Three Laws in Trading

Quote from TraderZones:

Quote from alex.samant:

hey. these are 3 laws that are commonly broken by the majority of traders, kinda explaining why the grim statistics with regards to the average success rate of a trader.

1) Nothing that happened in the past (near or far) has the power to influence what will happen in the future (near or far)

WRONG. Indicators, patterns, seasonal trading, price action and other things are almost always used to influence the future

absolutely nothing can influence the future. not one thing.

2) The outcome of your trade will depend 100% on your money management decision based on the present moment

WRONG. Many people exit when their signal flips or suggests getting out. That is not money management, but trade management

since not one thing can influence the future, only how that trade relates to your account is important...ie... risk management

3) Your trading routine has to be part of your life and NOT the other way around

WRONG. This is just a guess on your part.

not so much a guess...he is basically saying not to try to fit a sqaure in a round slot...that's all....
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Quote from alex.samant:

TraderZones.

I appreciate you disagreeing. Everyone is entitled to his or her own opinion, but when you say "WRONG" you imply that your statements are RIGHT and therefore the absolute truth.

By posting the 3 Laws of Trading as if they were the truth, which was really your own opinion, I feel that a rebuttal is very fair.

You could have simply said that you disagree and offer some counterarguments.

You could have said it was your opinion, rather than "Three Laws in Trading" ya know?

I could argue with your reply point by point but i don't really feel like writing so much.

However, please bear in mind that neither you nor me hold the absolute truth.

That was the point of my post. These are not the 3 laws in trading. They are one person's unsubstantiated opinion.
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Quote from ElCubano:

Alex: 1) Nothing that happened in the past (near or far) has the power to influence what will happen in the future (near or far)

Me: WRONG. Indicators, patterns, seasonal trading, price action and other things are almost always used to influence the future

ElCubano absolutely nothing can influence the future. not one thing.

OK, let us test that.

The price of the Dow is 8700. is it more likely to be at 8701 or 3000 one hour from now? The past influences the future

Gasoline tends to rise in price during the summer and heating oil tends to rise in the winter. pretty much every year. The past influences the future

The market moves on expectations about the future - interest rate trend, anticipated jobs reports, expected profits of companies and sectors, sometimes months in advance. The past influences the future

Stocks tend to go up from November to May, and struggle in between. The past influences the future

Trading is based on anticipating near term movements of instruments, be it TA, Pure Price Action, Fundamentals, price patterns. The past influences the future. Otherwise, there is no point trading.

In the future, there will be more elderly, whose buying habits a be predicted. They will be a major strainThe past influences the future

Retailers put in lines of merchandise and clothes for different seasons. Easter Candy, Christmas decorations, Valentines Day candy, St. Patrick's day green stuff. Thanksgiving, etc. The past influences the future

Farmers plant, fertilize, water and reap their crops on a relatively known cycle. The past influences the future.

There will generally be hurricanes hitting the eastern US and the Caribbean, and other part of the world during their particular storm seasons...

The Sahara is desert today. It will be so 10 years from now. The past influences the future

Each year, the GDP grows on average several percent and the stock market and house/land prices tend to go up. The past influences the future

And the list goes on and on.
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Quote from TraderZones:

Quote from ElCubano:


ElCubano absolutely nothing can influence the future. not one thing.

OK, let us test that.

The price of the Dow is 8700. is it more likely to be at 8701 or 3000 one hour from now? The past influences the future

1) Is it more likely to hit 8701 or your stop of 8699.50? nothing happens with 100% certainty...if your stop is 3000 and your target is 8701 then you have more chances of hitting 8701 but one bad hit of 3000 and you are ruined.

Gasoline tends to rise in price during the summer and heating oil tends to rise in the winter. pretty much every year. The past influences the future

2) yes but gas was way higher 10 months ago than it is now....again where YOU enter your trade in relation to that moment in time can be higher or lower than prices in the future. Can you garauntee that prices will go higher?

The market moves on expectations about the future - interest rate trend, anticipated jobs reports, expected profits of companies and sectors, sometimes months in advance. The past influences the future

3) yes but the market can move in either direction so again what good does that influence have on your account if you are not in the right side.

Stocks tend to go up from November to May, and struggle in between. The past influences the future

4)Then why arent you a multi-gazzilloinaire

Trading is based on anticipating near term movements of instruments, be it TA, Pure Price Action, Fundamentals, price patterns. The past influences the future. Otherwise, there is no point trading.

5)anticipating and influence are not the same...

In the future, there will be more elderly, whose buying habits a be predicted. They will be a major strainThe past influences the future

6) lol

Retailers put in lines of merchandise and clothes for different seasons. Easter Candy, Christmas decorations, Valentines Day candy, St. Patrick's day green stuff. Thanksgiving, etc. The past influences the future

7) Oh brother

Farmers plant, fertilize, water and reap their crops on a relatively known cycle. The past influences the future.

There will generally be hurricanes hitting the eastern US and the Caribbean, and other part of the world during their particular storm seasons...

8) yes, but how many will hit miami this year? the past has nothing to do with how many will actually hit...40 can hit this year and then not have 1 hit for 40 years...how does past hurricanes change this randomness?

The Sahara is desert today. It will be so 10 years from now. The past influences the future

9) the past has nothing to do with the fact it is a desert...it just is, past present and future...

Each year, the GDP grows on average several percent and the stock market and house/land prices tend to go up. The past influences the future

10) but you can't gaurantee it...

And the list goes on and on.
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seems that elcubano is the only one who truly undertands what i posted initially.

and yes.... traderzones, i did make a mistake by titling "laws of trading" but that was only to have the attention of more people ....
 
Four simple guides.
Do not risk too much.
Let not your action affect the price.
If it ain't going up don't buy it.
If it ain't going down don't sell it.

The rest is complication or that infamous term "curve fitting".
KIDS... Keep It Damn Simple.
 
Just my opinon. Successful trading is all about making the right decisions. No one can predict the future with certainty so often you are going to be wrong. The right decisions go against human nature and that is why this game is so hard for most.
 
I think when one accepts that he has no control over the outcome and sees trading for what it is.. a way to POSSIBLY make money then they are more ahead of the curve then someone who thinks they can predict the future trough indicator schmindicators....
 
Quote from alex.samant:

hey. these are 3 laws that are commonly broken by the majority of traders, kinda explaining why the grim statistics with regards to the average success rate of a trader.

1) Nothing that happened in the past (near or far) has the power to influence what will happen in the future (near or far)

2) The outcome of your trade will depend 100% on your money management decision based on the present moment

3) Your trading routine has to be part of your life and NOT the other way around


Just a little something to think about .... ;)

Cheers y'all
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I don't agree with numbers 1 and 2. As for number 3, if you are referring to balance, then I agree.
 
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