Every trader who analyzes a chart is playing first-level thinking: what does this pattern suggest price will do? Every trader who asks, “what will other traders do when they see this chart?” is playing second-level. The game is won at the third level, anticipating what others expect others to expect. Most people don’t even know it exists.

Winning requires understanding what other participants believe, what constraints they operate under, and what they’ll do next. Understanding the metagame. Your analysis of the underlying asset matters only to the extent that it differs from and exceeds the analysis of the person on the other side of your trade.