Taking breaks.

I was home alone with my laptop on the dining room table; alone, with no help, no understanding, continuing to make the same, old mistakes. It is very hard to be a trader by yourself. Working hard every day on my notes and charts was giving me nothing. I was not seeing any good come out of the work I was doing. The learning process is long, they said – no kidding. No one but another trader could understand that I kept hearing the same things so many times, but nobody was able to help me. My work and I were chasing each other around in circles, never changing.

"The greatest enemy of change is routine."*

"In familiar environments and routines, we operate on autopilot. Nothing changes."*

Even though there was no big change happening to me and my trading day to day, I realized that being alone was not going to help. One day during an online class I met a person who suggested I join a big group of traders. This was a big step forward for me. I was very interested in how others see the process. I could talk to traders in real time during the day about what I saw and what they saw. We shared views on the markets, but that was not all. Online lessons became clearer, and I started to understand more and more of the technical side of the trading scene. This was all because I now had other traders to share with and talk about markets.


This wider view, the lessons and reviews with many traders, were steps for me to know more about trading rules, plans, and strategies. But, it was still hard and painful. I started building a set of simple rules for myself to trade better. It was far away from the stage where I am now, but one lesson was crucial - breaks. I know I’m straying from today’s topic, but I want to get this out there as soon as possible now that I’ve thought of it. The best decision I ever made in trading was to take breaks. Since I started this habit, I've become more relaxed and more prepared for the next day. My breaks are small ones during the day, or big ones after a bad day.  I also choose to take a whole day off on days when the markets are not so good for trading, and of course just for time with my family or friends. It doesn't do any good to tie yourself to your computer on a forced schedule because you end up making mistakes. One of the best breaks that I ever took was my decision to go back from live to SIM trading in December 2012. It was a break from losing and from stressful trading. It allowed me to move on and work on myself as a trader, instead of focusing on the money.


"When you act as your own trading coach, your challenge is to stay fully conscious, alert to risk and opportunity."*


But, I digress. After a long time, a very long time, I started to get the feeling that change was about to occur. The change was with how I see the market. It’s not about the technical picture, but about me being able to control myself, my actions and reactions, based on my rules. I finally saw that I would be able to achieve success because I started to plan with strategy and risk management. I realized that rules and patience were the keys for me to get this right.  If only I had some of this insight from the beginning, I would have saved myself lots of stress and tears.  That’s why I hope I can help you all to start your own plan sooner rather than later. 


"In short, it’s the mental routines—the mental environment—that we most need to change to break unwanted and unprofitable patterns of thought and behavior."*

*LESSON 4 The Daily Trading Coach 101 Lessons for Becoming Your Own Trading Psychologist by Steenbarger, Brett N.

Mistakes.

My friend Teresa has always told me, “Learn from your mistakes, learn from your losing trades.” She still says this any time I or somebody else shares about a bad trade. And in response to her I always asked myself, “How the hell can I learn from my red trades? What the hell she is talking about?” But, I never asked her for more of an explanation, never. And I never learned from my mistakes until I found how to do that in this book. It became so easy to understand, to read and look for mistakes after I read lesson #3, amazing. Who knew?

"Consider embracing your flaws: every losing trade is there to teach you something."*

Ever since I embraced the idea that I should work on my losing trades it got so easy and simple to go back and look for my mistakes. Sometimes I found very big mistakes that I was a ashamed of, but other times I saw that I missed something and I learned. I found some little mistakes that I kept repeating with every losing trade, and this discovery led me to correct some of those small mistakes.  This made a huge difference for me. By checking these moments, I also learned to make a better check list for future setups. Every single trade since then has been checked to see if I missed something, or if I was pushed to do something that I shouldn’t have done. From that moment I realized what Teresa meant by learning from your mistakes, what she was trying to teach me.  I guess it’s better late than never, right?

"Either way, your losing trade is never a total loss as long as you embrace it and learn from it."*

At this point my journal started to have a lot more information in it. Not only about each trade I plan to make, but also information about what I see before and during this trade, and of course just after it is done. If this trade was a losing trade then I was looking for an answer to the question WHY, to explain why it was a loser. If it was a winning trade then I was looking for good things I did, to make them visible to myself and to be able to repeat them the next day, and then over and over again afterwards.

"...the research of James Pennebaker suggests that giving voice to stressful events—in a journal or out loud—for at least a half hour a day is instrumental in our putting those events into perspective and moving beyond them."*

*LESSON 3 The Daily Trading Coach 101 Lessons for Becoming Your Own Trading Psychologist by Steenbarger, Brett N.

You and Your trading coach.

As I said before, I started my change before I ever got to this book. It would have been easier if I had begun the process while simultaneously coaching myself, but it is OK for you to start coaching whenever rather than never.  Don’t wait for “the right moment.” At the time, I was only focusing on my trading and it was just harder to do than it is now that I've learned how to be my coach.  As soon as I started to talk to my coach it became a lot easier. By talking to my coach, I mean nothing else but keeping a good journal. This doesn't mean that I had no journal before; I did have one, but it somehow had less meaning for me. Once I started to keep specific notes about my trading plan, myself and trades (at the moment of, during and after a trade), it all began to mean a lot more to me. Putting it all on paper is one step and the second is reading it at the end of the day or the week.

