Hi TraderABC,
You actually answered every question raised here in your first post without even noticing!
You gave the example with the alien learning to play CHESS.
"Chess" actually crossed my mind a few days ago while surfing traders forums and running into the same over-asked questions/facts (90% fail..., new system that works..., new indicator...).
Here is what I came up with, and if you give it a little thought, you'll see how everything suddenly becomes clearer:
TRADING = PLAYING CHESS.
(with one exception: in trading, only YOU can lose, not the other party)
This explains everyhing. I mean EVERYTHING!
You are playing against the "market". Who is the market? I don't know. I don't really care. Banks, brokers, whatever, doesn't really matter.
Let's say you are new to chess. You want to start learning.
You buy books with rules and strategies (they all look the same). You learn basic moves, advanced moves, more complex strategies. Everything is understood.
Now you start playing against Kasparov (in trading: "the market"). But he kicks your ass! So you play another game against him. He kicks your ass again! And again! And again! What's happened? I learned the rules, I learned strategies, how come he's beating me all the time?
So you switch on your computer and start surfing the web. You run into some new strategies and chess forums, where you ask more experienced players for advice. They show you where you went wrong and give you some more strategies.
From time to time you'll run into a new thread starting with the words: "New system was found". In this thread, a player will demonstrate how his system works (ie, "when the bishop is on A2 and the queen is on G7, move 6 steps to the left"). He will give you some nice examples where this strategy/system works. In just 2 days, the thread will contain around 100 posts of newbies jumping over the new winning system, trying to improve it a bit, but all of them sure that they have found the holy grail. Kasparov, watch out!
You are one of them. You write down the new strategy and challenge Kasparov to the battle. And, what a surprise, it works! You have taken down one of his pawns! And then another one. But then, in a flick of an eye, you get check mated again. Bummer.
So you go back to the forums and ask the experienced players, what happened? They explain. They say you need to practice. They say that the strategies work MOST of the times. They say you need to WAIT for the right situation in order to activate the strategy. They say YOU NEED TO PRACTICE!
90% of those who started to learn how to play chess have quit! Why?
Maybe they didn't like the game.
Maybe they lost so many times that they have decided to give up. Instead of learning from their mistakes, consulting more experienced players, practicing, practicing and PRACTICING, they decided that all the books written by world champs are the same and are used to fill the champs' pockets. They decided that the strategies don't work. They have found out that playing chess IS VERY VERY COMPLICATED AND REQUIRES CONSTANT TRAINING AND HARD DECIPLINE ACCOMPANIED BY LOSSES OVER LOSSES, FRUSTRATION AND A STRONG URGE TO QUIT.
The rest of the players who have made up their minds that they wanna become real chess players will continue practicing, learning, asking questions and one day they will know how to play chess.
They won't beat Kasparov, but they will cause his heart to miss a beat or two. They will have great moves followed by losses, but the winning moves will shade them.
Some of the players will be better from the others. Some will make a career out of it. Some will do it for the fun of it. One thing will be common to them: they are now chess players.
I think it's very easy to see the similarity to trading.
IMHO, as long as you understand this and willing to become a trader, you'll be one.
Astro.
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