I think we’re gradually evolving to balance our intellect with our intuition, learning to use all of our brain… give it another few thousand, million years…

Life’s all about making finer and finer distinctions isn’t it.

Your last paragraph prompts me to ask: What does everyone think – is Trading an Art or a Science? (I believe both).

… but of course sometimes as we learn to start seeing more and more patterns within patterns, our minds start to get confused to the point that we begin to doubt are own “childlike” judgments that we should have followed in the first place. It is this period that often creates the learning curve. First we trade well, some people call this “beginners luck”, in fact what it is, is that the person sees the very simple “childlike” pattern and trades off that, that simplicity can sometimes be true and hence he wins. The next stage is that of the mid-loser stage, this is when we start to learn the complex patterns but haven’t yet deciphered which or how we are supposed to follow them, as one tells one story and another the opposite, this is why the mid-stage always loses. The last of course is when the brain finally “cracks the code” and discerns major patterns from minor patterns etc etc …

That was what I said earlier after you crack open the nut shell and spread everything out on one long bit of paper.

[By the way, this might all sound like I am one of those scientific people who thinks everything has a clear logical explanation to it, in fact the opposite is true, its just that I think that the true higher levels of intuition, are not the ones we so easily attribute to our own and don’t necessarily include psychics and a whole load of other garbage either].

I personally believe that we do have the ability to tap into the ether and find answers to past, present and future. I see it as a collective consciousness, one that we all contribute to and pull from both wittingly and unwittingly. While I’d LOVE to be able to do that with my trading on purpose it makes sense to me that, like with anything, a willingness to contribute to that larger community through practice and presence is what will ultimately tap me into it and help me abandon the part of my brain that over-thinks everything (even trading) and meld with the part of my brain that just knows.

What I personally believe is, of course, irrelevant however because ultimately we must stay in practice long enough to develop any strong sense of trading anyway – I guess what I’m saying is that it is a happy medium (for me) to be able to look at the practice of trading as my ‘now’ assignment and appreciate the insights that come from that regardless of whether or not they actually make me psychic about the market, because they’re still bound to make me a better trader. The rest will just be gravy.

I really like where you’re going with your 2nd paragraph… yes, the human mind is a meaning making machine (Viktor Frankl was right). We like to put an order and structure to everything around us. As it relates to the market, I guess until we put some kind of framework around it (eg. candlestick patterns) does it start to make sense. But this is just the ‘survival’ stage, and these *basic* elements initially only allow us quick recognition, like a fight or flight response… is it safe to enter or not?

Aby, is this what you meant when you said ‘this is what makes trading easy and hard’ – that mere pattern recognition is only 1 tiny piece of the puzzle?
What do you think comes next??

And just for fun, POP QUIZ: What makes a pattern in the market and more importantly why do they repeat?

Incidentally, Curtis Faith talks about a need for understanding market structure/framework before intuition can come in… Did I mention this was fascinating reading?

PS. Did you know that there is actually a Pattern Recognition Theory of Humour?! Seriously, no joke! ;D

What i’m saying is that the brain is very good at scheduling, if something creates a pattern the brain has a remakable capability in mapping that out, hence a lot of these IQ tests are based on continuing a pattern (as in whats the next number in this series etc …) this actually makes trading easy and hard, at the beginning the brain see’s everything as unpatterned, so has no idea where to go, hence your ability, Yaqui, to easily predict the caller eventhough according to you it could be 1 out of 100 people in your phonebook, yet to simply predict an up and down move, which is a 1 in 2 chance, you are stuck … what we do is invent parameters or systems whereby the brain can start mapping out the movement of the market in relationship to other factors, this creates a pattern, a schedule, which the brain learns and like 1 3 5 7 9 11 … ? the brain knows the next move of the market …

Thats all there is to know in a nutshell, the other stuff is either irrelevant or wrong, otherwise all psychics wouldnt be conning us they would be down at the tracks making real money !!!

Was eagerly anticipating this continuation piece and your thoughts Triffany, thankyou. And it’s much simpler than I’d thought, the process, a nice intro.

Re: Hutch’s Livermore excerpt, I think that’s a higher level of intuition than most have access to and indeed truly comprehend. Touching on the esoteric, I have no doubt there are realms of awareness beyond 5-sensory perception. Alot of us have everyday intuitive experiences, I know I have (eg. sensing who is calling you before you answer), which are just the tip of the iceberg. But as it relates to trading, nothing on the spider senses for me I’m afraid.

PS. Have just struck G-O-L-D. If anyone’s even remotely interested in Trading and Intuition, ya gotta pick up a copy of Curtis Faith’s “Trading from your Gut” (Turtle trader). Talks about exactly what we’re discussing here and more, including Hutch’s blurb!! Will speed read it in time for Part 2′s article… Fascinating, fascinating!!