I would describe this as a logical fallacy. Imagine another scenario with similar observational parameters:
150 basketball players flip a coin. Heads they are in the upper half of scoring on in the NBA, tails they are in the lower half.
2nd year - 75 left
3rd year - 37 left
4th year - 18 left
5th year - 9 left
6th year - 4 left
Now Kobe Bryant, LeBron James, Carmelo Anthony, and Pau Gasol strut out and declare themselves some of the best players in the NBA. Is this skill or just luck?
The logical error is combining an observation (few NBA players are at the top of the game) with an arbitrary cause (their success is just luck) and creating a conclusion: Being good at basketball is simply luck. Just because luck is a possible explanation, does not make it the truth.
I think anybody who approaches trading seriously and has studied it for several years would describe it as a skill-based activity More of an art than a science.
Seek freedom and become captive of your desires. Seek discipline and find your liberty. - Frank Herbert
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Trading is the art of a observation of an action; A trader anticipates the a reaction of the observed action and makes a decision to place a trade or not.
This could never be a science because each action observed depends on your own point of view. This is what makes trading difficult. Show 100 traders the same chart and 90% of them will disagree on what they see and what the outcome will be.
nosce te ipsum
Trade what the market is doing; NOT what you think its going to do.
To me trading is the art of identifying those moments where the market has an edge, that is the odds of it moving in one direction rather than the others (don't forget to include sideways) is better than even and evaluating the potential reward to the risk necessary to take the trade. The classic example is what appears to be the end of a pullback in a trend.
@Gary D @Surly @Siler Dragon I agree with everyone, I m sorta new to this animal. But direction has the most rewards. How to execute direction is where the skill comes in. But up is up and down is down, sideways is the by product> This being said who is more profitable trend trading? day trader trading off of day charts or traders using 1min,2range,1500tick,4000volume or whatever they use? Noise,bots,hftm makes it harder in the short scope. Long scope would your wins far exceed ur losers? using the same trading technique for either trade with direction .
Has anyone just entered off a day candle and walked away with your stops in place then come back and look at it,human motion was eliminated. You can make more on paper being in and out but your success rate drops. Ie. hindsight ES fell 15 points down on a downtrending day, we'll say 5 steps down. so if you tried to enter on each step ur 1 pt late on entry and you loss a point on rev exit total net was 5 pts if you were day trading long you got all 15pts...
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I won't change direction at all if price is above
a certain price. Basically, if it's outside what I consider
developing price and into a buyer controlled zone (or seller controlled for shorts).
If price is inside development (usually on a 2hr chart), I may change direction 1-3 times/ day.
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