A Guerrilla Trading System  

Trading Systems Profiled

There a five tradings systems:

1. System Trading -- A trade is entered and closed based upon a set of rules. The rules can be simple such as "Enter a trade when price exceeds yesterday's high and close when gain equals 30 pips or falls 20 pips below yesterday's high" or they can be complex and based upon a multitude of factors and indicators. System trading is the most common type of trading.
2. Program Trading -- A trade is executed automatically by a computer program based upon a defined set of rules. This is System Trading on steroids. In demo scenarios it can be very profitable, under real time and with real money on the line it can be disastrous. Also brokers and trading desks can impose restrictions that will effectively neuter or even undermine an programmed trade. While many have claimed to perfected a Programmed Trade it is highly improbable that it will work. Any one who did succeed, would in short time be the richest person on the planet as such a system would with leverage allow an account to grow exponentially without any risk of loss. Hundreds of well known traders have tried to execute a Programmed Trading System only to fail time and time again. Don't put your hopes in this perpetual machine myth.
3. News Trading -- A trade is executed concurrent with financial news announcements. When a country's central bank announces it is changing its bank lending rate, you can bet there is going to be an immediate and volatile change in currency values. A currency can move several hundred pips in a matter of minutes on some financial news. Many traders have made fortunes trading based upon news releases. Many more traders have lost their shirts on news as they got on the wrong side of a fast moving currency which will often reverse itself and move just as quickly in the opposite direction as it did at the initial response.
4. Tip Trading -- A trade is executed based upon a tip or recommendation of someone else. The person or organization that recommends such trade usually bases the tip on their trading system but the the "Tip Trader" is trading on faith or belief in someone else. Some trading experts have a great and profitable history with their trading advice, most do not.
5. Hunch Trading -- This is also known as Idiotic Trading. A trade is entered at nothing more than a flip of a coin or a "gut feeling" that currency is going to go up or down or both. Poorly designed trading systems can be worse than flipping a coin. Pyschic hunches are even worse and are certain to give you close to a zero percent success ratio.

A 6th Trading System Revealed

I trade using a system I call Guerrilla Trading. It is aggressive, based upon a broad set of rules, hard to define, and requires very quick decision making. I don't recommend Guerrilla Trading unless you are just exactly like me.

I do have a respectable history to validate my system. It has (and will) get me 200 pips a week. There are real rules and principles. I just can't easily identify them. Following this blog will define it however.