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The key word in the title of this article is “Finding”. One of the questions we are frequently asked as Trading Tutors is “What is the best market for me to trade?” This seems like a very reasonable question and people become frustrated when the answer is “It depends”.
Imagine if you will, that the time had come to replace your car and that you had the opportunity to ask Michael Schumacher for his opinion as to the best car you could get. What might his possible answers be?
- A Ferrari
- Something with maximum power to weight ratio
- Anything red with superb traction in corners
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Or he might say “It depends. What do you want it for, how much do you want to spend, what trade-off can you accept between performance and running costs, do you want spare parts and servicing available promptly, anywhere?
Back to trading again, there are specific characteristics of different markets be they stocks, currencies, index futures or commodity futures that can work better or worse with different trading plans but unfortunately there is not a brochure that neatly tabulates the features for comparison.
Finally, there is the unfortunate fact that the markets are greatly affected by human emotion and mass psychology so they can be capricious and change their character for no obvious reason. For example on the 11th July Oil touched 147 USD and yet on the 5th August reached as low as 120 USD, an 18% decline in 16 trading days. Does it seem likely that the world’s energy demand fundamentals have changed this quickly? No of course not, but as traders we don’t particularly care so long as we know how to capture some of that short but highly profitable move.
Closely related to our first question, is “How do I get more consistent results from my ABC Trading Plan as taught in the Smarter Starter Pack?” Often, this is a question arising from having expectations which exceed our current level of study and experience. Would we give our children the keys to a car, point out the steering wheel, the “go” pedal, the “stop” pedal, and tell them to read the RTA book of road signs and expect them to drive safely in the city and the country, in day and night, in sun fog or snow and to watch out for drivers who break the rules?
It is common sense that we would not do this, but every week people excitedly rush into their first trade having not completed the reading, watching or practicing aspects of their education, having not spent enough time understanding the powerful software tools they own, and having not tested their plan on their chosen market.
Yet the excitement and desire to be successful dulls our perception of danger. We have all been there but as independent, self-directed traders and investors we owe it to ourselves to note W.D. Gann’s words in “Speculation, A Profitable Profession” – “Remember that the harder you work, the more knowledge you will get, and the more profits you will make.”
Rather than being a “One Size Fits All” proposition, the “ABC Trading Plan” is in fact a framework of trading plan options that can be shaped to specific goals. It is essential that we each make it our own so in future articles I will further explore some of those choices.
Learn To Win!
Alard Russell
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