I am sorry to confuse you.
We hear terms like, Join the Bull side or the Bear side!
What “we” hear doesn’t matter. What “we” [B]think[/B] does matter.
Ok, we know that it isn’t that simple, we should after all join the winning side.
If you start thinking further, “we” can never win. Only some of “we” can win. The others have to lose because that’s why there are winners.
But what is the point… we try to go with the market, we try to follow the trend, and the trend, is what traders are doing right?
Well, some people, most of them, are copycats. That’s why they lose. The question is not to follow a trend. The question is WHEN you will have your entry in that new trend and WHAT is really a tradeable trend? That must be not too soon and not too late and you have to identify what is a tradeable trend.
We are following the same demand of other traders, if most people are following the Bullish or Bearish trend how come… most people loose?
Where is the leaking point in this “Apparent” Zero SUm game?
Every system based on human thinking has a leaking point, because there is no ultimative system. Though, I am afraid, you have to search on your own. If anybody would find such a leaking point, why would he/she share his/her info? It’s like with the tax system. If he/she would tell a leaking point to others, government would close that leaking point.
I can just tell you, it’s much easier to find that point with a computer than with manual trading, because a computer is more accurate, can work day and night and via backtest can check trades over years in minutes.
Though, at first you need an idea where to search …
Maybe I found such a point, but right now I am not sure. I just let my machine trade and in a couple of years I will see or not see. Because I would stop trading if my profit would run out of my account. So, I can’t lose that way. I can only win: Money or/and education. I’m playing with the “casinos” money right now.
edit: To maybe clarify a thing: The markets system is the representation of mass people emotions. Mass people emotions repeat in a way of trade patterns. So, you have to do two things:
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Stay away from the mass trading emotions (the mass always loses), their rules, their beliefs.
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Find a way to use probabilities and mass trading patterns to generate a proper trading signal and then to trade on that signal of your own.
This is in my opinion the only way to be a consistent winner over time and space.
One example: If you look at another trading market, you can park your truck anywhere in front of a restaurant. There will be times in the morning, when people rush to get their breakfast. Thereafter the restaurant is almost empty. Then there is lunch, calm afternoon following. Busy in the evening again. All time around? Nope. Some times may be more busy than others, because ppl get money, travel at weekends and so on.
That same thing is valid for every market. It is valid for Forex as well. If you can identify which patterns make ppls emotions grow and buy or sell, you can use that for a signal to act on that.
Though, that is valid for a small account. If your account grows as big as the big sharks, you might act counter trend. Because you move the market or a big part of it. If you buy, the price goes up. If you sell, the price goes down.
Right now I am a very small trader, so that is just a thing to think about in the very far future, if ever.