Trading ... Trader ... AND I ...

Thanks... Awesome post.

And that reminds me, today I shape what is my future will be tomorrow, a month, a year and 10 years from now. In short, what I do today is what will shape my destiny, my life.

Trading Frustration and avoiding it ...

Want to stop staring at your charts for hours on end? One technique I have used is a “Stagnation Filter.”
For example, if I am watching and waiting for a signal on a 15 minute chart, and price is moving sideways with no candles exceeding 15 pips for over 90 minutes, or price has not exceeded an overall range of 30 pips, I will walk away from that trading session and come back for the next session.

I prefer to trade with the trend or a specific counter trend set up, so if the market is consolidating or channeling, I do not sit staring, especially if there is very little volatility or movement within the consolidation channel. I will miss many breakout trades, but I am willing to forego them for the benefit of my sanity and the risk of turning into a trading Zombie. You will soon learn that nothing can be gained from endlessly staring and you will eventually become impatient and behave irrationally as boredom and anxiousness set in. Walk away.

Another tool I use is audible alerts. I will perform my pre-trade session analysis, note possible set-ups, and then simply wait for the audible alert. I then run through my trade progression to determine if I have a valid trade signal.

I maintain my trading mind set by reviewing my notes and Top Down Analysis, but I do not mindlessly stare at my charts. I am ready, but not clinching or focused on every tick or candle. Relaxed intensity.
My trigger is the audible alert which tells me to pay attention to my charts and then . . . what do I see, what does it mean, and what do I do?

There is a big difference between “Do I see an opportunity to trade?” and “Do I have a qualified signal to trade?”

Take a look at your trade plan and see if you can break away from the numbness created by over-concentrating and try implementing a stagnation filter. Looking back will help you determine what ranges and which trading times work best for you. Be prepared to walk away acknowledging you will miss some trades.

Knowing when not to trade is equally important to your trading psychology as knowing when to trade.
What’s important is that the trades you do take meet your rules and your mindset is calm and disciplined. We never want to let our impatience dictate our behavior.

Learn to recognize your emotions when this situation occurs and walk away – never feel forced or obligated to place a trade without a valid signal.

You’ll save time, money and frustration.

AAA Thumb Rules that I always follow ...

"Acknowledge (a visible set up) ... Analyze (Qualify the Visible Set Up) ... and ACT (Trade) IMMEDIATELY"

We often say in trading that you must learn to control your emotions. We know that uncontrolled emotions will cause inconsistent, if not disastrous trading behaviors.

The fact is, controlling our emotions is the single most difficult thing to master as a trader.

Surprisingly, there is one thing we can control that will lead us to emotional indifference.

Risk.

The only thing we can decide before entering the market is how much we are willing to lose to prove our edge.
When we accept risk, we can become emotionally detached from the trade and can comfortably walk away.
Accepting the risk means we are prepared for all of the possible outcomes – either we are wrong and get stopped out, or the trade reaches our profit targets.
Knowing and accepting the risk means we are accepting either outcome with the same expectancy our trading plan has statistically provided.
We expect losses and wins according to our plan, so we are not surprised or overly emotionally invested in one outcome over the other.

Successful traders know that it is impossible to be consistently profitable without assuming risk. They also recognize this is the only decision they can control.
Because each trade is only one is a series of thousands we will take, overall it’s outcome has no greater significance than the next trade or the one before it.

If you find yourself too emotional when in you have an open position in the market, you have not accepted the risk of the position.

Draw downs and losses are a part of trading. If you are frequently overreacting to them, stop trading and take some time to adjust your trading plan. Thorough back testing will provide the draw downs you can expect to encounter and help eliminate the emotion. Knowing what to expect will take away the anxiety and pain avoidance.

Also remember, you should never enter the market without defining your risk and reward. In our case that means placing a stop loss and profit targets.

Prepare yourself by understanding your trading plan inside and out. Thorough back testing will reveal what you can expect. You can then decide, adjust and control your acceptable level of risk before ever entering the market. You should not focus on whether or not the trade was a winner, but whether or not you stuck to the rules of your plan. This is the key to success.

Mastering emotion means mastering risk. It is the only thing we can control and should control before we ever enter the market.

"We can not control The Market. We can control our emotions to be with the Market"

Thanks GG,

The same philosophy in different words : I define what I want to risk, and let the market define what it wants to rewards.

How much pain ... or the Lack of it?

This is the question you must ask yourself before you ultimately decide to be truthful about your trading commitment.
How much pain are you willing to endure before you actually develop, test and then execute a trade plan and set of rules?
How much pain will you suffer before performing the practice necessary to act without hesitation when you get a valid trade signal?
How much pain in financial losses is enough for you to realize trading is a serious business and must be treated as such?
These are not new questions by any means.

