Attack vs Defense trading style

Literally, the whole trading styles can be divided in 2 groups, the attack ones, and the defense ones.

Like in a football game, where two teams challenge each other, it is always quite easy at some time of the game to spot who is the attacking one, and who is the defending one.

Hint:
The attacking ones usually end up winning the game.

We can see the same thing happen with traders, there are the ones who have an attack style of trading, and the ones that have a defense style of trading.

At the beginning of a trader career, everybody start on the attacking side.

Usually, the attacking ones have great results until they reach a point in their equity where they feel they have made enough profit, and suddenly and unconsciously they switch style, getting to the defense team.
Or. they face a huge loss and instantly switch to the defense team.

What happen, they don't focus on how much profit they can make anymore, instead, they start to focus on how to protect their capital.

Now that they are on the defensive style, they start placing ridiculous near stoplosses, take trades with a ridiculously high R.R ratio (risk.reward), that again give them a very low percentage of success, or some exasperated traders may as well place some huge bet trying to make a fortune in just one trade.

In many automatic unconscious way, this defensive style of trading is the very reason of the following streak of losses that would lead to the total failure.

There are then the long-term demo traders, the ones who trade naturally on the attacking side on their demo account, but once they switch to real money trading, unconsciously slip to the defensive trading style.
The result of course, is once again failure. I can hear their thoughts: "how is it possible that in demo i have so much success but with real money everything goes wrong?".

Once you fall in the defensive trap, it is very difficult to get back on the attack side.
It take great courage, faith and will power to get back on attack.

Offense wins games, defense wins championships. We are in this for the long run, the longer you can preserve your capital the higher the opportunity you have to survive.

If you allow me I would like to add that the defensive traders try also to avoid risk at all costs and forget that there is no profit without risk.
They forget that they have to embrace risk to get the rewards.

Congrats for your good post.
BT

I believe a good trader should excel in both styles, and know when to get aggressive and attack and when to get conservative and defend.

Nice thread.

The most important rule is to play great defense, not great offense. Everyday I assume every position I have is wrong. I know where my stop risk points are going to be. I do that so I can define my maximum drawdown. Hopefully, I spend the rest of the day enjoying positions that are going in my direction. If they are going against me, then I have a game plan for getting out.

Paul Tudor Jones

for me, i switch to defense mode if i encounter 2 losing streak (which my next trades Take Profit will be aimed to recover >70% previous loss, or >50% if 3 losing streak for example) ...

interesting thread topic,

i would add that the aggressive style is easy to maintain as long as you are winning mostly, but gets very hard if not impossible to maintain in the face of being wrong 2 or 3 times in a row. thats when you start making every mistake in the book trying to get back on top, this make things go even worse. for me taking a time out from trading is best if i lose 3 in a row.

thats why rules are so important, know your plan and follow it. don't let emotions get in the way of following the trading plan.

am learning how to trade price action systematically and its so amazing how much success depends on having discipline and following the rules no matter what just happened with the last trade lol.

Great First Post eldavidoloco

I appreciate the chance to chime in on this thread. Excellent theme, however one that I disagree with. But I will indulge the metaphor. So to "attack" or "defend"? That is the question. "...whether it is nobler in the mind to suffer slings and arrows..." (Shakespeare)

Think of a boxer...would he go into the ring afraid of getting hit? Of course not. He expects to get hit multiple times. Indeed to get in close enough to "win" he will have to endure many hits...But what is his posture? Does he have his hands down? NO! His hands are up in a defensive posture to MINIMIZE the effects of any blows. With this...his expectation of getting hit and his stance to minimize the effects...he becomes aggressive in pursuing his win. From the boxing stand point it is just that...an attack.

As I said in the beginning I am not fond of this metaphor because it assumes an almost paranoid mindset when trading...kill or be killed. And while the results may be just that, the cause is very different.

One needs to understand the market flow and simply place their trade on the correct side of it...then wait. It requires neither aggressiveness nor defensiveness...but a simple calm understanding of where the order flow is NOW. You will not know what it does in the future...and the past has already happened.

Of course there are many moments when you misinterpret the order flow and as such you must limit yourself to reasonable losses...but losses WILL happen. So what? Losses tell you that you are not "seeing" or are misinterpreting the market flow.

If there is a metaphor that is appropriate think of a xiao lin monk. One who trains his body to act with deadly precision but is passive in every aspect of his life. He is "at one" with everything around him and only acts when there is no choice but victory. The precision he learned all his life come into play for one moment only, he acts, and then returns to a state of calm.

If we train enough and watch the market flow long enough we will also "become one" with the market...and know the precise moment to act. It is neither defensive nor aggressive it simply "IS". The trade will or will not produce profit. (notice I did not say win or lose?) Each trade is done in the moment of "right now"...thus there is really no aggressiveness or defensiveness it is simply following what the market itself is doing and thus allowing it to profit.

You brought a clip from my favorite TV series to mind.



