Your Unique Psychological Profile

by Chris Lori CTA

The natural process of aiming to succeed at trading in any asset class will lead down countless paths of exploration and revelation. Exploring the endless means by which one can extract money from the market is eternal, because for every participant in the market, there is a unique mind interpreting information flow and making decisions. Exploring, information gathering and the formation of one's Unique Psychological Profile are critical to overall success. In retail forex trading, the patterns are clear, to name a few:

  • Attraction to high leverage - although no leverage should be used when developing (I will produce a video on this, later)
    • Acquire information via internet, books, free courses, free webinars, etc.
  • Indicatoritis - There is an addiction to indicators, because as one goes through the developmental stages lacking confidence, it is believed that an indicator is smart enough to do the thinking for you and that the producer of the indicator must be smart and that it must work or it wouldn't be an indicator in the marketplace.
    • Exploration of systems, patterns, programming, robots, fundamentals and trying to copy exactly what someone else is doing believing it will work for you.
    • Understanding risk and psychology, rejecting risk and psychology and taking trades on little knowledge and high risk
    • the list goes on, but u get the point

Don't be discouraged, every trader goes through this process, but those who ultimately succeed will come to terms with the challenges before them and focus in on what's important, such as; market knowledge, independent thinking, risk management and developing a method in sync with their Unique Psychological Profile.

I was approached by Wiley publishing and asked if I would be interested in writing a book on foreign exchange trading. We met in Singapore and they handed me a box of existing books written on trading. To be honest, I'd only ever read a few books on trading up to that point. I picked one book to read on my flight home to get a sense for how these books are written. It was a book of interviews with successful individuals who traded for a living. Each trader was profiled in a discussion about who they are, their background, what instrument they trade and a few personal philosophies of what made them successful. Personally, I have very little interest in other trader’s methods; rather I'm more curious about how they think. Every trader interviewed
had one common resounding theme. Each successful trader made a point of saying, "This is what works for me."

Independent thinking and having a personally developed method that suits your own Unique Psychological Profile is the one essential quality that every successful trader holds. No exceptions! You get the point? Accomplished traders have explored and learned market structure, fundamentals, technical's, systems, risk models, etc and have refined a method that has been tested to establish a set of parameters that works with their Unique Psychological Profile, or personality. This is important to our training philosophy – teach in-depth market structure so the trader can internalize experiences within the framework of a rigid trading model. The model can draw upon very specific price behaviours we teach, but the uniqueness the model will come from the authenticity of the trader within.

Many developing traders will log into a forum and attempt to copy exactly the method of another seemingly successful trader, and after a few missed trades on a small sample size, move on to the next "system." One reason why this approach generally does not work is because forcing the application of a foreign trading mechanism pushes common sense out of the equation. Only the developer of the method fully understands how and why all the parameters have been established and how to use them. The parameters have been developed with their unique mind and unique interpretation of market movements. Trading on blind faith within parameters trusted only because they work for someone else will push common sense and rational thinking out of the equation and leave one ultimately vulnerable.

I have worked with many traders and see the patterns of those who succeed and those who don't. I clearly understand the process one is to follow to have a chance at success in trading. This is why my courses do not teach a "system," rather what is critical to the success of a trader is building a foundational understanding of market structure at the deepest level. Understanding market structure, price action and what drives price can be adapted by the spectrum of psychological profiles. Once the trader understands market structure at a deep level and has adapted a unique interpretation of the dynamics, they become equipped to formulate a method custom to their own way of thinking (Unique Psychological Profile).

When teaching, I realize people just want to know "when to get in." "Just tell me when to get in!" It's like raising a child you love, you provide them with the discipline that you believe is in their long term best interest. Or like the movie "Karate Kid," where the sensei has the boy doing hours of seemingly useless activities that end up being the foundation to the boys ultimate success in time of battle. Trading is no different.

I work with traders to build their understanding of detail in market structure. What price does at specific times of day, how bank order flow is reflected in price, time of day patterns, data release patterns, what psychological shifts to look for, pre data sentiment, how to identify market inefficiencies and opportunities, how fund managers operate, when to trade a pattern and when
not to, trading with or against flow, assessing probabilities, risk models and price, picking up on shifts in volatility, price sensitivity levels, correlation changes and the list goes on. Once you understand market structure and what drives price, there are countless patterns you can choose from to trade. As well, you will identify and develop your own trading ideas, systems and methods to become that independent thinker maximizing your Unique Psychological Profile and achieving success!

New Course: As many of you are aware, we will be releasing a Price Action and Market Structure course before year end. It has taken some time for the programmers to implement security and anti-piracy measures. We will notify you on release dates.

Pro Traders Club: When you become a member of Pro Traders Club, you will have access to countless hours of archived videos, as well as regular updates and live interactive sessions throughout the week, where Chris Lori provides thorough teachings. Details can be found here