Quote:
Originally Posted by joelcf
Personally, I think many people use 'psychology' as an excuse because their methodology is failing to make money. It's much easier to talk about (and write books about) 'the mental game' than it is to find a way to trade profitably, because it is all subjective and unquantifiable.
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Tell me - You and I can both trade an identical method - one of us wins and one of us loses. (more like 95% lose and 5% win, I'm just using me and you as an example to make a point.)
What was the difference between us? Same charts, same system, same capitalization.
The answer is obvious, it is your head - also known as psychology. You and I have seen people take the same dang bar - and lose money, while others are up multiple R. Psychology. Some like to say that you need mental toughness - big a big swinging dick of Forex. Whatever - let's call it what it is - Psychology. I seen you call it 'stupid' - well, is that not something the emanates from the mind? Like er..... psychology?
Even you have made posts to the effect of - "You see the setup and you simply take it. What is the big deal?" That is psychology. And why do people take highly marginal crap at times? Wishful thinking - or - psychology, of you will.
There is a lot of marginal material about the subject, which is too bad, because it is far more important than anyone ever believes.
Or try this on - Why is it that nearly every trader on this thread has decided that grabbing the first fractional part of an overall move is 'great'? Is it because they cannot endure the eventual pull back or even draw down after being up 1 or 2 R to even dream of much higher returns? That, my friend is psychology - AKA 'fear'. Think about it - if we get PA off of a PPZ, then what not sit back a bit and enjoy the ride to the other side? Fear.
Why does James himself repeated say that it is very unlikely anyone will make it until they capitalize a large account? Because of that very fear. The very act of growing an account 1R or fractions thereof is extraordinarily difficult. So he advises to demo trade until you have the money. Not a bad way to go - if you have a decade or a few to burn - or want to.
But what would happen, if you cleared the cobwebs a bit - and simply allowed the market to move - and you moved with it? With the PA knowledge taught here, we have a pretty good idea where price is headed - and it usually does not disappoint - does it? Being willing to endure a little drawdown can yield huge rewards. Learning to exploit a trend - long or short in duration with adding in or reentry into it can rapidly build an account.
But it takes a very different mindset to do this. Or dare I say, psychology.
But what the heck do I know.