Trader evolution

We are ourselves and everything, what surrounds us, is a product of evolutionary processes, which were launched by nature many millions of years ago. And this process never stops.. We rarely think about it., but at this moment we are no longer the same, what were a minute ago. Something has changed in us., even though we don't notice it.

Learning something new for yourself, gaining new knowledge and experience, we are also starting the process of evolution. It can be quite interesting to watch., how traders evolve. Entering the market in almost complete ignorance, gradually they become professionals with a stable income. Let us consider in more detail the stages of the evolution of the trader.

It is at this point that the neophyte trader is located.. He has little or no understanding of the structure of the market., has no idea about the relationship between markets, and even more so between markets and the economy. Price charts for him, a meaningless hodgepodge of colored lines and squiggles, which are more like an abstract picture, than anything containing useful information. In his opinion, to make at least an assumption about the direction of the price based on this tangle, you need to use black magic.

But time passes., the first fears gradually disappear. Trader starts watching, learns to read charts, studies the market. After a while, chaos takes on the traits of meaning., the schedule is a mess away, unnecessary lines and indicators disappear.

Trader browses the markets every day. After a while (sometimes quite a long time) he notices a certain pattern. A bomb explodes in the trader's head: "O, yes it works!». It seems to him, that the secret of the market is revealed, and he focuses on that pattern..

The trader begins to find more and more examples, and they all work. His confidence in the pattern is growing., and the trader decides to use it next time, when it appears. A trader opens a trade and almost immediately receives a stop loss. As a result, he takes a step back and studies this pattern farther. When does it appear next time, then continues to work. One more thing. And again. The trader decides to try again and gets a stop loss again.

Most novice traders go through losses. But all this is an integral part of the market cycle and trade.. There is no such thing as, as on 100% profitable system.

But, when traders assess the success of a certain pattern, they automatically expect a profit from it. They don't expect a loss., to see, how many times in a row the design on the chart may or may not work. Instead, they continue to climb into the market and get burned., Not understanding, that the problem is not in the pattern, and in their inability to feel the "breath and mood of the market". So instead of, to change pattern after pattern, it is worth trying to understand the nature of the market.

A trader has learned so hard to make money in the market., and this damn pattern doesn't work only in those cases, when exactly he decides to open a deal! If the trader does not trade it, the pattern works perfectly. This makes the trader feel betrayed by the market., Books, materials and gurus, from whom he tried to learn.

And because one of the most painful experiences is the experience of failure at that very moment., when success was so close, it makes the trader feel angry and desperate. What's the point of trying to analyze something and improve your trade?, when there are so many dark forces, who will still take your money?

It's a tipping point.. Traders at this stage make up the majority of participants in various forums and social networks.. They blame everyone for their failures and call the exchange a scam.. They, who will not be able to pull themselves out of this state, will leave trading forever.

If the trader safely passed the previous stage and did not leave trading, then it will go into the phase of the "holy grail". Before that, he had failed with various patterns., but believes, that there is some kind of "secret weapon of successful traders", which is owned by the chosen. It's a kind of sacred knowledge., mastering which will help him filter out all the bad trades. Once the trader finds this magic key, his profits will soar and all his innermost dreams will come true..

The trader begins to learn each new method and indicator for him. Buys every book, attends each course, subscribes to every newsletter and to every market consultant, registered on every trading site and in every chat. He buys more sophisticated software.. Buys ready-made systems. He is ready to spend any money., to buy success.

A trader accumulates so much of everything, that he begins to be constrained by analysis paralysis - he cannot make a single decision. All systems and indicators simultaneously give contradictory signals and show in different directions. As a result, the trader focuses on those, which are consistent with the direction of the transaction, discovered by him.

The fact, that without an internal acceptance of the very fact of the inevitability of loss and risk, trade-related, the trader will rush around looking for something or someone, who will tell him, that he is right in this case. On the one side, it helps shift the responsibility for failures to someone else.. But on the other hand, all this set of multidirectional indicators turns the brain into jelly by the end of the trading day..

Many traders stay at this stage forever. They spend their time looking for an answer., which does not exist. And even if they manage to earn something., they never become truly successful professionals, and it has implications..

Trader, who is able to escape from the fourth stage, can use his experience productively. He begins to understand, what suits him, and what not, what trading styles and techniques best suit his character and temperament. But instead, to fully focus on it, he starts asking himself questions.:

• What exactly he wants? What is trying to achieve?
• What kind of trading makes the most sense to him? Long-term or medium-term? Short term? Day Trading? Trend Trading? scalping? What is most comfortable?
• What instrument — futures, stock, ETF, bonds, options – provides range and volatility, which suit him in style, but don't go beyond his risk tolerance? Did he learn anything about indicators?, which could be used?

And now the trader begins to listen to his inner voice in order to, to determine, what suits him, taking everything, what he had learned earlier, and experimenting with it.

He incorporates the scientific method into his market analysis., to develop a trading plan, taking into account the management of risks and open transactions. He learns to appreciate curiosity., detached interest, show perseverance and patience. Take individual fragments and make an overall picture of them. Tries to form exclusively his own trading strategy, in which he is completely confident, because I have carefully checked on my own experience.

Now the trader takes full responsibility for his trades., including damages, that is, he understands, that they are inevitable. Instead of getting angry at losing trades, it takes them as such, what they are, as an integral part of the natural course of business. He analyzes them in order to, to determine, whether a mistake was made and whether it can be corrected, although real trading mistakes are already rare for him. If not, he just brushes off the loss and moves on., after all, he understands, that controls your risk.

The trader does not rant about his broker, market maker or "this conspiracy of all, who is trying to deceive him and deprive him of money". He is not trying to take revenge on the market., not worried, does not lend itself to hope, fear or greed. Impulsive trades are a thing of the past. Instead, it just trades..

At this level, the trader achieves an almost Zen-like trading state.. Planning, analysis, research - these are the points of application of his main efforts. When does the trading day open?, it is ready to trade: Calm, relaxed and focused.

Trading becomes easier. The master is thoroughly familiar with his plan and knows exactly, what will do in any market situation, even if it means an immediate exit from the transaction in the event of an unexpected development of events. He understands the inevitability of losses and accepts them as a natural part of the business.. No one can hurt a trader, because it is protected by its rules and discipline.

A professional trader feels the market and is tuned to market tides. He doesn't need to know, what the market will do next, because he knows, how it will react to everything, what the market is doing, and confident in its ability to respond correctly. He knows for sure, what he wants, and patiently waiting for the right opportunity. If this opportunity arises, he acts decisively and without hesitation, and then again patiently waits for the next opportune moment..

The trader no longer needs confirmation of his own rightness. He observes the movement of the price and draws his conclusions.. When market behavior changes, his tactics are also changing.. He admits, that market movement is the ultimate truth, therefore does not attempt to outwit or deceive him. It is at this stage that an intuitive understanding of the market appears..

At the end of the day, such a trader reviews transactions and analyzes his work., and then, if necessary, makes adjustments and starts preparing for the next day, feeling satisfied with a good trade.

This is the stage of knowledge, based on research and experience. It is at this stage that the trader receives the desired result - a stable profit..