(skip first 18 minutes then watch 1 minute : 18:00-18:40)
(This series had cool soundtrack too.. 21:00-22:00 is example)

Sounds fancy but show me someone who can do this successfully on a live account above 10k and produce profits over 12 months and I would believe it's possible. IMO, it's simply an excuse for most beginners not to systematise their trading.

Not intended to offend, just pointing out that this is a common trap for traders to take note. I fell into the trap before so I know.

You're looking at him...figuratively speaking of course

Sorry but point me to your TE link or myfxbook that's live?

You don't have to prove anything ofcourse. But if you want to make a claim, I would rather like to see some proof. It's fine if you don't want to for.. cheers.

Ability to move price means attack. Do you have money to move price?

Wow, i read great contributions on this thread, yet perhaps there is a point of the "attack side" that have been misunderstood:

*** Attack style doesn't mean to trade without caring/concerns about the dark side of trading (the possibility of face losses), or in a boxing metaphor, fight without a defensive guard, nor it means that the trader will buy or sell anything at anytime for the sake of "attack".

The guard/defenses must always be on, and such defenses in trading are:
- A good MM (lotsize), not too much aggressive.
- A good stoploss (not too much near!).
- A good trade reason (not just buying or selling for no reason).
- A good trade timing (waiting the best moment to execute the trade, without hurry).

The difference from an attacking trader and a defensive trader is that an attacking trader enter the market ONLY when he see a clear opportunity to make money, he is focused on make profit, so he really need and want to be right.
He enter with a clear and valid reason, with a perfect MM (not overleverage), a perfect stoploss (not ridiculously small), and a good timing. The chances of success are naturally pretty high (even 95%).

A defensive trader on the other side is mostly focused on the fear of losses that can incur in his capital (this do happen on a unconscious level, so the trader isn't aware of this fact).
The motivations of the defensive trade will be that he don't want to miss an opportunity to make profit, so his timing will be mostly wrong (enter too early or too late), this will mean that the probability of winning of his trade will already be very low from the beginning.
He will then put a small stoploss for the fear of not loose to much, lowering even more the winning probabilities.
He may as well use a wrong lotsize (perhaps too big) in order to counterbalance his wrong timing (i'm entering late so i have to use bigger lotsize to compensate for that), this last thing will magnify the fear of losses, yet making his stoploss calculations even more wrong.

As we see in this example, the defenses of the defensive trader are paradoxically weak and dangerously wrong.
On the other side, the defenses of the attacking trader are well balanced and functional.

From a risk-management point of view, the attacking trader is 100 times better than the defensive one.

What drives the attacking trader is a sense of calm, focus, clarity, patience and humility.
What drives the defensive trader is fear, greed, unconscious emotions, a gambling impulsive compulsive addiction.

This last gambling addiction can be found also in attacking traders, the difference here is that attacking traders are usually well aware of such addiction (it is not on an unconscious level anymore), they have accepted it, have learnt how to deal with it, and somehow are able to control it. He use this conscious addiction as a powerful source of energy that is made available to him everyday.

The defensive trader is unknowingly driven by this powerful energy (the ones that naturally comes from any addiction) with no control over it, all he want to do is be in a trade all the time, he may think he's going after profit or some other higher cause but the truth is that the bigger reason of most of his trades is just because he like the feelings that comes from being in a trade (the unconscious gambling addiction).

You see most of this trading game is about being conscious or unconscious about many things, in other words, is about knowing yourself.

profitable trading is generally very boring. you know you got it when your trading becomes boring

if your trading style is extremely exciting, you probably need to check again

If trading is like boxing:

You can be the guy who throws the biggest punches, knockouts opponents and thrills the crowd. Has a few good fights but fades away as he loses his speed and takes too many hits to the head.

Or you can be Floyd Mayweather, the best defensive boxer ever (arguably), never lost a fight, picks his opponents apart with skill and tactics, gets paid the most, has a face that doesn't look all mashed up, is boring to watch, and laughs all the way to the bank.

A good offense is important, but in a game where you can lose it all overnight, a good defense is CRITICAL to long term success.

Exactly right. I am not trying to convince you or anyone. Merely expressing an opinion. One which you clearly disagree with. OK...that doesn't hurt my feelings. There are many reasons why I do not publicly post my results. Not the least of which I do not want my account made public on any server whatsoever.

Does that make me a liar, or a scammer? While you haven't said that directly, that is the implication if I do not rise to your challenge. So I will just say this. FOR ME (and I suspect many others), the mindset of "attack" or "defend" is unproductive and to utilize that mind set (FOR ME) does not create a pathway to success. IN MY OPINION it is more productive to stop "battling" the market and learn to work with it and "flow" as it does.

You imply that cannot be done...I can say it CAN and has been done. If you need proof of that I'm afraid you will probably never find it...at least not in the form you are currently looking. I'm not here to provide proof or "make claims" that I am wealthy beyond all imagining. But I can say I do it every day, and have taught others to do it as well.

Let go of the battle mentality. Learn to work with the market on its terms and you WILL find success.