Why easy is difficult

[helmholtz]

But there's no edge in futures compared to stocks.

Should read short term edge

 

[jnbadger]

Why….

And none of us will eat Ya…

RN

That's good to know. I can just see Donna sharpening a knife while looking at me in a hungry sort of way.

 

[tradingjournals]

Alright, I've rambled enough. Time for a contribution.

Any given Friday... The market is down at the open. A stock opens up on the day and proceeds higher as the market remains weak. (Relative strength)

The stock pulls back hard as the market collapses, but the stock doesn't break its low or it's opening price, and stabilizes as the market falls.

It's hard to buy that falling stock when the market is falling, but volume and price action dictate you buy it immediately.

Not as eloquent as some of you kids, but that's what I do, day after day.

"A friend in need is a friend indeed".

 

[nvroy]

Trading should be easy, at least on paper. You have basic rules, such as buying a breakout and adding as the position progresses.

So what gives?

The subtleties, my friends.

Can you sell your long position, when not stopped out in the conventional manner and not in profit either?

Can you run your profits and suddenly liquidate when price is still going strong if you get a volume indication of the future?

Easy is difficult.

I'd actually like to keep this thread alive, read this phantom's gift some years ago but never really understood what he was saying. Phantom, can you give an example of the above doublespeak and how you'd handle it?

 

[cornix]

Simple? Yes.

Easy? Not at all. Throwing the ball into a basket is simple too, but how many can do it on NBA level?

 

[smallStops]

good way of putting it indeed. One can see the psy pro.

 

[cornix]

good way of putting it indeed. One can see the psy pro.

Thank you, sS.

My view on the problem in more details is that technically simple activity can be both difficult and easy depending on existence of emotional component in the equation so to say.

There are widely known experiments, where people were asked to walk on the moderately narrow plank simply lying on the floor. Most did it without slightest sign of a problem.

But what if the same plank was placed 1 meter above the ground? Far not every participant even agreed to walk it at all. Now imagine if it was placed above the abyss?

Difference in all cases above is just how we perceive it emotionally.

 

[cornix]

To add: of course there is skill involved in many activities as well. Trading is one of them, seemingly very simple, but also very nuanced professions, where "small things" make a difference between overall profit or a loss.

 

[smallStops]

your example of walking across a plank on the ground or at 1 meter high is very instructive. Even myself, I am not sure I will just do it.

I also think that activities like trading do require a lot of "trading" experience,
AND , a very healthy psychology/spirituality. At the end of the day, after the trading experience, it is really a mental game. And with unhealthy psychology/spirituality, one is simply doomed to reflect the unhealthiness in the trading.

 

[cornix]

Yea, how simple is walking a plank 1m above the ground? And how easy?

I agree that psychological problems, especially those related to lack of adequate self-confidence or on opposite, presence of overconfidence lead to dramatic consequences in trading.

One of my favorite books is Soros's "Alchemy of Finance". He always keeps amazing me how easily he admits mistakes. Like there was no ego involved at all. Of course I think what he felt was different, but still, publishing such a detailed information about both successes and failures requires very strong psyche and self-confidence, but not overconfidence.