Trading is a very personal and intimate thing. There is no one size that fits all. A strategy that works very well for one person, will not work for another – even if it is 100% technical.
The fact is that there are many systems in the world, and no two traders will ever perform the same strategy in the same way. What does this mean for you?
First, when you start trading a system which is not developed by yourself, you have to adapt yourself. Take things that are meaningful to you and check away from what is meaningless. You actually need to know your system to be able to trade profitably.
So what are the main characteristics of a system, and your personality / current situation in life that you should look at when deciding if a particular system is good for you or not?
You should consider how much time you can and want to invest in trading with a particular system. Everyone wants to be ”day traders” in the beginning, but they do not see that it means long hours, high demands on concentration, a lot of discipline and because hämndhandel is a much bigger problem for the ”day traders” than for ”swingtaders”.
Keep in mind your level of patience and emotional control. You can wait days or weeks for a trade and keep it? Against your common sense will low patience actually to do daytrading harder for you, because sitting in front of your computer screen is even more stressful for your patience.
Are you a fast or slow thinker? If you think slowly, is it not time for you.
Do you like to solve complex puzzles, do you like to think deeply or do you need a lot of action? Have your system generate a lot of signals per unit of time?
Are you a visual person or do you prefer to watch a number of numbers? In other words, if you want to change patterns on a chart, or do you see figures volumes, and so on?
How flexible are you, how easy is it for you to change your mind?
You run the risk of resistance or are you a risk taker? Do you need instant gratification? In that case, fit a system with lower RRR.
What part of the system is meaningful for you and why, or why not?
Is the system applicable to the markets you want to trade?
Last but not least, you have the technical equipment required to trade the specific system, t.ex. big screens, fast internet and so on?
These are just a few of the things you should consider when you intend to buy a system and there are many more to consider. Of course, before you develop your own system, these issues should be addressed.
Apart from this, not only should the system be considered, but also your levels of happiness and satisfaction. A system that is meaningful for you will not meet your requirements with pleasure when you take a winning trade, but therefore, it will frustrate you even more when you take a loss.
After all, the markets are so complex that I personally am looking for an explanation as to why a pattern works or not is particularly useful. It is enough for me that a pattern works, I don’t worry why it works. Then, there are many people who need to find an explanation as to why they were born, so I guess that these need an explanation as to why a system works as well.
It is really up to you. You must know yourself. It is important that you are aware that you can’t take a system, start trading and earning money from the first beginning. On one occasion, when you know the system in and out, you must make adjustments in order to fully rely on it. For without the confidence that a system is not worth a single penny and without adaptation to your own personality, no confidence.