Thanksgiving - Super Long Post

I think I'm really blessed. I don't know how to describe it but I really do. It has been slightly more than a year and a half since I got introduced into the world of trading. Since then it seems like there has been a divine hand guiding me along the right path. I do not say that because I'm now very profitable or super rich, I say that because it could have been so much worse. I read a lot, and as a result I have come across numerous stories of how so many traders blew their accounts and took years before they became consistently profitable. So many were stuck in the search of the Holy Grail, experimenting indicator after indicator, black box after black box. You know what, everyone who has been down that road knows the outcome, but I personally feel that it is a road everyone cannot avoid. So it is with all the common mistakes that traders often make. Let me give some examples:

1. You'll never know that having 5 indicators and 3 moving averages doesn't work until you've tried it.
2. You'll never know that a $3k black box system doesn't work until you've tried it.
3. You'll never know that disobeying a stop loss is disastrous until you've done it.
4. You'll never know that oversizing on a position is dangerous until you've done it.
5. You'll never know that trading your favourite candlestick pattern whenever it appears doesn't work until you've tried it.
6. You'll never know that trading based on tips or calls by others is stupid until you've done it.

I could go on and on... We read about these common pitfalls and mock at people who commit them, but can you find a trader out there who has never committed them? With the exception of purchasing a black box, I've committed all the others. And I feel blessed, because I have not blew up. So many people blew up 5 digit accounts multiple times before they got it. So many people are still tinkering with indicator settings after years of non profitability. In every course or seminar that I've attended, every forum that I patronize, every facebook group that I'm in, people just crave after tips and tips and tips. They post their trades and then ask if they should take profits or cut loss. To me it just shows that they do not have a trading plan, and to put it bluntly, are bound for failure. They are just in it for the money and they want quick rewards with minimal effort.

I'm really glad that I just love trading for trading and not for the money. There is a quote at the top of my blog that says "The goal is to become the best trader you can be, the money will follow". I really believe in that. If you're in this not for the passion but for the money, there is absolutely 0% chance you'll make it. I really mean it. Trading is not like engineering, teaching, accounting, or any other profession where you'll still be paid monthly even if you suck at your job. If you suck at trading, you're not just not going to make money, you'll lose it, period. 

The secret to being a successful trader often eludes beginner traders because it is dull and unappealing. Yes a good trading strategy is important, but try talking to a beginner about discipline, money management, psychology, power of compounding etc. It is impossible for them to appreciate it, simply because there is too much to learn all at once and it is natural to be drawn to trading methods initially. There is nothing wrong with that, all of us start that way, I know I sure did. Whats wrong is not progressing, is repeating the same mistakes, is continually focusing on methods and not other aspects of trading.

And so, while I'm far from being successful, I'm grateful that I've learned what took many others years to learn. I'm referring to the search of the Holy Grail, which I've come to realize resides not in methods but in self mastery. I'm at the stage where I think I've sufficient knowledge about trading strategies to at least not lose money, it is now about continual improvement, discipline, psychology, money management, and self mastery.

Methods wise, I'm grateful that it didn't take me long before I stumbled upon Wyckoff, VSA, and price action. I believe that in the long run my methods will purely be price action based, but Wyckoff and VSA really helped me understand how the markets work and opened my eyes to how it is all about supply and demand. The thought that I could still be meddling with indicator combinations and different systems freak me out, and I'm so glad I didn't go down that route.

I'm also grateful that I started trading Forex. You have no no idea how much that changed everything. Yes I haven't started for long, but already I can see how not having to pay a minimum comms can open the door to important trading strategies that I cannot implement on equities due to my pathetic trading size. Partial exits are just so important, but if I do that on equities my comms will literally balloon. Simple example, if I make a trade on IG markets and decide to take partial profits and trail the rest until it is stopped out, I'll incur a min comms of $45 ($15 per trade). That is A LOT for my trade size. I can do the same thing on FOREX for $0 min comms, see the difference? I can also trade real small and focus on achieving consistency before increasing my size. In equities I can't do so because of the min comms. There are also so much more useful resources and forums on Forex. I so wish I had started it earlier. 

Oh ya one more thing. I'm glad that trading is a business where everyone is bound to fail at the start regardless of how high his IQ is. High IQ people are used to top grades and a sense of control over their profession, as such it is hard for them to accept the probabilistic nature of the markets. They can read lots of books and derive a top A+ setup, but when it fails they simply cannot accept it. All their lives they're used to things going their way but that's just not how Mr Market works. As such I'm glad that I'm on level playing field with these guys, just because they're smarter doesn't mean they'll fare better than me. If I can have better discipline and psychology than them, I'll trump them.

I am also grateful for my beloved wife who has been so patient and understanding, who always tries to accommodate me and put up with the excessive hours I spend in front of the computer or books. Sometimes I set my alarm to wake up in the wee hours and watch how the US market closes but she doesn't bark about that either.

Wow this is a long post isn't it? I guess it is meant as a diary post for me to pen down the plethora of thoughts swimming in my head. I got into a very introspective mood after reading some James16 posts. This guy is for real, I really respect his contributions to price action and I admire his generosity. I'm only few pages into his thread and a couple of his videos but already I've learned quite a few interesting stuff. Here are the posts (non trading related) that for some reason brought goosebumps to me:

http://www.forexfactory.com/showthread.php?p=84617#post84617
http://www.forexfactory.com/showthread.php?p=4005559#post4005559