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The Importance Of Exits

The vast majority of traders I have encountered are searching for the right tool or strategy to help them identify the correct area and direction to ENTER a trade.

Many resources available to a trader, even those few that are actually worth looking at, are focused on identifying a price to open a position. If action "A" happens then do action "B".

This is often a procedure that is developed by the designer looking at things that have happened in the past and expecting them to repeat.

The problem is that the market is an ongoing auction that is constantly trying to discover a price that everybody can agree on.

Thus, any expectation of an exact repeat of what happened in the past is going to lead a trader into a completely random situation that will often result in their money being taken by the market regardless if they had the correct entry area or not.

Even if a trader is a master at finding the correct areas of support and resistance, the way that the price reacts to that area will be different in each individual situation.

It is true that areas of support and resistance tend to hold upon an initial test. However, the manner in which the price respects the zone will be different each time.

 
About Me



Trader of stock index and commodity futures.

Trading technique is structure and liquidity based without the use of indicators or rule based systems. 

I started publicly sharing my trading journey in early 2009 and now am going to take what I have learned and use it it help the few out there who are truly committed to trading for a living make it a reality.  I did not have a source with this level of honesty and clarity when I began my journey. 

I have made just about every mistake that can be made along the way which has allowed me to become proficient at this craft.  I talk about the issues and roadblocks in trading that remain unspoken anywhere else that can be found online.  

It is not enough to be able to make calls, identify patterns, and measure risk.  A successful trader must simply be better than most others.  Accomplishing this requires hard work, guidance, and constant drilling in the live action. 

Interests include aviation, motorcycles, RC helicopters, running, tennis, and history. 

I beleive in exceptional-ism, honesty, and personal accountability. 

 
The Winning Argument

Trading will often take you to your breaking point and then present the opportunity you were looking for once you have given up.

This is the rotation that most traders are trapped in.  Hitting all their losers and scratching or passing on most of their would be winners.

These occurrences are no coincidence.  The market is designed to do this.  This is how a live auction comes to a fair price.  Everybody is competing at once to find an edge.

There are many participants with varying agendas running a countless number of strategies at any given time.  The price is rarely going to do what you want it to.  If it did, there would be no price efficiency and price would tend to perpetually move in one direction.

This makes even the best hindsight or paper strategy completely ineffective without an experienced speculator driving the decisions.  Profitable trading day in and day out comes down a trader being able to use their feel and experiences to quickly adapt to what they see.  This is not avoidable.  Many will try to convince you otherwise but it is just simply not true.

How many have purchased a system from a website that shows consistent profits when back tested?  I know I did.  I purchased a system that even produced what looked like winning entries in real time.  The seller of this system was artfully "calling" out entries and exits and booking "spread sheet" profits.  Purporting to be trading live.

When I tried to trade the system with real capital I got chopped up.  Guess what happened.  I missed entering most of the winners by a tick or two and hit all my losers.  Most of the winning trades I did enter ended up being scratched due the the fixed management style that the seller of this system endorsed.