"The market behaves much like an opponent who is trying to teach you to trade poorly."(

If simply one ask you the question that how long would a gambling casino be able to stay in business if most of the customers won instead of losing? It is quite an engrossing question. The markets are no different. For maintaining existence, the markets must function with such technique that causes most members to lose. There would not be enough money available to pay the winners if the majority were repeatedly taking profits out of the markets.

Gambling casinos have a plus point over the markets because they are liable to set the rules of the game to assure that the house has a precise boundary. The markets cannot directly control how the individual participants will play. Most traders are intelligent, competitive individuals. There are seemingly unlimited sources of information about how to trade. There are powerful computers within everyone's reach to help conquer the markets. Why is it then that such a high percentage of traders still end up losing?

A familiar reply is that traders cannot rise above their emotions well enough to succeed. That is certainly true. Another not as much of well-understood reason is that the markets constantly send out false information .But this does not means that the markets have any desire or that there is a planning among insiders "evil" floor traders to fool the rest of us. This is something that just happens because of the nature of markets.

Every time traders are not rewarded with a beneficial trade they do something right, nor are they castigated with a loss every time they do something wrong. This makes it exceptionally difficult to figure out what is right and what is wrong. Compare this to an electric fence. Every time you walk by and do not touch it, you feel fine. Every time you touch it, you receive a painful shock. It does not take a man or animal long to learn how to relate to an electric fence.

Think how much easier learning to trade would be if you automatically took a loss every time you failed to follow correct decision-making procedures. At the same time, what if you were always rewarded with a profit when you traded correctly? You would be able to learn the correct trading rules much more easily. One important piece of misleading information send by the opponents is that the market is continuously altering its behavior so the successful trader must be cautious to change his approach to keep pace.

Have you ever observed what a stable catchphrase this is from various trading experts? It is a ordinary piece of usual astuteness that no mechanical approach can be successful very long because the markets change. You are advised, therefore, to change your system to keep in tune with recent market behavior.

It is in the expert's selfishness to sermonize this gospel. Anyone who tells you that the markets are always changing no doubt has found a "solution" to how to keep his trading method up-to-date. He probably wants to sell it to you in one form or another. If he is not selling his system, he at least can appear incredibly wise and resourceful to his audience. It is a sure thing his audience has not found such an elegant solution to beating the markets or they would be rich and would not have to listen to any experts.

One more reason experts perpetually allege the markets are forever changing is that it is a suitable excuse for poor performance. Every successful trader has various periods when his system or method does not seem to work. It is more pleasant to say the markets have changed than my system is not working right now. If your system is not working, it implies you have failed. On the other hand, if the markets have changed, that is beyond your control. You can just "fix" your system. We are not saying the markets do not change. They clearly do. There is famous saying about the markets is, "The future will be just like the past, only different." However, make an effort to change your approach to "keep up" with this change is like a dog chasing his tail.

The purpose of this market wrong information is to cause people to be apprehensiveness of successful trading methods and discard them too soon. One of the most reliable traits of professional traders is the ability to stick with their system much longer than the typical loser. We all go through losing periods, no matter what type of approach we choose. We cannot increase our chances of success by constantly changing our approach. Since there are many more losing approaches than winning ones, we actually decrease our chances of success by frequently changing our system.

The correct solution is to find a non-optimized approach that works over a long period of history in a wide variety of markets. To avoid over-curve-fitting, use the same rules for all markets. If you can trade it for an extended period in the future in a wide variety of markets, you are likely to be successful, although success in never guaranteed.

Human nature is such that we are always trying to improve. I am not suggesting that you might not be able to create a better system in the future. Just do not fool yourself into thinking that it is better because it is somehow adapting to ever-changing markets. It is better because it is more profitable over a long period or because it trades more markets profitably.