Trading Is a Thinking-Man's Game: WRONG!

Most traders move from trading system to trading system, and over time, until they find one that suits them…

One that is comfortable to run, and tests well over (back-tested, then real) time.

Some traders never stop looking for the "right"system.

THAT is a problem.

There are many systems that can generate nice profits over time. To settle on a trading system that's right for you:

First, you have to believe in the process by which the system generates trades.

Who was Fibonnaci, and how did he arrive at his methodology?

Does it make SENSE to YOU?

Maybe you're a visual sort of person and you are drawn to Candlestick charting. Take the time to understand why the patters mean "reversal" and not just accept the "picture".

Go deep.

Choose a guru that you will need to trust 100%.

If you choose to take your trades from a guru, understand where his or her godliness is coming from.

This can be a dangerous choice in that you are giving up control to another. Choose wisely.

Second, whatever system you decide to go with, Back-test it.

In today's modern world of software, there's no excuse not to run all the back data you can through your system and see what the results would have been.

Although back-testing is no proof of future performance, at least you can see the logic of your system at work.

Third, test your system in the real time.

Take a VERY small amount of risk capital and trade live.

This could be the most valuable phase. Although you won't have "fully-invested" emotions tugging at you, you will feel something, and you can learn to control your emotions as you allow your system to do its' work.

The bottom line to all of this is that if you don't have TOTAL CONFIDENCE in your system before you start trading it, you will doubt your system's ability to perform with every losing streak.

Thinking about your system and its' validity while you are trading it will spell doom.

Do all your thinking in the "pick a system" stage.

Now, when the trading day is over, you should be reviewing your trades… but not your system.

Did I follow my system correctly?

Did I weaken in my resolve to follow my system?

How can I (not my system) improve?

Nobody is saying that you should be sticking to a system that is losing in real time.

What I'm saying is you should only judge your system over the long term…not on a daily or even a weekly basis.

THINK long and hard about what stock or futures or forex speculation is and whether it fits your investment objectives.

THINK about the system you are choosing and why it's right for you.

THINK about the results you get from your back-testing and your real-time testing of your system.

BE A MACHINE (DON'T THINK) when you are trading your system.

This is why I dedicate myself to the mental training of traders.

Unless you can control yourself, you can never control your system.

And in order to control yourself and your emotions, you have to believe totally in your trading system.

Do the work.

Think.

Then don't think.