Hmm.. I would have to say there was definitely some market wisdom in those comments by
Ant.
Let me very strongly suggest to you however that
much of the long period of struggle is perhaps unnecessary because it is
foolishly spent looking for the Holy Grail of indicators, systems or strategies. Yes, you have been told this numerous times before, but
did you really pay attention?
New traders seldom take the time to learn the lay of the land (the real underlying structure of the market they wish to trade) or find a trusted guide to this treacherous territory, until such time as they have totally exhausted themselves and their trading capital in their useless search for what others told them (on day one) did not exist. Would they listen? Absolutely not! Thus the actions of most traders, in their early years, cause them to appear to be "dumber than a tree stump" until they have finally reached that exhaustion point. It seems only then that they will begin to listen to the wisdom of those who have gone before them rather than thinking they will somehow come up with that one right combination of magic indicators that works almost every time.
Here's a (really important) little hint: It is more about observation of market movements and also harnessing your own emotions than it is about strategies, indicators, methods and systems. Don't be blinded by the B.S. comments bandied about by the 95% who can't trade to save their lives but who still love to read their own opinions in print! I wholeheartedly assure you that there are traders successfully trading many of the methods and/or strategies that you have already tried and discarded as useless. It is far more about
you than it is about the individual method.
Some compare the markets to a dangerous jungle, others to a battering trip down the rapids. Either way, if you don't understand the lay of the land and act accordingly you will either get eaten or bashed upon the rocks in very short order.
If you were suddenly uprooted from your quaint, comfortable and cozy little home environment one day and suddenly forced to make your living in the jungle wilds (with no realistic possibilities of escape) would you take the time to survey things and get a lay of the land or perhaps even search out an experienced and trustworthy guide to help assure your survival?
Would you perhaps begin to look for the tell-tale signs of all the treacherous snakepits, quicksand, crocodile haunts, lion and tiger dens, etc. or would you boldly stride through the jungle with only your fancy new hip-boots, trusty multi-function pocketknife and some newfangled high-tech compass and just hope for the best?
I daresay that although the right answer to the question above seems obvious, 95% of newbie traders choose the second alternative almost every time. They have already firmly and unflinchingly bought into the hyped idea that trading the markets is going to be their financial savior. That it is going to be easy and the one sure way to an eventual fortune if they just open an account, select a robust charting system that offers enough of those amazing indicators and pay attention. They feel they are already "smart" and thus quite capable of pairing the right indicators and strategies together to make this thing totally "easy peasy" so they can soon be "rolling in the dough" (celebrating their huge winnings.)
If you are going to ride the rapids of a river for the first time, I daresay you had best either hire yourself a damn good guide or else you had better find out where it is deepest, which way the currents flow at different points, where the bends and treacherous twists and turns might be, how fast it moves across these key points of danger (and whether there might just be an undertow at some of those points that could suck you under never to be seen again) whether the time of day makes any difference in the flow of those rapids, and even what type of boat and paddles migh best serve you on your trip as you finally set out to navigate that river.
If you cannot find an acceptable guide, then yes, you will have to do all that surveying and planning work on your own, through observation and more than a little testing
BEFORE you just jump in and wing it. The same holds true for navigating a trip through the markets. [By the way, for those of you who did not quite understand all that.. the jungle and the river rapids=the markets, and the professionals (who eat, sleep and breathe these markets) are the snakes, crocs, lions, tigers, etc.] Once you jump into the markets you are already in the jungle or the rapids and your job is to get through each day reasonably unscathed while slowly but steadily improving your long term survival skills based on what you learn from each outing (trade.)
Perhaps truly "smart" new traders would best be served by taking an initial period of 6 months or so to simply observe the price action in the markets day to day. They should perhaps also give up most, if not all of those fancy and mostly useless lagging indicators. I mean who in their right mind would dare risk driving their car down the high-speed freeways while focusing almost entirely on the view in their rearview mirror for guidance and direction?
Also, just as a side issue since we are speaking of "smart" here, why do you think that the reportedly best "analysts" in the market invariably make some of the absolutely worst traders? Is it possibly that they get too caught up in the trees to see the forest and keep running directly into huge trees right in front of them? Is it perhaps also because they are used to playing a safe and emotion free game as analysts and thus are not prepared for the real battle of the trading those same markets with real money, a battle which is mostly fought between themselves and their own emotions?
Nobody but nobody knows exactly what is going to happen next in the markets, so don't invest your extremely valuable time and hard earned money into trying to come up with indicators and fancy, complex methods to predict it. A firm called Long Term Capital Management tried that already and failed quite miserably. Mind you, they had more computing power than almost God himself, a large group of some of the very brightest minds in the business,etc and yet they still lost so much capital that their failure almost sent the whole U.S. economy into a tailspin.
If you wish to be truly "smart" about trading then I'd say you should have precious few indicators and instead should focus on becoming a Master of the Obvious. That means focus intently upon what is happening right now, right in front of you on your screen in the form of price movement and the reactions that repeat themselves over and over again as movement comes to value points, S/R or Fib points that lie in its path. Otherwise, you will become little more than an impulsive gambler and likely a very poor one at that. That is the best advice I think I can come up with for potentially acting "smart" in today's markets.
Thanks for reading and I hope I didn't totally bore you with all that.
Happy Trading
P.S. For those who felt the above was a little off topic, please do not confuse "simple" with "easy". Trading is simple, meaning price can only go up, down or sideways. However, even though it is simple at first glance, it is anything but easy. The trick is to learn how to jump in as price moves up or down (not sideways) and then jump back out with a profit before it changes its mind. If you think that is easy then you clearly have never traded real money for more than a few days. Will you be one of the not so smart traders who needs loads of indicator based, after the fact confirmations before you jump in or will you be one of the very few smart traders who has learned market structure and price flow and uses market profile, volume profile, support and resistance pivots or other real time buy and sell pressure information to time your trades? The choice is up to you and it can be as simple or as complex as you wish to make it. The real pros swear that simple strategies are best and I happen to think they are right.
Good luck to you