"Research informs us that the most important ingredient in psychological change is the quality of the relationship between the helper and the person receiving help."*

With having a new journal entry for every single day, for every single setup and trade, I started to see what I was doing and how I was doing it. The thing is that, before I started keeping my new journal, I had no idea why I was anxious, nervous, happy or even excited. It was hard for me to write a journal during the trading day. I had been doing it after the day was done, after good or bad trades were done, and by that time I didn't remember my filings, my setups from the very beginning to the very end of the trade, and I wasn't even sure what I did right and what I did wrong. I was missing much of the information between the lines about my trades and myself.

"Many traders don’t really know what they do best; they’re invisible to themselves."*

So what was different in the new type of journal? I could say everything, but to be more specific it was because of four things. These were the time when I wrote in my journal, the way I organized the journal, commenting on it at the end of the day and finally, reading it at the end of the week. With having correct information at the correct time I was able to see what I was really doing throughout the trading day. I was able to see my mistakes, but also, and most importantly, I was able to see what I was doing well. I was getting information about things to avoid and also about things to repeat and do over and over again. My first goal and most important thing to do, and repeat every single day was to write in a journal. Once I had this goal accomplished I was immediately looking for the next little goal to add to the next day and the next week, and I repeated this process all over again and again, until it was my habit.

"Set a positive goal, based on strengths, to keep you in touch with the best within you."*

"Trading goals should reflect trading strengths."*

While working hard on achieving my goals I realized that I was doing great just by having control of myself and my action in relation to market action. I saw that I was making huge progress in making decisions as well in having more profitable trades. I was not paying attention to the trade itself, but rather, I was paying attention to myself, my action, my decision processes, my feelings and goals that were set for the day/week.

"The best relationship is achieved when goals are linked to values and express distinctive strengths."*

"...if you’re not keeping a journal, your coach is silent. What sort of relationship is that?"*

*LESSON 2 The Daily Trading Coach 101 Lessons for Becoming Your Own Trading Psychologist by Steenbarger, Brett N.

Change.

In December 2012 I decided to stop trading. Why? Because I lost so much money that I could not allow my account to drain any more. I decided to move back to simulated account (SIM) until I get it right. I told myself it will take as long as it needs to take. I felt I needed to change, and at that moment, I was not even reading this book. If I had been, then everything would have been easier and quicker. Once I started it, it seemed like my experiences were always one day ahead of whatever section I read. I was reading things that already happened to me just one day earlier. Whenever I sat down to read, it was as if the chapter was written just for me.

"Many traders only get to the point of self-coaching after they have experienced harrowing losses."*

I wanted the change without even realizing that I was doing just that – making the change. The thing is, it’s very hard to start changing. It was hard for me. The decision to move back to SIM terrified me. I have to admit that I cried and it really hurt to be going backwards with my work.

How many times have you tried going on a diet? How many times did you start workouts for yourself to get into better shape or to feel better? How many times did you try to quit smoking or drinking? Me, I quit smoking many times, started workout programs as well, and diets too. I always had a good reason to go back to my old, bad habits. But finally, I reached the goals I wanted to achieve in those areas, but it took time and effort. It’s the same with trading.

"The easy part is initiating a change process. The real challenge is sustaining change."*

With my decision to go back to SIM, I realized that I needed to change and finally get it right before I would ever go back to live trading. I knew it was going to take time, time that I didn't have. When I thought back to how many times I had already gone back and forth from live to SIM trading, it scared me that this time would be the same with the same results. But I pushed myself, to stay on SIM and to work hard to make a change once and for all. The key is in the plan, rules and strategy all at once, to be followed every single day in the same way.

After 4 months of trading on SIM I finally got to the point that I saw I can really do it. I had fewer rules, but a more specific set of rules with the same plan and the same strategy. My pain and fear of trading changed to the driving force behind making me trade the same way live, because I did good based on those rules on SIM account. It was very important for me to do the same thing on the live account, so I set a goal for myself. My goal for 2012 would be to break even doing the same thing live that I had done on SIM.

"The secret to goal setting is providing your goals with emotional force."*

It is the end of the year, and I am very proud to say that I reached my goal; I broke even. Also, I have finished my first reading of Steenbarger’s book, which gave me a lot more than just information about what I was going through. With my own help, I got a new set of goals. And now I know I can reach them.

"It’s important not just to have goals, but also to directly experience yourself as capable of reaching those goals."*

Today I coach myself to continue my change. Every day I check on my work to see and feel my success. Reaching each and every single goal, and following my rules every single day is pushing me to do the same over and over again. I don't ever want to look back and think about the days before December 2012.

"Coaching is about making change happen, not just letting it happen."*

*LESSON 1 The Daily Trading Coach 101 Lessons for Becoming Your Own Trading Psychologist by Steenbarger, Brett N.