Published on February 16, 2014
What indicator do you use is a very popular question but it misses the fact that it is not the indicator that will define your success.
It is neither the “secret” settings that are used or the number of indicators that are tossed up on a chart.
That question "what indicator do you use" is actually quite meaningless and will get you no closer to your trading goals knowing that information.
If you see moving averages on a chart, what is the important variable in the trading plan? How about stochastic? Will knowing a stochastic is used help you in making trading decisions? It won’t help you at all without knowing an important variable.
How about asking HOW that indicator is used? Now that is a question that can give you actionable information.
If I told you that trading with these two averages, I have a superb win rate with low risk and high profit potential trades, what is the logical question?
If you asked how do you use them …..you would be correct! Now that is actionable information that you could start using to improve your trading!
Questions that you ask can point you in the direction of your goals or further from them. In trading, it is the same thing. Far too many people get caught up in irrelevant thoughts and questions that do not move them closer to where they want to be.
If we agree that psychology plays a big part in your trading success, don’t you think that you should laser focus on the things that matter? Ask questions that can produce actionable answers?
If you saw that chart for the first time and could ask one question, you would want to ask a question that would focus on concepts. That question is obviously about how to use what is on the chart. Let’s compare 2 questions……..
What indicators are you using? I am using two moving averages.
Does that help you? Of course not.
How do you use the indicators on the chart? Great question!
Once they cross over, I am on alerts for shorts in this case. I need a bar to retrace up into the area between the two moving averages and close inside. Having prior support and resistance is a good thing.
Then, as long as there is not a moving average cross to the upside, I will look to sell stop below the previous lower bar low. Risk is defined above the swing high.
In reality though, this is is not about an indicator. This is about your focus.
There are many shiny objects that are looking to grasp your attention. In trading though, focus is everything.
Focusing on: - following your trading plan. - following proper capital management - understanding that the indicator will not make you successful.
I remember when I got into trading and was deciding how to approach the markets, my question was about how to get on board the trend. How can I get involved in the action and, knowing that most people lose, how to keep my risk low.
Once I understood the concepts that I wanted to use to approach trading, I then set out to find how to make the concepts come alive. I can honestly tell you that I never system jumped.
I worked through things and if I was not “getting it”, I moved on to something else. My questions were all related to the concepts in my trading…… that was my focus.
Questions are good, but the focus should be on actionable information… something you can run with. Ask question in relation to concepts and that can actually propel you into developing your own trading system.
Even people that use trading systems such as Trend Jumper, some have added/subtracted a few things to suit their needs. Free Version Trend Jumper Download http://www.premiertraderuniversity.com/system/
They understand what their needs are because they have focused on the important questions that will empower their trading. Free Version Trend Jumper Download http://www.premiertraderuniversity.com/system/
They have tweaked it to suit their needs and they can only understand their needs because they focused on what mattered. Free Version Trend Jumper Download http://www.premiertraderuniversity.com/system/
There are good questions about trading and then there are useless questions. Focus on those that provide actionable information
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