Trading Coach Advice - Simplify Your Trading

There is much to master when you first start trading

, it is easy to become overwhelmed. After all, there's technical analysis, fundamental analysis, money management, risk management and trading psychology.

Once you've a grasp on those subjects, you need to work out which markets you will trade. There are many choices to make and it is easy to get stuck in analysis mode and never get into action mode.

For some, technical analysis is comforting as it seems very scientific. There are so many indicators to learn about that come with settings that can be tweaked, it is easy to believe that if you just spend time, you will find an indicator that will produce endless profitable trades. Often what happens though, is that the novice trader will try and combine many indicators into a trading system. They will wait until all of the indicators line up for the perfect entry signal. Unfortunately, they may be waiting for a long time.

One point which has stuck with me made by my trading coach, is that there's a great difference between an analyst and a trader. It was not obvious to me at the time, but know I understand the meaning. The analyst enjoys the challenge of looking at the markets and using or building indicators that could be the missing link to profitable trading. They are quite happy to spend an enormous amount of time creating theoretical trading systems and analyzing the markets. The problem is, the analyst doesn't actually get around to trading. They are focused on the past and look at the trades the system they developed would have found.

The trader, as opposed to the analyst actually gets past the point of analyzing and looking at the markets and begins to trade. The trader understands that it is important to make sure that the system used is tested carefully and then starts trading. The trader has a trading plan and overcomes a fear of losing money and starts trading. The trader knows that they should take every entry and exit signal, stick to the plan and that they can not be 100% correct.

by: John Peters.

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