Chapter 5. The Art of Trading

"Nothing endures but change." When ancient Greece thrived, Heraclitus developed his philosophies about the universe and the central role of change to it. He understood that change is one aspect of life that is predictable and certain. That is, over time nothing earthly remains the same. The rule clearly applies to financial markets. They are dynamic and challenging. Every day brings new developments and new difficulties. Bull and bear markets come and go, and successful traders must accept that reality and deal with it effectively.

Trading is an art and not a science—that is why it is so challenging and downright difficult. Winning traders must constantly measure, gauge, compare, and evaluate. The financial markets are vibrant. By their very nature they are continuously in a state of flux. Therefore, winning traders must adapt and change with them. Winners must also continue to educate themselves and learn new strategies, new techniques, and new approaches. There is no simple rule to follow or program to execute that will always return a profit. Many traders look for a system or a program that will take the risk out of trading. If you don't already know, let me be the first one to tell you that those systems do not work. They may do well in a bull market, but when consumers lose confidence in the economy and stock prices fall, the system is no longer effective. Or they may do well in some sectors, but may not work if applied to others. No system has ...

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