Apart from being constantly aware of what happens in the markets, both in the charts and at the political / macro news space, a trader must be able to control himself/herself and not trade.

This is easier said than done, mostly because of the complexity of this action, which requires inaction not only when prices aren’t moving, but when volatility is high as well.

The main reason it is so difficult not to trade is the human brain. Even the most capable trader, and in particular the expert trader, will be able to see patterns, recognize previous behavior and take into account possible macro events. In short, the seasoned trader will be able to analyze any market.

This mythical expert and capable trader will also know that during certain months, timeframes within the day or timeframes prior to some big news approaching, whether it is hours, days or weeks, price action in the charts can be deceptive. This same knowledgeable trader, comfortable with risk due to experience, might be easily fooled to take action against his/her better judgement, simply because his/her brain can analyze all of the above and then some. This, in combination with experience and cool of mind, might more easily trick such a trader to take that trade he/she knows he/she shouldn’t.

This action—to take the trade even though the trader knows better than this—becomes even easier, when this expert trader is also good with money management and risk and reward. Because this type of trader will know how to minimize risk based on the knowledge that overall inaction would be better than action.

Technical expertise, experience, constant monitoring of the markets, never-ending learning, patience, all can be mastered or at the very least achieved at a high level. But not trading, that could very well be the ultimate obstacle to overcome.

What can a trader do to overcome this ultimate obstacle?

As with everything, practice. Even doing this is difficult. Because no matter how good a trader is at money and risk management, taking trades when it would be best not to, chips away at every trader’s capital.

No matter how good and/or lucky a trader is, in the end, taking trades during periods one knows shouldn’t, results in losses. And even though in the end the trader may still be profitable, it is nevertheless still a burden. A burden, because it keeps away the trader from realizing his/hers full potential, because it affects his/her psychology and because—unless it is overcome—it will always be a big risk, a risk which could ultimately result in a big loss and even an empty account.
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