The answer may be both. I have chosen to take the route of trading as an art form. A good scientific approach will back test, back test, back test, looking for the best results. My problem with this approach is that it may work for a short while but it is bound to suffer the changing winds of the markets. How do you know what strategy to deploy and at what time, for how long?
This is where I believe the art form of trading comes in. The human element cannot be duplicated (not yet anyway). Prop firms that use Gray Box trading are making the best of both elements. Science has found decent strategies through back testing and those trades are taken automatically by a trading robot. These Prop traders must then assess the current markets conditions and use their skills as a trader to target and exit the position. This is where the art form part comes together. A painter or musician will find their own "style", taking influences of others along the way. The path of a new trader is much the same and in my opinion an open art form.
Since I am still a 100% discretionary trader, I rely on the art form approach in my trading. I am open to the possibilities of Grey Box trading perhaps in the future. But for now, I make many decisions during the day to take the trade or not take the trade? How much to risk? Whats my downside? Whats my target objective? What will I be monitoring during this open position? The answers to these questions come from intuition, rules, and money management.
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I agree. I believe you need some sound reasoning abilities,as far as technical analysis goes, then a trading style that fits your personality and comfort zone. The hard part for me personally is allowing my equity to drop in order to make money, which is obviously going to happen whilst trading!
PS Nice to see you guys have started a blog...I always get alot out of your videos so I'll be checking this out also :o)
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