Trading Signals vs. Patterns vs. Setups vs. Strategies: Why a Personalized, Profitable Trading Strategy Is All You Need for Consistency
We’re going to break down some terms that often confuse traders such as signals, patterns, setups and strategies and explain how they differ. We’ll also discuss why having your own personalized and profitable trading strategy is crucial for achieving consistent success rather than only relying on signals, patterns or setups. Think of a signal as a green light that tells you to go, they’re the hints the market gives you like when you start the car.
Patterns are like the engine parts of the car and they give you a bigger picture of how the market moves and setups are your car ready to hit the road. They combine signals, patterns and give you a good chance to make a successful trade. But the more important part is your strategy which is the blueprint for your entire journey.
Comprehensive Deliberate Practice Training System
It’s not about just starting the car and hitting the gas, it’s about knowing where you’re going, how to get there safely and what to do when the road gets rough. And unfortunately, due to a lot of misinformation on internet and social media, many traders think that by learning and relying on signals alone or patterns or even setups under certain back-tested conditions, they can reach consistency and remain consistent for a long period of time under any market condition. But that is not true and the major problem is whatever you see by influencers on social media, most of them are not in fact a strategy.
They’re mainly setups made of some entry signals and patterns and you have to understand that strategy is just more than a setup and you will see that the one-size-fits-all approach doesn’t work and you need to have a trading plan that fits your personality and trading style perfectly. And just like driving, trading comes with many risks so you have to first understand and master the safe driving skills, master your vehicle and know your instruments and software and the market you’re trading and understand the true nature of trading and journey on this unpredictable road that’s constantly changing and apply proper risk management based on your level of skill and risk tolerance. Because you’re hitting a very dangerous road with many twists and turns and by not mastering this personalized trading plan that incorporates all these elements, you’re going to end up like other drivers here that never reach their goal of consistently making money in the market.
Constant Monitoring by a Coach
A coach must provide 1-on-1 immediate feedback to each learner and constantly monitor their progress to ensure they are advancing to their full potential.
Smart Deliberate Practice Drills
With the advent of innovative training systems and simulations in the recent years, it is possible to develop live computerized smart drills that provides instant feedback.
These smart drills mimic real-life situations, providing a valuable virtual learning experience without the risk in trading. The “show me” aspect of the drill allows active learning and feedback in real time, demonstrating the instant consequences of an action based on a learner’s decision. All of these are important in development of skills related to the process and algorithms of a trading system. Most importantly, a new trader gets the benefits of deliberate practice without the risks in trading which can cause money to be lost in the financial markets while they are still learning.
Learning Management System (LMS)
By embedding smart drills within a modern learning management system for trading, or LMS, the system acts like a live 24-hour coach, providing a dynamic training environment with prompt feedback and constant monitoring of the learner.
The training process is designed to be identical to the process and algorithms of a profitable trading system, creating the skills of the best decision-making and habits of confident execution over time.
The learning management system for trading evaluates the learner’s level automatically by challenging students with various tests and guiding them to the appropriate set of drills to reach a higher level of competency.
LMS has the advantage of gamification, which allows traders to be fully engaged and have fun learning, while solving difficult problems and practicing complex drills for a holistic skill development experience.
Smart Drills under Learning Management System for Trading
Smart deliberate practice drills under a learning management system for trading puts you in control of your skills and overall trading development. You can practice to become consistent, instead of trading randomly under stressful and risky market conditions that creates bad habits and losses.
This concludes our discussion on the second important element of professional traders’ success, which is “Mastering the Execution of a Profitable Trading System”.
For an overview of 3rd secrets of professional trader’s success, which is “Resolving the Human and Market Psychology Conflict”, please click on the link below to read about the Price Psychology Action vs Price Action.
Introduction to Trading Personalization: Understanding its Crucial Role in a Trader’s Success https://youtu.be/c1-0XvoJeLc This lesson of module 12, workshop 34, I will discuss the topic
Advantages of High Probability Trading Setups with High Win Rate https://youtu.be/eBCC3wdOW7Y we will discuss the advantages of a profitable trading system based on a high-probability
Advantages of High Probability Trading Setups with High Win Rate we will discuss the advantages of a profitable trading system based on a high-probability trading