Anxious, frustrated and afraid, but thanks to all my teachers, never reluctant. Yes, I have to say that all of these feelings were surfacing whenever I was looking for a trade, waiting for a trade or was in the middle of a trade. But thanks to all my teachers, and not just the "pros" but many of my trader friends, I never felt reluctant. I feel that this is because I didn't make all the possible mistakes. So many times others have told me, "been there, done that..." Mistakes like exiting the trade too early, taking a trade because you just saw something, and entering the trade too soon were happening to me often. But, I never traded without the stop or with the thought to move my stop and wait for the market to move my way. By moving back to SIM account I finally realized all of my mistakes, because somehow I was totally not seeing them by trading live.
"The key to longevity is making those mistakes early in your development, before you have too much on the line."*
Perhaps if I had found all of those mistakes sooner, I could have shortened my path of learning just a bit. All my mistakes came down to one biggest problem I realized during SIM trading - Overtrading. I was leaving the trade that I didn't allow to hit my target, so I was trading brake outs, and it ended up to be a loser. Or I was taking a trade without good planning, without even checking my rules and setup, and repeating this over and over again. Each loss I kept trying to make back and trying again and again, with only more frustration and anger.
"In order for a market event to generate a negative emotional response, we have to view it as a threat."*
I am a day trader and my style might be different than yours, my dear reader. But by remembering my rules and plan I do save my time in trading and my money as well. What do I mean by that? Rules that govern when I can take a trade are the key information for me even at the moment when I’m looking for a trade. There are many times that the market is doing nothing and thanks to those days I can save my time and do many other things instead sitting and watching with no opportunity to trade. In the past I would click my mouse like crazy and end up with a big lose, now I accept days that I can use my time to save my money. Being a day trader set me up with a very limited type of trading based on my rules, and if there is no setup there is no trade. The best I thing I can do is to wait for a setup, and check it with my rules. Then, and only then, do I take the trade. With clear rules there is no way to view the market as a threat.
“Every time you experience a distinctly negative emotional reaction to a market event, consciously ask yourself, ‘How am I perceiving the current market as a threat?’”*
Reading the market during the day can lead to many thoughts. When it’s trading without me, I’m thinking I lost an opportunity. But on the other hand, since I don’t take this as a threat or dwell on it emotionally, I don’t care where the price is. I care only about seeing my setup and my way of participating in the market. Whatever the market is doing I’m doing my job. Being alert in front of the computer puts me into the zone of planning and drawing. As soon as I see a good opportunity I trade; as soon as I realize the market is not for my rules today I walk away from the screen. This way of thinking and planning puts me in a calm and relaxed mood for the day.
"When you think about your thinking by adopting the perspective of a self-observer, you no longer buy into negative thought patterns."*
There are many ways to read the market. I look for trades based on three types of technical measurements. If there is nothing to see I simply wait. Otherwise I become nervous about why there is nothing to trade. If there is a moment that the price is approaching my setup I simply wait for the price to give me a stop placement and an entry place. If this doesn't happen first then there is no trade for me. There are tons of moments during the seven hours of waiting for the trade that a trader can read the market as a threat, lose money or get nervous. During this time, while measuring and possibly trading I write a journal about anything that is happening and it helps me to either wait or act appropriately.
"Identify the perceived threat; turn the perceived threat into an opportunity: that is a two-step process that addresses the true cause of emotional reactions that distort trading decisions."*
"The key to longevity is making those mistakes early in your development, before you have too much on the line."*
Perhaps if I had found all of those mistakes sooner, I could have shortened my path of learning just a bit. All my mistakes came down to one biggest problem I realized during SIM trading - Overtrading. I was leaving the trade that I didn't allow to hit my target, so I was trading brake outs, and it ended up to be a loser. Or I was taking a trade without good planning, without even checking my rules and setup, and repeating this over and over again. Each loss I kept trying to make back and trying again and again, with only more frustration and anger.
"In order for a market event to generate a negative emotional response, we have to view it as a threat."*
I am a day trader and my style might be different than yours, my dear reader. But by remembering my rules and plan I do save my time in trading and my money as well. What do I mean by that? Rules that govern when I can take a trade are the key information for me even at the moment when I’m looking for a trade. There are many times that the market is doing nothing and thanks to those days I can save my time and do many other things instead sitting and watching with no opportunity to trade. In the past I would click my mouse like crazy and end up with a big lose, now I accept days that I can use my time to save my money. Being a day trader set me up with a very limited type of trading based on my rules, and if there is no setup there is no trade. The best I thing I can do is to wait for a setup, and check it with my rules. Then, and only then, do I take the trade. With clear rules there is no way to view the market as a threat.
“Every time you experience a distinctly negative emotional reaction to a market event, consciously ask yourself, ‘How am I perceiving the current market as a threat?’”*
Reading the market during the day can lead to many thoughts. When it’s trading without me, I’m thinking I lost an opportunity. But on the other hand, since I don’t take this as a threat or dwell on it emotionally, I don’t care where the price is. I care only about seeing my setup and my way of participating in the market. Whatever the market is doing I’m doing my job. Being alert in front of the computer puts me into the zone of planning and drawing. As soon as I see a good opportunity I trade; as soon as I realize the market is not for my rules today I walk away from the screen. This way of thinking and planning puts me in a calm and relaxed mood for the day.
"When you think about your thinking by adopting the perspective of a self-observer, you no longer buy into negative thought patterns."*
There are many ways to read the market. I look for trades based on three types of technical measurements. If there is nothing to see I simply wait. Otherwise I become nervous about why there is nothing to trade. If there is a moment that the price is approaching my setup I simply wait for the price to give me a stop placement and an entry place. If this doesn't happen first then there is no trade for me. There are tons of moments during the seven hours of waiting for the trade that a trader can read the market as a threat, lose money or get nervous. During this time, while measuring and possibly trading I write a journal about anything that is happening and it helps me to either wait or act appropriately.
"Identify the perceived threat; turn the perceived threat into an opportunity: that is a two-step process that addresses the true cause of emotional reactions that distort trading decisions."*
*LESSON 13 The Daily Trading Coach 101 Lessons for Becoming Your Own Trading Psychologist by Steenbarger, Brett N.
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