Is trading as easy as the steps you outlined? Who knows, maybe. But it sure hasn't been that easy for me. Which one of those causes people to fail? I'll say look at #4, Risk management is king in this business. #5 is funny tho, it's sure easy when HFT isn't chopping you to death or indecisiveness in the market. Anyone who's traded in the last month or so will tell you that is one of the hardest things to do in the current environment
HFT is bad I agree, but there are ways to mitigate the impacts of HFT. What was worse were the narrow range days a few years ago, with no follow-through. For intraday holds, it was just horrible. For those of us that have been through that can of garbage, trading today is positively luxurious.
You opened this thread describing a single method of trading (with-trend) and a single method of with-trend trading (pullback entries). That is a method, and it's really that easy. I highlighted above the steps you outlined that cause most traders who follow the first 3 steps to fail. Failed traders do not apply proper risk management techniques and those that do often micromanage their exits based on interpreting price action in a smaller time frame than their profit target requires. For example, I trade a 5-min chart; if I put on a trade that normally requires 15-20 minutes to reach target based on the volume that time of day, and I start watching tick-by-tick price fluctuations on the DOM, or on a 1-min chart, I may take profits early and give up the full target necessary to provide consistent profitability over time based on my particular edge and minimum R:R. Thank goodness! I was really starting to worry about those rabidly menopausal women who'd driven everyone else away
Since no one has mentioned it, not revenge trading after losing money. Being able to take a loss when the market proves your trade is wrong. Being able to hold winners to your target. And finally having an edge which tells you when to take the trade. For example a high probability setup that you can recognize in real time, and not take sub par setups.
You are right. I did not want to make it overly complicated by going into other methods within the same family (with-trend) or describing other families. I can tell from people's answers if someone knows their trading. I would not be surprised if you were to feel the same way. It would be good if you share some other with-trend methods, such as break outs etc, that you have experience and success with.
If you write, you share, and while sharing you learn/discover and help others learn/discover. Being only a consumer is not necessarily a virtue in writing/knowledge.
Probably I should qualify this first by saying I'm not a day trader. You left out one step: keep doing it it over and over again, which you can do if you have a tight initial stop. What happens to people is that they go through a period of non-trendiness, they get whipsawed a lot, and then they give up on their method, probably just when it about to start working again. It takes patience to trade long trends, and tenacity to keep trading them when you go through a rough patch.
Breakouts are a very "safe" method of entering a trend, as long as you exit immediately if they fail. Breakouts are especially powerful if there's a low volume consolidation at a pullback level in the trend, or a low volume flag formation that drifts in the opposite direction of the trend. These apparent lower highs/higher lows generally occur in the middle of the day and suck in counter-trend traders and traders who missed the larger morning moves and are trying to manufacture something out of nothing. The subsequent breakout on volume later in the day when the big money starts buying/selling again in the direction of the trend gains added momentum as the trapped longs' or shorts' stops get triggered along the way, and can often result in a full measured continuation move and an irrational climax (please no comments, db) as price reaches the levels where "disaster stops" have been placed.