Trading requires you to operate in an environment with few rules and little structure. Most people need order and rules for guidance. Many of the orders and rules that help to maintain our sense of security in society are imposed from an external authority. We feel there are laws and rules of conduct to protect us if our well being or security is threatened. We can try to change these laws through a governing body if we believe they are wrong. We feel assured the group assigned to carry out the laws will protect us. Finally, we can turn to the court system if we have not received justice.

There are clearly defined rules in the mechanics of trading, such as contract size and expiration date of the contract. However, there are no rules regarding movement of the market. The market is free to trade wherever it pleases. The society of trading (i.e., the market) has no governing body to create rules, no policing body to enforce rules, and no judicial body to interpret rules. This nebulous environment can be an unsettling situation that most of us are totally unfamiliar with. If we think the market should go up when instead it goes down, we cannot petition or complain to our elected officials, call the police, or go to court and appeal the decision. The market does not even care if you make or lose money. The market can trade in the most irrational manner, but it never has to explain its actions to anyone. When trading, we are never far from anarchy, and just around the corner from chaos.

You must create your own reality and rule system, and that in itself can be a formidable task. We are more familiar with accepting the rules of our society, or trying to change those which are unfair. Most of us are inadequately prepared or equipped to create, from the beginning, an entire rule system or paradigm for trading. This process is involved,. and not simply an everyday occurrence we casually do. Yet each trader must develop his or her own unique view and reality of the market.

Many people look to books or gurus for tips on how to trade. Many become quickly frustrated because there is so much contradictory advice and theories on how to trade. There is no place or authority to determine the "proper" course of action-except the arena of the market. You must ultimately determine which trading method and money management system is right for you-not which one is the "best" or makes the most money. It is not enough to create a paradigm, because many theorists do this but never actually test it. The rule structure or reality must work, or it will be brutally uncovered as wrong by the market. A strategy must be created, tested, and constantly applied, but most importantly, it must work.

The game of trading has very few external rules, and as a consequence, many people find themselves helplessly lost in an ocean of conflicting and generally vague advice. The' market can be an overwhelming and nebulous enigma. What worked yesterday may not work today, but may work tomorrow, or may never work again. What strategy should be followed in this type of environment where there is so much uncertainty?

Information and advice from well meaning sources can easily be contradictory and misleading. Anyone actually trying to follow this advice can end up being even more confused after listening and trying to comprehend all the information. This can happen because a few basic rules in trading are obvious. There is no court or judge to resolve contradictions; so any statement can appear true or false and there is no way of confirming it. There are few trading truths because the trading world has few absolutes, but an infinite number of possibilities and maybes.