Persistence Pays Off

The common perception of the proverbial self-made trader is one of some cerebral math genius who somehow figured out a magic formula, enabling him/her to beat the market day after day, and ergo profiting in the millions. Well, the sad truth is that I have seen many highly intelligent individuals try their luck at trading and fall flat on their faces as soon as their ego and hubris got the better of them. No matter how smart you think you are – be assured that Mrs. Market will always be smarter than you (and she’s brutally ruthless). I’m not saying that intelligence isn’t a bonus when it comes to trading and system development. But the two major traits that IMNSHO lead to success are persistence and discipline.

As strange as it may sound – it’s not the setups you took that lead to your financial demise. We all pick losing trades, that’s part of the game and assuming proper money/campaign management a consistent hit rate above 60% puts you into a very solid edge. No, what gets most traders are the trades they did not take. Once you start cherry picking technically valid setups you’re already steering a sinking ship. You either don’t have a system and a demonstrable edge, or you’re too emotional to follow it in the first place. Either way, walk away from trading and try your luck in Vegas instead – at least there you get pretty girls serving you drinks.

Trading successfully and consistently on the other hand really isn’t that complicated – figure out what works and then do the same thing over and over again. This may sound a bit trite but we all stand on the shoulders of giants and there are many systems out there that will give you a positive edge. If you are able to stick to the game plan and put your ego and emotions aside it can be one of the most rewarding (and profitable) endeavors of your life. On the other hand, if you cannot then it may become a very sobering experience which, if nothing else, will teach you a lot about yourself.

If you paid attention on Friday afternoon then you should be long the spoos (or SPX) right now as it triggered its RTV Buy threshold of 1635 (Sept contract). As I’m typing this it’s however pinned below a NLBL just 1.75 handles higher and there’s another one at 1642.75. I think this setup flies or dies here – above 1643 the bulls are back in charge – until then we could still see some surprise plunge lower. Be on your guard but stick with the setup. It’s permissible to be short below that NLBL as an alternative to riding it lower into the stop. As long as you have a plan before taking out a trade instead of following your emotions.

Similar picture on the NQ – the RTV Buy has long triggered and once again we have two NLBLs standing in the way.

Update on the EUR/CHF – the RTV Buy was triggered and I also wanted to show you guys the context on the weekly which seems rather supportive here. Nothing to do here until our stop is hit.

RTV Buy also triggered on the GBP/CHF – I really like the context here and I hope some of you guys grabbed this one. Again nothing to do here until we’re stopped out or head into target (mine is near the upper 100-day BB).

Once again we have a TON of setups this afternoon – so let’s dive right in:

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Did I promise too much? More setups than you could shake a stick at! Get to work steel rats but keep it frosty.

Cheers,