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Strategies & Market Trends : Trade What You See, Not What You Think -- Ignore unavailable to you. Want to Upgrade?

To: Apakhabar who wrote (600)	5/13/2001 5:51:22 PM
From: Threei	Read Replies (1) \| Respond to of 867

What Vadym and Chris espouse is not an absence of thinking, but rather an absence of opinions I agree with this, plus we try to avoid overanalysing of things, situations where trader attempts to figure out as much as possible. It often leads to unpleasant surprizes because market is changing all the time, even in shortest time frame. Eventually it all probably boils down to forming of opinion like you said. As far as chess concerned... I am former semi-professional chess player, third prize on junior championship in USSR, 1979. Chess is really whole different ballgame, but I do see how chess skills could help in trading. Culture of thinking, discipline of thinking, focus, concentration, handling of tension, emotional control - those are common skills for both. Former Soviet grandmaster Lev Psahis (now Israel) told me couple years ago that many of former Russian chess players become traders after immigration... probably not an accident :) Or we have inherent abilities for this? (hiding... sorry, coulnd't resist :)) Thanks guys, great discussion, value your opinions very much. Vadym

To: Apakhabar who wrote (600)	5/13/2001 10:37:06 PM
From: The Flying Crane	Read Replies (2) \| Respond to of 867

>>"I see the this as essentially a "blank slate," while you see this as a state already possessing abilities that later get masked by 'programming'."<< We are getting close. The "blank slate" is exactly what I mean. It is because of this blank slate that we have the ability to learn and adapt the "correct" way of trading well without having to struggle through our old programming. Perhaps, because of my poor choice of word (inherent), I may have giving you the impression that this blank state already possessed abilities to trade well. That is not what I meant. Thanks for bringing the point all the way to the surface. >>"BTW you said, "Thinking is dangerous in trading." A point about thinking: there's thinking in everything and every trading method. What Vadym and Chris espouse is not an absence of thinking, but rather an absence of opinions, especially opinions that rationalize a losing position."<< Let's define "thinking" Per American Heritage Dictionary: Think: 1. To have or formulate in the mind. 2. To reason about or reflect on; ponder: To me, the moment I think, I'm already formulating something in my mind which is, no doubt, influenced by my belief systems. In other words, the moment I think, I'm forming an opinion of the event I'm observing. However, you're right. There is thinking in every trading method. But these are thinking during the planning stage to come up with a workable trading method or system. Afterward, we should just play the statistic by executing the trading signal generated by the trading method or system. Hopefully, the favorable odd in our trading system will generate a positive cash flow to our account after so many trades. Therefore, by not thinking, we are simply executing our action (not unlike those of the Blackjack dealer in the Casino) according to the rules defined by the trading system. Think about it, the Blackjack dealer will either hit or not hit his/her hand according to a well-defined rules. The dealer will win and lose during the whole session. But the house odds will guarantee the house will eventually come out ahead giving enough time. In this case, the moment the dealer starts to "think" about his hand and perhaps bypass the rules, he is no longer working with the house odd on his side. Thus, my point is that by not thinking, we are simply following a set of rules defined by our trading system. And the moment we think, we are in danger of forming an opinion that may force us to bypass the rules defined by the trading system. Following a set of rules only requires a pair of eyes in our case. We see the setup, we take action. That is why I love this thread heading, "Trade What You See, Not What You Think". >>"Surely you don't deny the importance of anticipation in trading. Anticipating a capitulation, a volume spike, this is all thinking."<< Exactly my point! The moment you try to anticipate, you are already thinking. And by thinking, it is easy to fall into the trap of forming an opinion similar to the example you gave. Remember, the moment you anticipate a capitulation, you are already forming an opinion where you should be selling. Whereas, in a chart-pattern trading system, a certain bar-chart pattern will automatically trigger you to sell regardless of whether you think there is capitulation or not. >>"Can anyone become a good trader?"<< Since we have all been programmed in certain way that tend to contradict the nature of trading, my answer is no too. Simply because it is a formidable task to side-stepped our own belief systems. In the same spirit, I respect your opinions as well despite our different path of seeing thing. Thanks for make this discussion a lively exercise. Cheers! FC