Everyone knows we need a good plan to succeed, but what the heck does a good plan entail? In the course of studying how to trade, we begin building assumptions that govern our outlook of what the
market is, and how the market should operate.These assumptions are stitched together by general concepts of technical analysis and stuffed in a little box like a holiday turkey left to bake, the finished product we label a “plan”.

Logically following, if your underlying assumptions are incorrect, your plan will fail no matter how well your analysis. The irony, of course, is that the more disciplined you are in following a bad plan the more money you will lose.

Game Theory:
Majority of traders are taught what trading should entail, but in the market the majority is wrong. It is often said that the market is set up to frustrate the most traders. (more…)