Well the quick answer is, “the profitable one”! If only trading was that simple. Every blog or website you search says “Best Strategy for Trading” or “Strategy for Beginners”. So just pick one and you”ll be a millionaire!
Not so fast Wolfie. In my limited time being a full-time trader and learning from some true professional day-traders, I notice a strong bias on Twitter from traders who have found a strategy for them. Every trader who has found some success will tell you till their blue in the face “why their trading strategy is the best and everyone else is wrong, I mean dead wrong”. The reality behind it is while they all may have a consistent, repeatable, profitable strategy, it doesn’t matter what your strategy is. The SEC doesn’t determine or limit you to any specific strategy! Truly their isn’t any rules at all around what strategy to use or why. The only thing that matters is you can repeat it day in and day out as well as make profitable trades from it. You know why a washing machine is so efficient? Because it does the exact same thing over and over every time, wash, rinse, repeat.
In my opinion you should spend the first few years of your trading career learning as many trading strategies as you can. Be like a hippie in the late 60s, experiment with everything and often. Keep your mind open to different ideas, try new things, absorb as much as you can from other traders good or bad. Some of the best lessons in my life were learned by watching someone who did things the right way and someone who did it the wrong way. I know traders who watch flow, don’t ever look at flow, use technical’s, don’t use technical’s, use 1 min charts, use 60 min charts, play the news, don’t read the news, draw lines, can’t even color in the lines, just trade 1 stock, trade 100 stocks, and on and on. The point here is there are literally thousands of strategies in Wall Street that work, the key is finding what works best for you.
There are a few other things you will need to understand when finding your strategy but based on your personality, your risk/reward, your comfort level, your short-term and long term goals if you provide yourself time, you can figure it out. Personally I’ve taken a blend of strategies from all those I’ve learned from to build a strategy that works best for me. So regardless of what someone on Twitter may tell you, just ignore the noise and focus on you. Nobody else is responsible for your trading except you. It amazes me how many times I see someone put down a strangers strategy without even taking the time to understand why that person uses that strategy or what went into determining their strategy. Do they even know their goals? Their risk/reward? Their personality? Probably not but one nice thing about Twitter is the block button. If the noise becomes too loud, block it out.