Chapter 30, Part II. What Type of Trader Are You? Page 8

Analytical trading

If all done well…

- You study with best mentors and your risk/reward ratio has reached outstanding numbers;

- You live as you want where you want and how you want. Trade when you need or want;

- Your skills become really good and your capital is growing day by day, so you start even to think about purchasing of some real estate or luxuries;

In reality something is always wrong…

- You have started with one trading approach, then with the other and so on, pass through many different mentors, but still can’t reach the consequent profit with trading;

- Money that you’ve spend on study within these years is hardly offset by the profit that you’ve made;

- Since you’ve decided to trade full time, your savings are melting day by day and you start to feel stress. If you will not turn to some profitability, you will have to find a job;

- Stress and sticking to the monitor force you to get mistrusted - will you ever understand what “live as you want where you want and how you want” means.



So, as you can see there are a lot of problems as with first way as with another one. Still I can make your choice a bit easier. The point is that to create an algorithm for any mechanical trading system you need to know different types of analysis, understand how indicators and other technical stuff work. In other words, you have to start with some analytical approach first. In fact, mechanical approach have two major advantages – no stress (it makes trade independently from you), trading 24/5 time – when you eat, sleep and occupied with other business. Mechanical systems could be solution for those, who have extreme lack of discipline and patience.


P.S. This lesson was written by Sive Morten, who has been working for a large European Bank since April of 2000, and is currently a supervisor of the bank's risk assessment department. Sive's knowledge of forex market and banking industry is vast and quite complete. If you have any specific questions about forex, banking industry, or any other financial instruments, please post them on the next page and Sive should answer soon.



Note: FPA ranks are earned in the battles against scam, not in the classroom.