to trade all the time? Then day trading may be for you or trading several different swing systems.
- Take your personality into account – Are you always moody, tired or depressed? Then Zoloft may help. For all other personalities, trade accordingly. One of the best books on personality types that I have ever read is “Poker, Sex and Dying.” It may help you figure out what is going on in your head.
- When it doubt, throw it ALL out – For years, I was doing basically the same thing and well, getting the same results. Luckily, I was trading well enough to break even but I wasn’t consistently profitable. Only after I threw out rigid money management rules and indicators did I start to make money.
- It should be fun – You are going to have a loooong life if you don’t enjoy what you are doing. Hey, trading may not be for you. You may find wealth and happiness in underwater basket weaving. To me, trading is the best business in the world but always remember that it may not be the case for you. However, if you are convinced that trading is your calling, then find a way to make it fun. Pick a style that you find enjoyable. I would suggest reading or listening to Anthony Robbins material on Quality Quantifiers. It is a way of making even mundane tasks more interesting and fun tasks even more exciting!
Of course I’m not trading for a living yet, but these are my observations so far. If you have anything to add, feel free to leave a comment below!
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Hehe. I’m looking for the HOLY GRAIL!! Hope all is well with you. FAP Turbo expert settings have seen better days. Lots of profitable trades but the drawdowns are HUGE. I’ve seen a lot of the drawdowns turn around and make 10-15 pips but the stops are set for 5-10 times the amount. The occassional drawdown can literally kill a week of “good” trades. Haven’t checked out the new pair that they sent out yet, maybe do that over the weekend
What kind of time blocks do you trade in and how do you manage to trade around your job? I am about to start working a job that is flexible with hours, but is 40 hours a week and any input would be extremely helpful.
For me it’s a little easier to trade because my timezone catches London and some of NY, so I just stay up from about 10pm to 2am my time. When I am at work I could trade if I wanted to but the market is usually dead so I usually just take a peek but I don’t really trade.