In fact, they are the questions evident everyday in chat rooms, forums and blogs.
What is your breaking point?

The problem is that pain avoidance is what normally drives our decision making. And if pain is what we are trying to avoid, we will focus on the negative to justify our fear and negative perceptions.
This creates a negative internal dialogue that leads to a self-fulfilling negative action, reaction or result. In other words, if you have a negative internal dialogue, there is a high probability your results will also be negative.

You will literally talk yourself into repeating bad behaviors that in turn reinforce negative habits resulting in losses and a vicious cycle.

If by some chance you break your rules and the trade works out, or if you get paid for breaking your rules, you are reinforcing bad habits that will later sabotage your success.

If you suffer a trading loss for which you are unprepared, you will lose focus on other opportunities that can far outweigh the magnitude of the loss.

The trading author Jack Schwager in his “Market Wizards” books comes to one important conclusion; the most critical characteristic of a trader is how he/she handles a losing trade.
If you haven’t yet come to this conclusion, let me help you – how you handle trading losses will determine whether or not you can make it as a trader. Game over, MATCH LOST

Mastering this element of trading psychology is the most critical component of successful trading.

The question you should be asking yourself and must answer honestly and sincerely, “What am I doing everyday to achieve the consistency and profitability to be a successful trader?” Really think about that question. How are you spending your time? Are you being realistic? Are you expending the effort?

If we believe the statistics, 90-95% of traders are not asking, nor are they answering by their actions, the questions above. The problem for most is that they must inflict and/or suffer so much pain before they change their behaviors and belief systems.

The silver lining is that trading is a skill can be taught and learned. This had been repeatedly proven and documented.

But, nothing can happen until you decide to make the changes in your own mind and your own life to get real and get working.
The only question you must ask yourself is “When am I going to get focused do what it takes?”

The answer is ... ALWAYS ALL WAYS ... NOW!

Anyone can handle profits
The essence of a succesful trader is always how to handle losses and himself.
:clap::clap::clap:

One of the best thread in tj forum:clapping: :clapping::clapping:

Thanks for the highest compliment ...
But, somehow, I'm not sure of your signature ...
More apt will be ...

"Hamesha, Jeet ne keliye, kuch karna hi padta hai aur aise jeetne wale ko .. TRADER kehte hai" :thumb::clap::clapping:

HOLY GRAIL, THE PERFECT STRATEGY ...

We spend a lot of time trying to find and implement the “Perfect” trading strategy – one that gives us crystal clear signals, minimizes our draw downs and produces 100% winners. Naturally we want the most gain with the least pain. That’s why we jump from system to system. We have not yet accepted the reality that no perfect strategy or system exists. We are afraid to be wrong. We want perfection without risk. We spend a lot of time being angry at the market when we should be angry at ourselves.

If you are a systems trader, you can follow you rules to the absolute and still having a losing trade. That is our challenge. You will often hear of systems advertised that produce 80-90% winning trades. This assumes you are a machine that takes every signal, at all times of day, and follows the system rules without deviation. Really? Even the most disciplined of us can not reach these levels of perfection.

I am often criticized for taking trades that meet my criteria for a valid signal only to have a loss – especially if another trader copies my entry and targets and also incurs a loss. My system is quickly dismissed and/or condemned. I can not defend the fact that there are losses in trading and my system was designed for my level of expertise, so I fully accept the outcome of each trade. I will never apologize to all of the haters that expect to jump on the coattails of others and do not expect any losses.

It is your responsibility to develop and/or revise a system that will apply to your uniqueness. Furthermore and most importantly, it is also your responsibility to thoroughly test a system to confirm its performance and not take the word of any marketer or another trader.

The truth is that systems with a 50% winning rate (or less) and proper money management can produce staggering profits. The perfect system exists only in that it is a system that fits your personality and you can follow the rules consistently. That is as close to perfection as we can ever expect to achieve.

Regardless, we will continue to search, expecting someone else to solve the riddle we can only solve for ourselves; to develop a trading system or strategy that fits our individual criteria for our personality and our level of ability to execute it.
You will find certain things about certain systems appealing – whether it is the “look” of the system on a chart, the indicators, or the rules. That is all well and good. But, you must have realistic expectations, confirmed by the data you have obtained through back testing, before you can ever execute any system with any level of consistency.

The search for a system can be arduous, but searching without testing is futile. Until you accept losses and perform back testing, you will suffer the endless cycle of system jumping – confused, frustrated and lost. Pros and marketers are counting on it.

Make sure your search for perfection includes the process of back testing, a thorough understanding of the system rules, and adjustments for your level of experience and current trading state.

You will find that losses become nothing more than a very minor and acceptable inconvenience – not worth any anger, frustration or significant emotional investment.

"Trading is not JUST about numbers ... It is about the PROCESS behind the numbers"