Are there any other people here who have been at this for a LONG time and are still not really any
further than when they first tried?!!
Lets say, at least 3-4 years of FULL DAYS practicing/studying/starring at charts till your eyes bleed/demo trading/live trading etc.
I find it hard to believe that it's actually possible to succeed at this 'long term' coming at it from a charting angle (which is what i've always tried)
(I know of a few legitimate/rich traders who advise against charts/Technical Analysis/price action etc)
I've had spells of success over the last 5 years or so, but in hindsight, It was just luck.
The market is good at fooling you into thinking you have an 'edge'.
Even with 'context', chart patterns tend to 'work' as much as they don't.
I feel slightly alone, though.
I'm sure there's others out there (the current state of the pnl thread would suggest so, compared to the olden days), but even with the anonymity of the internet, some might
be too embarrassed to admit such failings.
I'd like to hear from anyone else in a similar situation, your story in bried, your conclusions, and your plans going forward.
thanks
OK let me spell out what is going wrong for you and more importantly why. You are not alone, the vast majority of retail traders are losing money week in week out. I was once in your situation, I feel your pain.
To state the obvious you are trading without a solid edge. Please don't take this personally but I don't think you have the necessary understanding of the market you are trading, the participants who trade it and how/why they operate. This information will help you find your edge.
Here are a few of the types of traders in your market that you need to understand:
- Utility traders - Investors, Asset Exchangers, Hedgers, Newbie Traders
- Speculators - Informed, Uninformed, Value Traders, News Traders, Arbitrageurs, Stat Arbers, Order Anticipators, Front runners, Manipulators, Block Traders (inc Brokers), Losing Traders, Gamblers.
I have a handful of core edges (strategies) that I trade, it's always good to have several as edges can stop working. For each of my edges I know which category of trader I am and I know WHY the edge works.
For each trade strategy you have to ask yourself what advantage you have over all the other types of traders in the market you are trading. This is a negative sum game. That is your winnings must be offset by someone else losing. There isn't much room to maneuver as the traders doing the bulk of the volume are highly educated, fast and have minimal transactions costs. If I was looking for an edge to get started I would aim for one of the following:
- Look to identify situations where traders have to act or are very likely to act and front run them (not all front running is illegal).
- Find or construct a highly co-integrated instrument and trade it based on value.
So once you understand all of the above thoroughly and have completed your homework you then need to find your edge. You need to test it thoroughly and you need to be able to execute it with minimal transaction costs relative to your average tick win/loss.
Now even if you manage to get this far you now need to execute your edge with consistency. As you are human this can be remarkable hard. Humans are very bad at following rigid plans, they find ways to mess up. You need to find a way to follow your own rules, something which most cannot do. Most retails traders are in a constant state of emotional mess being dragged this way and that by fear of losing, fear of missing out, fear of being wrong, fear of leaving money on the table. The absolute worst position a trader can be in imo is staring at a chart taking discretionary entries, watching price move up and down, looking for patterns on the hoof, shall I enter, shant I, then click they are in.
All the above is why trading is so hard. People will just not put the work in to succeed. In most cases it is because they don't know what work they have to do. This is why otherwise very successful bright people like scientists (that was me lol), doctors, engineers, lawyers etc. start trading and blow up because they have the mindset that all they have to do is study the theory and voila, turn the wheel and out pops money. Trading doesn't work like that. There is no manual or standard textbook on how to find an edge. It should be clear to you from the above why there is no manual and why there will never be such a manual.
You wrote '
I find it hard to believe that it's actually possible to succeed at this 'long term' coming at it from a charting angle'. Hopefully you now understand charting is not the problem. You need to be very careful with charts as humans are very prone to bias when looking at charts. You can use this to your advantage.
I wish you good luck.
