Regarding the article "Trading As A Business" (Or:Are successful systems automatic?)

Hello all,
I've read the excellent article "Trading As A Business" by Charlie Wright (got it from the sticky-thread "Information for Beginners" in this forum. Link: http://www.elitetrader.com/tr).

Wright describes the path to being a successful trader in 4 phases:
1 - The Discretionary Trader: "A discretionary trader uses a combination of intuition, advice and non-quantifiable data to determine when to enter and exit the market".
2 - The Technical Trader: "A technical trader uses technical indicators, hotlines, newsletters and perhaps some personally defined objective rules to enter and exit the market."
3 - The Strategy Trader: "A strategy trader trades a strategy method of trading that uses objective entry and exit criteria that have been validated by historical testing on quantifiable data."
4 - The Complete Strategy Trader: "
The complete strategy trader has learned to use advanced cash management principles, trades multiple markets, and may trade multiple strategies in each market."

To anyone who have not read this article I'd mention that the author teaches you to use strict rules for entering and exiting a trade. there is no place for discretion of any kind, which makes the system automatic.

Now to my questions:
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1 - Do you agree with the 4 phases? did you experience those phases on your own ? Personally, when I read I thought he was talking about me.. I'd like to know if it's really like that for most traders.

2 - Are you successful traders use no discretion at all, and base your strategy only on strict rules that have been back-tested many many times? Do you really don't care about the single trade and it's all about what the strategy does in the very long run? Does this mean that most successful strategies can be traded automatically? Do you even believe that one can find a successful strategy that can be traded automatically without him paying attention? And where does discretion comes in in successful systems if at all ?

Sorry for the long post...
I'd really appreciate your comments & thoughts about what I asked.

Thanks a lot !

If you were to read the first two Market Wizards books by Jack Schwager, you'll find a variety of successful (we're assuming they're all telling the truth) traders using a variety of methods. Some such as Seykota are pretty much mechanical, while others like Kovner are more discretionary.

The bottom line is that to say definitively that you must do ABC in order to be a successful trader is nothing more than an opinion. If you look throughout all of life's endeavors you'll find similarities among successful people but you'll also find a huge amount of variance.

In other words, the guy's wrong.

theres a step no. 5

it goes

5 - The Discretionary Trader (level2) : "A discretionary trader (level2) uses a combination of intuition, experience and non-quantifiable data to determine when to enter and exit the market".

then 1-5 all over again on the next level...

I don't fit any category, well not as he's compiled them. This is me..

1. The Odd-Ball Trader: "A discretionary trader using a combination of intuition, technical indicators, and perhaps some personally defined semi-objective rules to enter and exit the market."

I agree with Wright to a point.

I would say that all traders are discretionary not matter what level of success you are on now.

The more successful I become at forex, I am finding the more finely tuned and discerning my discretion becomes.

- I learn to filter out the distracting signals (go for the strong signals).
- Get valuable information from what other traders call "market noise"
- learn to hold on to money more than risk it on the "unknown"
- even so called mechanical or technical traders are discretionary because they are making a discretionary choice to stick with their mechanicals not matter what other impulses they feel.
- traders who succeed use Disciplined Discretion.

There is no one way, intuition however is just another word for luck in this game.
Most of the very successful traders I know are mechanical, but not all of them, however all of them are very logical, perceptive thinkers.