Now going back to my argument of keeping things simple. How can I possibly preach the need for simplicity in the light of different analysis and indicators I use? Well… I never said the business of trading was simple… only that our approach must be straigthforward and simple. Especially since we, as traders, must internalize a vast amount of information at any given time and transform this into action. Action filled with confidence and conviction. How can this be done?
First of all: one must do their homework. One must be prepared to do the leg work required to understand their business. Simplicity does not mean that no hard work is involved. In my years of trading I have observed that those who are successful are the ones who have taken the time and effort to learn their craft and avoid short-cuts. There is no *ifs*, *ands* or *buts* about it. You MUST be prepared to roll up your sleeves and do some hard work.
(Note: Finally got stopped out of my daytrade. A 3pts gain on one unit, and 4.5pts gain on three others out of four lots in the game. The market now appears to be forming a bottom ((being 14:10 as I write this))… and it appears a test of 1315 is likely, followed by a test of 1320 if 1315 fails. Market reached a critical *exhaustion level*. Kind of like a rubber band that was stretched way too far – it now snaps back. But trend is still down, so I dont believe she can rally significantly and will most likely close in bearish territoty, below 1320. Nothing at this time warrants an entry… but a test and failure of 1320 or 1315 area would be a great short)…
There is no *ifs*, *ands* or *buts* about it. You MUST be prepared to roll up your sleeves and do some hard work.Now. Once the basics are learned then it becomes a matter of putting it together. In the study of trends, momentum, S/R, simple cycle analysis and pattern recognition one learns to interpret lines on a chart into raw information revealing the thoughts, feelings, and biases of the market participants. One takes this info and is able to apply it in a simplified manner by INTEGRATING multiple concepts.
This is, in fact, the key to it all (IMVHO).
Once the knowledge based in place and thoroughly understood, it becomes a matter of integrating the info into a single mode of expression and perception. The distinction between tops/bottoms, breakouts and trends become blurred. They all become a unified, integrated view of price action. Where a potential top or bottom on one time frame can merely be a pullback leading to a continuation of a trend on a larger time frame. Or a tradeline breakout in one time frame can be an established/confirmed trend on a smaller time frame. Integration of time frames, integration of techniques, integration of strategies into a simplified, unified approach to trading – this is what I have strived to achieve in my trading and what I have attempted to impart to others. Where integrating the many ultimately becomes the application of one theory.
For continuation, see part four of this rather long original article.