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Quoting: All these people succeed because: Their strategy is based on a real advantage, one that relies on exploiting recurring inefficiencies in price behavior. They accept losses and come out quickly from them (while novices try to avoid them or recover emotionally from them
Exactly, that's it... I wish the others, especially the new ones, would stop opening threads looking for the holy grail or at least be more creative with the titles for that "eternal search." And since we are, the title of this thread could be answered as: "search for eternal life"...
Quoting: All these people succeed because: ...... Excellent post. I laughed, but with respect.
"Real advantage" = is based on exploiting recurring inefficiencies in price behavior. Look at the graphics, look at them again... and again... until you see something that is repeated. If there is news impact, as it happens in this forum, that can give clues. Keep the graphics clean, you don't need to fill with lines all. The price will move without importing your drawings. Thousands of hours in front of the chart and trading becomes relatively simple... but only when you find YOUR advantage. The sad thing is that it can take years to identify your advantage and believe in it. And the saddest thing: it has to be yours. It doesn't help to take any system of a thread and copy it. It can inspire you, but it won't belong to you. When you know your advantage and its probability, calculating optimal leverage is easy. I adjust it with the consecutive losses expected and the drawdown maximum. And then you will sleep calmly. "Domin your system". But in the end it's just about playing with your advantages. The price is not going to stop just because you put on a daily.
"Recurring inefficiencies in price behavior"... what exactly does that mean?
Quoting: "Recurring inefficiencies in price behavior"... what does that mean exactly? Good question. To answer it you have to define what is efficiency. There are many ways to see it, we would need pages. Inefficiency is related to the advantage in trading. For example, many use mobile media as a way of measuring efficiency, and deviations as inefficiency. A simpler example: Renko graphics. They have a statistical property: the probability of continuation and reversal can be calculated. A typical Renko graph has a 2:1 ratio in favor of continuation. That means that, in theory, 2 out of 3 blocks are of continuation and 1 of reversal. If in practice the continuation blocks are more than 66%, you can say that that that this time frame is inefficient, more trend-wise than normal. If they are less than 66%, then the market is more efficient in trend, but more inefficient in reversion. Once you detect that inefficiency, the challenge is to turn it into a cost-effective and sustainable strategy that covers trading costs. I hope that this will help.
Great post. I wish they would have engraved points 2 and 6 on my head when I started. I’m like a dog chasing cars.
Quoting: "Recurring inefficiencies in price behavior"... what does that mean? That is your advantage, and it must be based on the movement of price, not on managing money or inventions like martingala. For example: if on Friday at the close there is a big Gap in the GER30 and on Monday it opens with low liquidity, the day can end up in an alcista or bassist candle with a certain probability. Why? Because that Gap was created when there was no volume. Maybe there was war, catastrophe or a ridiculous declaration from a central banker. Mondays have low volume, and can be easily manipulated. Is it a fixed rule? No. But if Y > 50%, you already have something. Another widely used example (although it does not always serve)
The majority of those who seek the "holy grail" what they want is an excuse not to think. Something that tells them "buy here and win", effortlessly, without analysis, without suffering. But that does not exist. It never existed. And the faster you understand, the faster you can work on a real advantage. Because yes, there are winners, but not because they have magic, but because they repeat themselves a profitable routine until tiredness.
The problem of many is that they are more busy finding the perfect indicator than understanding the market. They click on everything that shines like gold. But if you don’t understand why the price moves, it doesn’t matter how many oscillators you put. You’re going to keep coming in late and coming out worse.
Patience? I also want to buy a lot of that. The bad news is that it’s not on MetaTrader and it’s not achieved on Amazon. It’s only earned on the basis of shit. Because, yes, after the market breaks you 40 times for anxiety, you start to think that maybe... just maybe... you should have waited longer.
We all go through that phase of believing that there is the secret button that activates money. It’s almost inevitable. They sell you smoke, and you inhale it with taste. The good thing is that when you wake up, you start to see the game differently. And that’s when the real learning begins.
It's funny how everyone wants a system with 90% effectiveness, but they're not willing to take two weeks of drawdown. That's not looking for profitability, that's looking for magic. And in trading, as in life, magic only exists for those who work as if they don't need it.
Every time I see someone looking for the holy grail I remember when I too believed that the problem was strategy. It wasn't that. It was me. Because any moderately decent system can yield results if you apply it rigorously. But if you change the method every week, then you'll never see fruit.
Having an advantage is like having a sharp knife. If you know how to use it, you do wonders. Otherwise, you cut yourself. It's that simple. And no one is born knowing how to use the knife. You have to cut many times badly to learn. But if every day you change tools, you never learn anything.
If you see a strategy posted on a forum with 50 indicators, run. And if it promises you constant daily profits, run faster. They're taking you for a fool. Cost-effective trading doesn't need ornaments. It needs structure, repetition and a lot of cold head. It doesn't have anything sexy, and a lot of monotonous.
I've seen people destroy accounts with systems that, in theory, were "winners." And I've seen others make fortune with a simple moving mean. The difference? The discipline. So forget about the "best system" and start working on being the best executor.
One of the worst mistakes I made was to change the system every time I had a bad week. So I spent a whole year without moving forward. Now I have only one. It’s not the brightest, but I know it by heart, and with that I already have more advantage than 90% of those who improvise every day.
The market doesn't reward the smart one. Award the constant. The one who comes in and out according to his rules even if it costs him. And that's the hardest thing to accept: you don't need to be a genius to win. You just need to follow your system like a robot.
I've become so selective with my operations that sometimes I don't have to go in for weeks. Boring? Very much. Rentable? More than I imagined. You don't need to operate every day. You need to operate well when you play. And that only succeeds with experience and yes... with patience.
The advantage that works is not found, it is built. Sooner or later you will have to stop copying and start observing. Look at the market, feel the price, and repeat that for months. Until something clicks. There begins your advantage. And nobody will give it to you.
If you want to have an advantage, start by stopping trying to avoid losses. They are part of the game, and if you do not accept them, you will never stop chasing fantasies. Every well managed loss is a victory. Every loss avoided by fear is a trap. Learn to distinguish them.
Do you know what helped me the most in my way? Stop looking at daily results and start measuring in blocks of 20 operations. When you do that, emotionality goes down and statistics goes up. That’s where serious trading begins.
It's funny when someone says "this strategy doesn't work" after three bad operations. As if the market was forced to validate it in 48 hours. Probabilities need space. They don't measure in microexperiences. If you don't understand that, trading isn't for you.
There are traders who don't understand why they win. That's as dangerous as not understanding why you lose. If you don't know what you're doing right, you won't be able to repeat it. And if you can't repeat it, then you're betting.
The real grail is not a formula. It is a repeatable structure that exploits real market patterns. And that structure only appears after hundreds of hours of observation, error, adjustment and repetition. Does it give you laziness? Then keep dreaming of shortcuts.
Do you know why there are so many scammers in this world? Because they know there are thousands of desperate looking for miracles. The solution is not to find the grail. The solution is to stop behaving like a naïve and assume your process.
The most profitable thing I learned was to say "today I don't operate." That phrase has saved me more money than any strategy. And in order to say it calmly, you need to have confidence that opportunities don't end. And that's also patience.
Does your system lose at times? Well. So it’s real. He who says it never fails, or lies or is about to burn his account. Accept streaks. Embrace uncertainty. That’s where real traders grow.