Why Is The Obvious Not So Obvious?

[JohnnyBGoode]

I agree that this thread is mostly useless for most people.

I agree. To a new trader, this thread seems to dangle the promise of grand enlightenment or profitability, if only they can think through their actions with enough clarity.

And although I believe this thread does lead to certain enlightenment, what it does not do is provide new or struggling traders with what they are really looking for, which is a simple answer or magic formula (because none exists).

Early on the OP asks traders to think deeply about their actions and also describes "the obvious" as being so obvious, most people would discount the information as worthless. OP also mentions in order to be profitable, one trader needs to be able to "leapfrog in front of other traders". (page 6).

Stated another way, in order to be profitable as a trader, you really only need to be able to do one thing: sell your position to another trader for more than what you paid for it! (...seems like worthless info huh?)

To expand this a little further, it would be wise to seriously ask yourself if your trading method gives you a reasonable expectation of accomplishing the above. It does not matter if you use a 5-Min chart, 1H chart, 4H chart, 1D chart, pure fundamental or technical analysis, trend following, combinations of indicators, new releases or chat rooms... If your method does not give you a reasonable expectation of being able to sell your position to another trader for more money, you will not be profitable!

I encourage you to think about why famous and successful traders are able to sell (or cover) their positions profitably. How are they able to increase the probability of doing so? There is no one correct answer here either! What makes high frequency traders successful is not what makes chatroom traders successful. The only constant is that their trading method gives them a reasonable expectation of being able to sell or cover their position profitably.

 

[Vindago]

I agree that this thread is mostly useless for most people. Those who claim to know the answer have rather hostile posts towards the people who dont know it and i really dont like that. Let me give you perhaps the best analogy of what the "obvious" is or what "my obvious" is.

Basically what you are looking for is why does the market behave the way it does. Once you know that, you will be able to position yourself on the profitable side more often than not.

Lets imagine it's a very sunny day without any clouds. One hour later it's a severe thunderstorm with heavy rain. Going from sunny weather to stormy weather is the same as going from an uptrend to a downtrend. The forces that cause the rain to fall are the same forces that cause price to collapse. Works the same if we are going from a downtrend to an uptrend. Hence why some say "as above, so below".

This basically means that an uptrend is literally the same as a downtrend, only with different polarity. Think in terms of events and probabilities and specifically conditional probability.

What do you wear when it's sunny? Maybe a tshirt, sunglasses, a hat, light clothing in general and in more extreme cases protective gear against the sun. What do you wear when it's raining? Maybe an umbrella, a pancho, a jacket since the temperature may be lower.

How do you know that the weather is changing from sunny to stormy? First you start seeing some clouds, then the clouds become more dense. Then they become darker, maybe you see a lightening. These are events, after each event you get a new (conditional) probability of whether it is more likely to start raining or not. Once the sun is completely out, you are probably gonna take your hat and sunglasses off. Once you start hearing thunder, you will probably want to be near an umbrella. Once it starts raining you use your umbrella until it stops raining.

That's the weather cycle and how we should approach it if we wanna stay comfortable in sunny and rainy weather. The same is true about the market.

Very good analogy, I like it. I would add that when the weather start changing often, for some time, there is some uncertainty, for a time it is variable, it may rain and be sunny at the same time
other times, it may just be a passing cloud or it may rain for a few hours, or in more extreme cases we may even have a change in the season so that the summer most generally sunny weather become autumn with its heavy rains and this change does not happen immediately, it will take some time for the change of season to take effect.
So the weather is crucial but also the time factor is important and is a very critical indicator

 

[Wide Tailz]

I've never seen anything which suggests trading success from those who claims to know the obvious. Yet, people are still trying to solve the riddles of this thread instead of solving the markets.

I assure you there is something here in the first ~30 pages of the thread that is so obvious and hidden in plain sight that (speaking only for myself) if applied, can definitely help a struggling trader stay on the right side of the market. My rate of losing money has gone from -30% a year to -5% just based on this knowledge alone. Take it for what it is. For me, it's the least worst option for discretionary trading, but I need to learn to let winners run and the obvious works with that, too.

 

[Ed48]

Stated another way, in order to be profitable as a trader, you really only need to be able to do one thing: sell your position to another trader for more than what you paid for it! (...seems like worthless info huh?)

To expand this a little further, it would be wise to seriously ask yourself if your trading method gives you a reasonable expectation of accomplishing the above. It does not matter if you use a 5-Min chart, 1H chart, 4H chart, 1D chart, pure fundamental or technical analysis, trend following, combinations of indicators, new releases or chat rooms... If your method does not give you a reasonable expectation of being able to sell your position to another trader for more money, you will not be profitable!

IMO, this IS precisely the "obvious" that the OP was referring to.

The "obvious pre-requisite to [successfully] trading any market", is finding a method (an XYZ) which works. If you do XYZ, and keep doing XYZ, it will make money.

That is why the OP was dismissive of risk management and position sizing. These are of little use if you don't have a proven XYZ.

 

[The Obvious]

Yes, this is indeed the obvious.

Now we just need to find the holy grail XYZ.

Many will read this and say this idiot is playing mind games, or trying to sell something - but what else would they say, as they are frustrated that they have not been able to come up with the so called "holy grail" of trading, as it does indeed exist, but only for a very very small minority!

3) Idiots will always back up other idiots who think they have it cracked, but the reality is that they are still idiots and will never get anywhere near the real "holy grail" of trading, which does exist for the very small minority.

I will go as far as I can go - but I will not ever disclose the real "holy grail" of trading, for obvious reasons.

 

[benten]

Now we just need to find the holy grail XYZ.

Good one!

 

[Aj2014]

What's obvious is that the obvious is not obvious to all. Although it is indeed obvious. The obvious is obvious. But it's not.

I hope i've not given too much away there. Wouldn't want it to stop working! You're welcome

 

[Ed48]

Was the OP messing with people when they said the holy grail of trading does exist but only for a very very small minority?

Even if it is only known by a very very small minority, it would be hard to keep secret.

 

[Vindago]

Was the OP messing with people when they said the holy grail of trading does exist but only for a very very small minority?

Even if it is only known by a very very small minority, it would be hard to keep secret.

It wouldn't matter, as the Op said once: "I could tell the obvious and it would be discounted".
Moreover, the hard part of a successful trading method is being consistent in using it, it is enough to screw up once to easily burn a week earnings.

 

[Mysteron]