What separates those who make money in the long run from the others is:
(1) Financial & emotional capabilities to survive a breach in discipline.
(2) The willingness to learn from mistakes and to NEVER repeat a mistake already made.
The cruelest paradox in futures trading is that a trader's short-term successes can plant the seeds of his long-term failure. Believe it or not, one of the worst things that can happen to a first time trader is to have great success right off the bat. In the long run you may actually be better off if you struggle a little at the outset, develop some respect for the markets and weather some early mistakes, than if your first three trades are big winners and you decide you've got "the touch."
A lack of discipline in trading is almost always the result of one or more of the three great obstacles to trading success:
(1) Fear (2) Greed (3) Ego
Futures markets do all kinds of unpredictable things. They go up when everyone thinks they are going to go down. They go down when everyone thinks they are going to go up. They may have no reaction at all to a major piece of fundamental news. They may have a big reaction to a seemingly trivial piece of news, etc. None of which makes the least bit of sense. And therein lies the rub. Intelligent people like things to "make sense" to them. If something does not make sense to them then it needs to be analyzed so that an understanding can be gained. In futures trading trying to understand exactly why something is happening can be a costly exercise in futility.
One key to longevity is to know the following: The markets will frustrate you and inflict pain upon you from time to time. This is simply a fact of trading life. The trick is to not frustrate nor inflict pain upon yourself. The markets are going to do whatever they are going to do and there is no way that you can control them. The only thing you can control is your reaction to market events. Your best bet for doing so is to have a well thought out plan and to follow it precisely. If you succumb to fear or greed or ego you become your own worst enemy.
