Hey hey: what's up my friend, so yeah, i've got a few questions right there coming in right there and say: hey rayna! What's wrong with your face man, i see little some pimple over here in your lip that some bumps all right. So so the truth is, i have actually a cold sore recovering from it, so it was quite painful episode over the last few days, but right now it's much better, at least to a point that i'm comfortable right doing this video, even though you might see some You know uh little pimply looking stuff on my face, so yeah that's from a cold sore, so moving on right. Today's episode right, i want to talk about you - know trading strategies right. Why trading strategies will only get you so far and you know what should you do instead? So here's the thing right, many traders they get started in trading right and what's the first thing that they are looking for, i can almost assure you it's trading strategy right here right now, which is the best trading strategy.

For me, man hey right now, which trading strategies should i use hey right now, which trading strategy has a high winning rate, hey ray? Which trading strategy can i, you know, use to make a very favorable risk reward on my trades. So it's all about strategy, strategy, strategy and strategy, but i'm here to tell you right that trading strategy itself will only get you so far it it's! It's near impossible right that you can be a consistently profitable trader just based on your trading strategy itself right, and let me explain why, and the reason for it is, is simple right is that when traders they learn new trading strategy right, what's going to happen, is That a trading strategy will only profit in certain market condition. I'm sure you can agree right. Let's say a a trend trading strategy.

It will only make money in trending markets when market goes into range. That strategy will stop working. So it's only in certain specific market conditions. Will a trading strategy make money and here's the thing right? I'm sure you can agree that market conditions change it can be from an uptrend goes into a range then to a downtrend from low volatility environment to high volatility.

Et cetera, market conditions change all the time, that's the only constant in trading and you can be sure of it. So this means right that your trading strategy will only work in certain market condition and in certain other market conditions it will cease to work and that's where you go to a drawdown and you go and suffer losses. So so here's the thing right. If you only look at your trading strategy in terms of the rules, the entries and exits right, it will only get you so far because when the drawdown comes, i can bet right that you won't have the confidence to continue trading that strategy, because you will be Faced right with thoughts like man, i'm losing money, you know over the last five six trades should i continue trading this strategy.

Oh man! What if this losses get even more right, you know what should i do. Should i abandon this strategy and look for something new. So you can see that trading strategy itself right the rules, the entries, exits and stuff like that, will only get you so far. If you want to move your trading career to the next stage, you can't just be looking at the trading strategy at a superficial level.

You need to dig deeper right and understand right. Your trading strategy like how you understand your wife, your spouse, getting intimate with it. So how do you get intimate intimate with your trading strategy? So i want you to answer this. Four questions, number one.

What is your trading strategy about? Is this a breakout trading strategy? Is this a mean, reverting trading strategy? Is this a counter trend trading strategy? Is this a spread trading strategy? Whatever the case is, ask yourself: what is this trading strategy about question number two: why does this trading strategy work right all trading strategy? There should be a concept, a logic, a theory behind why the trading strategy makes money question number three: when does the trading strategy work? If it's a range market trading strategy, then clearly it will make money in range market, trending, market shouldn't be making money and finally, number four: when doesn't your trading strategy work so clearly, you also want to find out which market conditions you know are not favorable to Your strategy, so let me give you an example: let's say in this case a good example. Well, let's start with a bad example: you go into a trading forum right and you find out there's new this new trading strategy when the rsi uh is below 30 20 period, moving average crosses above the 50 period. Moving average, you go long, okay and you exit right when the 55 period moving average, you know crosses below the 30 period moving average. Something like that right.

That's the strategy, that's being shared, and let's see right. Let's put this to the test right to those four questions that i've just shared with you number one: what is this trading strategy about? If you ask me, you might be, let's say: uh uh, best indicator combination trading settings all right. Let's keep it there all right. Okay, fair enough right, let's say this trading strategy.

You know utilizes uh, best combination, parameters of indicators to trade, the markets question number two: why does it work uh, uh you're stuck right? Why does it work? I myself have no idea what i just said and i have no idea why it works right, so you can see that many traders they will get stuck at a point at. Why does it work many times i mean traders will say. Oh because xyz trader posted on the forum, he has a high reputation. He seems legit right.

It should work, no doesn't work that way. You have to do the work yourself. So that's an example right of when you're caught right with a trading strategy which is just superficial, and you know that in the long run you won't have the confidence to trade it when the drawdown comes. So now.

Let's look at another example right by this camera. You know understanding deeper about your trading strategy number one. Let's talk about a trading strategy. What is it about? Let's say trend following right: a trend following strategy makes money in trending markets.

So why does it work well trend following works right because market trends over time? Right not all the time, but it trends right in the long run and it trends because there's always fear and grit in the market. You know traders get greedy. Investors are greedy, they're piling on right, hoping to buy high and sell higher. Then there's fear in the markets.

You know people are dumping, uh assets right at you know. At wholesale i mean at buck number of orders. It just keeps selling and that forms a downtrend. So, in the long run right as long as humans have fear and greed right trend, followers right, we'll be able to profit from this phenomenon number three: when does trend following works? Well, it depends on the type of trend follower.

You are, if, let's say you are a longer term trend follower, then clearly you will make money right in sustain long period or prolonged trending environment, maybe on a daily or even the weekly time frame, and when doesn't trend falling works again it depends on the type Of trend following trend follower, you are, if you're a longer term trend follower, then short term trends right will actually cost you money. You won't be able to to uh uh profit right from short term friends, since you know, by the time the short term trends uh. It has ended right, that is where you're, probably just entering into the party, where you're a bit too late. So you have to know you know when your trend following strategy works and when it doesn't work as well.

So this is what i mean by you know: getting intimate right with your trading strategy and trust me right. If you can answer these four questions, if you do the work to validate your trading strategy right, you will go much further in your trading career, because now you know that you're trading with something that's proven to work instead of just you know, based on hearsay or Whatsoever right sounds good, so with that said right i have come to the end of today's episode. I wish you good luck and good trading. I will talk to you soon.

You.