Introduction: Riding the Trader's Pendulum
All traders ride on a pendulum every day. Unsuccessful traders ride the pendulum back and forth with no real idea of the pendulum's swing. Successful traders recognize that the pendulum swings and ride it mindfully; as a result, they make better decisions and better trades.
The Futile Search for the “Perfect System”
When Peter, one of the clients that I coach, showed me how well versed he had become with his trading skills, I was impressed. Although he was a part-time trader (aspiring to turn trading into his full-time profession), he had gone through the grind to learn about price action, Fibonacci, support and resistance areas, chart patterns, moving averages, and other technical indicators.
Looking at how he understood price action and maneuvered these technical tools, I saw how good he was at reading his charts. His skills were on par with most professional traders; maybe better. Especially considering how busy he was with his day job, I knew he must have burnt the midnight oil on his evenings and weekends to learn them.
However, I could not help frowning a little when he asked me, “What techniques am I still lacking? Do you have a better strategy for me?”
These are typical questions asked by traders. It showed that Peter did not understand what he needed to do to succeed. Or perhaps he was just misguided.
From my experience, most traders are like Peter. They think trading is all about mastering as many technical skills as possible ...