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Trend Trading For Dummies by Barry Burns

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Chapter 27

Ten Common Misconceptions about Trend Trading

In This Chapter

arrow Busting the myths about trading successfully

arrow Finding what works for you and sticking to it

Trading is deceptively difficult. In other words, it looks easy when looking at charts from the past. You can look at a historical chart and easily identify the times it would have been best to enter and exit the market.

Hindsight is 20/20, and when looking back on charts, the signs for entries and exits seem obvious. Trading “on the hard right edge of the chart,” where you have to make a decision in real time without the benefit of knowing what will happen in the future, is an extremely difficult thing to do.

One of the primary reasons traders fail is that their minds are filled with misconceptions about the reality of trading. Those misconceptions make trading seem easier than it is. In this chapter, I do you the favor of dispelling those misconceptions now so you can deal with the reality of the professional trading world.

If I Back Test Successfully, It Will Work in the Future

One of the popular approaches to creating a trading system is to begin with a certain idea, translate that into a charting concept that’s mathematically measurable, and then back test it.

Back testing is usually done with a computer program ...

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