Trading Ideas For The Weekend http://www.netpicks.com/trading-ideas-for-the-weekend/

For me personally, it has always been a useful exercise for the weekend to

muse on trading ideas I've come across during the week or have resurfaced somewhere from the depths of my

mind.

It gets me thinking in different ways and can inspire a degree of creativity, which can be sorely lacking during the

trading week.

One such idea to consider is the common notion is that trading is a

simple game but not easy.

Why should that be?

The simple side of trading comes down to most concepts being pretty straight

forward. Chart patterns, economic releases, volume etc. all have simple

ideas at the heart of it.

But markets are made up of the people who trade them and although

people are often driven to act for simple reasons, it's not always clear what the scenarios are that lead to

their actions.

I want to be very clear on the definition of "complex" here because I realize that this is a point some people

will contest.

Complex

made up of various interconnected

parts; composite (of thoughts, writing, etc) intricate

or involved

Complicated

made up of intricate parts or aspects that are difficult to understand or

analyze

These interconnected parts do not have to be complex in themselves.

They can and often are very simple.

But it's the amount of these ideas, which makes trading complex and often causes it to be complicated,

when the relationships between each constituent part are not always

certain.

Uncertainty is a big stumbling block. 2 + 2 does not always make 4 as far as

the markets are concerned - at least as far as traders can decipher. So reading what the markets might be about to

do is an art of sorts.

Dealing with the uncertain nature of trading can be a struggle emotionally

and cause traders to act in a way other than what was planned.

So the point is that trading is simple and complex at the same time.

Because of this, it's certainly not easy - otherwise everyone would be great at

it right?!

Another idea worth considering is about the nature of traders. As a

trader, is it better to be a specialist or a generalist?

In nature there are obviously many

examples of specialists and generalists.

Specialists can live in a certain environment and are well adapted to a

certain food sources. Koalas and Pandas spring to mind as having specialist diets of eucalyptus and

bamboo respectively.

Generalists can survive in different habitats on a relatively varied diet.

Examples of generalists might include bears and rats.

Using this analogy as applied to trading, habitat might be the market

that you trade and the type of strategy you employ could be considered your diet. Both specialists and generalists exist in trading and have their place.

Specialists have an intricate working knowledge of the market they trade

and might also be experts in a particular strategy.

Generalists can move from market to market and trade different strategies based on the opportunities that are

present.

History tells us that it tends to be generalists who stand the test of time. But it's important to understand what

a generalist should be.

Being a generalist doesn't mean that you can't be an expert in single

markets or a particular strategy. It means that you are good

understanding the core market mechanisms and identifying the

current climate in different markets.

The key questions a trader needs to ask themselves are, if you're a specialist trader, do you have a

superior understanding of the product you trade and the strategy you

employ, or are you simply trading one market and one strategy because it's

what you know?

If you're a generalist who hops from market to market, strategy to strategy,

are you doing so because you are recognizing underlying shifts and

opportunities or is it because you just don't want to miss out?

I hope you decide to start spending a little time considering certain trading ideas as it's my belief that this kind of thought can lead to breakthroughs in understanding about our own trading.