This week we are going to take a departure from the indicator train of thought that we have had the last couple of weeks. We are doing so because I have had some thoughts about the philosophical side of trading recently and I think there is some value to this discussion.

What do we really want as traders? Are we searching for the ultimate trading system or in the case of the last couple of weeks are we searching for that ultimate indicator that will bring us the massive success we all crave. Or, are we searching for that thing inside everyone that busts open the dam of success that we all crave no matter what endeavor we choose to go after?

I hate to be the bearer of bad news but I believe most new traders are taking the option A route above and that is a sure-fire way to fall short of any long term trading goals that we may have for ourselves. Allow me to explain my train of thought here so that this doesn’t just sound like incessant ranting about how we approach our trading paths,

I will start with a story that I hope will covey the principle thought that I have in my head at this moment. I had a few friends of mine that whilst we growing up were interested in starting a band. As all ideas tend to start out it was more of a wish about being this massive rock band that tours the stadiums and lives the life of a rock star. This thought was followed by a whole-hearted attempt to put together a unique sound that would maybe get noticed by a record executive or someone in the “biz” that could launch the careers that they so desperately wanted. Now, I will say this wasn’t just a few guys in a garage band messing around, these guys had spent some time learning to play the instruments and learning to sing and learning to write music as well. A couple of these individuals had a real talent for their craft. Now, I can say that out of all of these individuals and there were 6 of them only 2 of them made any headway into playing for real, in a band and getting paying gigs. They all had the desire but only two of them made it, the question begs, why? Well, I have a theory about that and here it goes. Those guys spoke about getting the right sound or the right song or the right band name or the right break to get them moving towards their ultimate goals. Unfortunately, that never happened for them and as life moves forward they were thrust into other endeavors that took away from the original dream of being in a rock band. This is not a unique story, as a matter of fact, I would say this is the norm instead of the exception.

So, as I stated above why didn’t these individuals have the success they so desperately craved and were willing to work for? They were not lazy. They were not unskilled. They put in the time to become good at what they had chosen to pursue, so why didn’t it work out? Well, I believe the thing they pursued was flawed more than their own limiting factors. You see they pursued a new sound, or a new look or a new whatever to try and differentiate themselves from the rest of the pack. Now, this in of itself is not fatal but it can be if this is the only pursuit. You see the two individuals that made it to the paying gig status did something the others did not and that was they worked on themselves. The went inside themselves to find out what the best musician they could be for themselves and it was this growth that eventually broke the barrier that the others seemingly couldn’t overcome. By now you are wondering what the heck this has to do with trading, and I am glad you asked, well technically I asked but so be it.

You see this same thing happens to budding traders and investors all the time. If you think about your own experience just starting out you probably remember thinking I have to learn about the charts and about the systems and about the function of the markets etc. This is a part of trading no doubt, but here is the part that causes the most pain to traders, this is only about 10% of actual trading, yet most traders believe it is 90% of trading. You see anyone can learn how to read a chart and use a platform. Anyone can learn about an indicator or learn a new strategy and many can put the strategy into action but it is only when one learns enough about oneself that trading success will actually show up. I will give you an example, I have been using a trading strategy for almost ten plus years now and it has been very successful for me. I have taught this exact strategy to others, a lot of others and I have held nothing back in the execution of the strategy and yet some do as well as I have and better and others have done very poorly, why?

The reason why different traders have different results with the same systems or strategies is that we are all unique and we need to have our trading system fit who we are before it can ever be successful for us and that is where the real work in trading begins. You must find out who you are before you can find a system that will work for you.

So, if you want to be a successful trader you will need to spend twice as much time figuring out who you are and half as much time looking for the next great strategy. Trading success is infinitely achievable for anyone who really wants it but it will require a hard look at who you really are and once this is done then you can take the next steps toward trading success.

Trade well,

Coach Holmes