#1 Reason Most Traders FailI’m sure by now you have read many articles about the #1 reason most traders fail:

  • Undercapitalized
  • Trading too many markets
  • Using the wrong tools
  • No discipline

and at least 50 other reasons, if not more.  But, in my opinion, it is one major reason — a lack of true understanding of their charts.  Yesterday I received an email from a client thanking me for another post I had done about the reason most traders fail.  But one of his comments was really telling of what most traders do.

He said:

I have traded a long time, and I sat last Thursday and Friday very confused, but I felt as if the charts were talking to me this a.m. just as when you went through the setup and what you saw looking at all the time periods.  I was afraid to trade, but it is getting better.  I see PATIENCE is very vital.

He has loads of experience but was confused with the charts on Thursday and Friday.  The major movement on Thursday, happened during London (not the US session).  Then on Friday, the only signal that was valid did not come until around 2:30 in the afternoon.  The rest was a reaction to a wide bar that happened after market reports.  There was a lot of confusion in the market on Thursday and Friday — which is why he sat very confused.  The CHARTS were saying don’t even think about it!

Then yesterday, everything lined up, just as it should with the THD indicators and methodology.  The charts were speaking to him and saying the entry should be to the short side.  However, after feeling so confused on Thursday and Friday, he was scared to trade but he did anyway.  And, it was a good trade.

What this particular trader needs to realize is simple — when there is clarity and the charts are speaking to you, that is what we call “IN THE MOMENT”.   You understand your indicators, charts, and you are listening.  Everything is working out exactly as you know it should.

#1 Reason Most Traders Fail

And, when there is confusion — there is no “IN THE MOMENT”, which is the #1 reason most traders fail.  The charts and indicators are really trying to tell you there is no confluence, no rhythm, nothing working as it should so STAY OUT.  The problem is that most traders allow other thoughts to prevail.  Instead of thinking, this is not the time to trade, they opt to allow thoughts like:

  • I need to trade
  • I don’t understand the indicators
  • The indicators are not working
  • I should be in this trade
  • I don’t know what I’m doing
  • Will I ever get this?
  • I am so confused

And that lists goes on and on, as well.

This is why I teach patience and provide the Trade Flow to help you walk thru the charts, time frames, indicators, and then it is really as simple as yes or no, entry or no entry, as well as many other tools to help you to identify and stay “IN THE MOMENT”.