The Traders’ Dilemma: 3 Questions Every Trader Should Ask Themselves

October 25th, 2022

According to Ted Hearne, every trader faces the same dilemma.

Hearne is the president of Drummond Geometry, where he develops trading software and mentors individual traders. He recently joined the NinjaTrader Ecosystem to present his webinar Uncover Hidden Market Structure. In that event, he explained what he calls “The Traders’ Dilemma.”

The Traders’ Dilemma involves three main questions:

  • What is going on right now?
  • What is going to happen next?
  • How do I handle market volatility?

Let’s review each.

Question One: What is going on right now?


First, you need to be able to evaluate what is currently happening in the market. Is there an active trend? If so, in which direction? How fast is the market moving? While there are charts and analysis tools available to help you answer these and countless other questions, simply having access to data isn’t enough. Being able to interpret what the various data sources mean is one of the foundational steps to consistent trading.

Question Two: What is going to happen next?


Once you understand current market conditions, the next step of The Traders’ Dilemma is to evaluate what might happen next. With all the charts, patterns, theories and systems available, the answer should be straightforward enough. But unfortunately, it isn’t so simple.

In fact, predicting what will happen in the markets next is an impossible task. Hearne said that market movement is caused by the silent, internal decisions made by all of the many players acting in the market. Unless you can read their minds, you will never be able to constantly predict future market moves. In an environment where the decisions made by even just one individual can move the market (if they have enough capital behind them), unpredictability and volatility are inevitable.

Question Three: How do I handle market volatility?


How do you make educated, calculated trades in such an uncertain environment? Every single trader will have their own unique way of answering this question, using set of systems and ideas that go into their trading plans.

The key, then, is not to solve The Traders’ Dilemma, but rather learn how to trade with consistency despite it. Of course, that’s easier said than done!

For more information on how Hearne and the rest of the Drummond Geometry team use market structure to inform their own trading system, you can watch the full-length Uncover Hidden Market Structure webinar for free now!

Then, be sure to check out all of the other archived trading events that are available to stream for free via the NinjaTrader Ecosystem Video Library. New events occur weekly, so be sure to keep an eye on our Upcoming Webinars Page as well. You can view a full schedule of upcoming events there and register to attend live (for free)!

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