What Separates The Professional Trader From The Average Trader?

Professional traders trade to make money for a living.

There are a lot of traders out there that strive to achieve that goal of making enough, or more than enough for a living.

To be a professional trader, though, a person needs to think like one and practice like one, or their trading will only ever be on the level of hobby trading. The professional trader sees the market differently and thinks with a supplier verses a consumer mentality.

They can do that because they know how to read the markets. They know how to filter out the noise and have proper expectations of market movement.

The average trader thinks when the market gets to a certain point, they’re going to buy, because they think that’s where the market will take off and go up. Or, they think, when the market gets to another point, they’re going to sell, because they think that’s where the market will dive and go down. If the orders are going to come together at these pinpointed resistance and support levels, or Fibonacci levels or whatever other master level out there, and if you and everyone else are trading from there, why not be the trader who supplies the other side of the contracts? Those areas, those levels, those typical entry points are where you and most traders think the market is going to bounce, that you can take a swing trade off of it. And, almost always you’re right. The market does get to those points, but how often are you right on where the market goes afterwards?

The professional trader anticipates, identifies and see’s that the market is going to go “there”, they enter now and take advantage of it. The professional trader reads the market and knows those levels. Where everyone else is waiting for the market to get to, in order to enter, the professional trader has already entered. They’ve set their take profit points at where those entry orders are, thereby being the supplier, filling waiting entry orders. The market moves in the direction to where the orders are waiting to be filled because that’s all that markets do, they exist and move to fill orders. In essence, to be a supplier of the other side of the contract, you need to think like the professional trader, and be one step ahead in your thought process.

To think like a professional trader, you need to read the markets like them. They use price action, expected movement and volume, the three essential components of trading. You need to see clean noise filtered price action. Many traders still use time based bars for the majority of their trading. There’s no reason to see another bar on your chart just because the earth rotated and time passed. Minute bars are choppy,making indicators go choppy and then your charts are messy. Using tick based bars, a bar will only print if price has moved, therefore keeping a chart clean. Seeing bars that print only when price moves makes it easier to catch the trends and reversal trends and read indicators, when you need to. The bars should be accurate tick based bars that show real movement and volume. Professional traders don’t rule minute bars out completely but use them for specific reasons and test them for such reasons.