How I know when NOT to trade.

30 Sept 2026 · 1 min

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0:35

In this segment of the video, the creator explains that long‑term trading success hinges on recognizing when to stay out of the market. The discussed system is a trend‑following strategy that thrives in clear, unidirectional (trending) markets but breaks down during ranging or sideways conditions. While the system is described as “really profitable” when the market is trending, its performance deteriorates sharply when the market lacks a clear direction. The speaker emphasizes the importance of avoiding trades in ranging markets to preserve the system’s profitability.

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Eventually, the conditions where the market is just pumping straight up is going to come back and things are going to be a lot easier. But part of what it takes to succeed in trading, especially in the long term, is learning when you should stay out of the markets. And for this system in particular, it absolutely just gets destroyed when the market is in ranging conditions. After all, this system that I'm trading right here, which by the way is a really profitable system, but at the end of the day, it is a trend trading system, which means that it's optimized when the market is moving unidirectionally, which basically means like it's going in one direction. Now it doesn't need to be fast, but it needs to be clear and trending, and that is when this system performs the best.