NEW YORK (TheStreet) -- Do you have a trading edge? If not, how do you go about getting one?
The market is a tough place to earn a living, with the majority of profits going to a minority of traders. Members of this elite group have one thing in common: They all trade plans with proven edges. It's often self-taught because well-known strategies encourage a huge crowd to trade in a specific way. The sheer number of participants ensures the methodology will carry no tradable edge at all.
Contrary to popular opinion, basic technical analysis offers little or no edge to traders. But don't dismiss this valuable tool just yet. Buried between the lines of your favorite patterns and indicators are unique trading styles and methods that work well in the long haul. You can access these power points by getting a basic education and then setting off on a personal journey that fully explores TA's day-to-day applications.
Take a few steps down this path and then build your own set of observations about market dynamics. Catalog the moves that catch your attention and deconstruct them. How did they start and how did they interact with the chart? Have you seen this type of behavior before and, if so, what happened next? What kept you out or got you into the trade the last time? These small Q&A sessions can become the basis for building a lifetime edge.
Trading with an edge requires a mental process that looks like intuition, at least from the outside. Profitability comes when we act naturally on analogs to patterns and situations we've already experienced. This accumulation of knowledge lets us act spontaneously as the environment changes, with the sum of our observations and recognition of past mistakes forming the basis of our profitability.