Summer markets can be a bit of a grind at times. Some days the market is hot with plenty of compelling trading opportunities while others are cold with little movement or momentum and not much on offer. While patience and discipline are critical elements of trading even in highly active markets, I've found it sometimes takes an extra dose of those qualities to trade well in the summer months. As much as I enjoy trading and still find the craft to be fascinating after all these years I find the summer grind can sometimes feel like... dare I say it... hard work!
Today a trader in our live class brought up the question of whether experience and accumulated trading knowledge (such as technical price patterns, structure, etc.) were the key to consistency during slower markets or if trader psychology was what really made the difference. It was an interesting idea because there's no doubt that a trader's mental framework is the biggest piece of the puzzle to long-term consistent profitability but experience very much plays a role there.
Essentially, you don't know what you don't know, and sometimes a trader needs to go through certain experiences in the markets before everything locks into place in a positive way. For most people experience and having the right mental tools for successful trading are inextricably linked. There are exceptions where someone steps into the trading arena for the first time and seems to have the framework necessary for immediate success (from having developed a robust mental edge from elite athletic competition, for example) but they are few and far between.
Finding the Right Path
I was not one of them. I took time and experience to gain confidence in my ability to execute a trading plan without hesitation. Similarly, that experience has also helped me to know when to stand aside and wait things out until the next good setup arrives.
No amount of technical knowledge, additional indicators, or reading trading books will create this kind of disciplined trading approach. If anything, the constant pursuit of new trading tools means that most novice traders are simply trading more than they should be while constantly switching systems or going to the other extreme and barely trading at all thanks to "paralysis by analysis". They would likely be much better served (and more profitable) by just taking some of the things they already know, simplifying them into a workable plan, and then trading it in a focused way for a good period of time.
For me, a big part of developing the right mental framework for trading has come from "letting go" of the pursuit of perfection. Trading isn't about certainties and it doesn't matter how many books you read, how many patterns you know, or how deep your dive into the technical world... you still can't ever know what the market will do next.
I don't really care if I can fully explain they hows and whys of every price move because I know it's impossible. I don't care about taking a loss as I know they're inevitable. I'm not focused on finding a Holy Grail system that wins 95%+ of the time so I don't need to confront the pain of taking a few hits. I just care about being able to see results over time. As a wise trader once said, "don't let perfection get in the way of profitability".
Sticking with A Plan That Works
What does matter is being able to have a workable trading framework you can use day after day that provides trading setups with a positive trading expectancy. If you have that and you're confident in it and in your ability to execute then it's simply a matter of taking the trades. If that means you have a dozen trades in an hour during a wildly volatile market then you should take those trades. If it means you only have a few while spending most of you time waiting things out during slow market conditions then so be it! In the end your edge will play out all the same but only if you stick to it!