When considering a change of profession to become a full-time market trader, there are numerous planning considerations that a working professional should take into account: Assess Your Passion for Trading: Famous traders often emphasize the importance of having a strong passion for the markets. Without it, the daily grind of trading can become burdensome. Educate Yourself: Before making the transition, it's crucial to educate yourself about different trading strategies, financial instruments, and market behavior. Financial Cushion: Ensure you have enough savings to support yourself during the initial phase where you might not make a profit. Risk Management: Understand and apply risk management techniques. Never risk more than you can afford to lose on a single trade. Develop a Trading Plan: A well-thought-out trading plan is vital. This should include your strategy, risk tolerance, and goals.

It is during the preparation phase that the trader will conduct critical rehearsals of important decisions with as many iterations and scenarios as is practical and useful. The best rehearsals duplicate the conditions under which the decision in question must be made. A trader’s rehearsal, therefore, could include reviewing critical chart patterns or practice trading with a trading simulator or paper trading while the market is open or prototype trading with very small position sizing and real money.

Dr. Ken Long, a renowned trading expert, adopts a unique approach to teach traders how to effectively analyze reward and risk when trading in the financial markets. He developed his own trading framework known as the RLCO (Regression Line Cross Over) which is applicable to multiple markets, including equities, currencies, and commodities. This framework allows traders to make more informed decisions by evaluating market conditions comprehensively. By understanding the different regimes, identifying key market locations, considering various conditions, and selectively acting upon potential opportunities, traders can effectively assess the rewards and risks associated with each trade.

LESSONS LEARNED 

0. Forgiveness for the trading I am about to do, gratitude for the trading I have done.

1. Know the market condition. Have a market condition framework that is useful in your time frame for typical holding periods: stable enough, but sensitive enough

2. Have a stable herd of standard targets that have behavioral characteristics that are linked to your typical holding periods

3. Use performance stats as a market condition

One of the regular traders in our trading mastermind has made a successful practice of focusing on just a few stocks and ETF's in his short-term trading strategy. The rest of us have seen him develop an almost uncanny ability to anticipate his targets reactions to news, behavior at certain important price levels and generally stay in tune with the changing price action a day-to-day basis.

The style of trading that works best for me is a combination of discretion and rules based systems. Sometimes I start with a framework of rules and then apply some discretion in the gray area between the rules. I see this as mostly systematic trading with some discipline and discretion. In other circumstances I start with a discretionary reason to trade, such as a favorable reward to risk ratio in either direction and then add structured rules to govern risk timing position sizing and exits. I think of this style as being artistic with the addition of structured discipline. In both cases I believe that both forms of trading are a type of craft knowledge.

Trend following is one of the most powerful practical trading strategies available to you as an individual trader. It is suitable for multiple time frames and multiple markets. In a very real sense, all trading strategies regardless of time frame incorporate some aspect trend following except for purely random entry systems.