Visualisation techniques for a trader

DSM

Well-Known Member
#1
Visualisation Techniques

One of the best ways to increase profits is to do goal setting and visualizations in order to align the conscious and subconscious with making profits – Ed Seykota, (Featured in Market Wizard Series and who is reported to make 250,000% profits over 16 years for one of the accounts he managed)

Athletes, Entertainers, and elite traders use affirmations and visualization techniques for boosting performance and increasing success. There is scientific evidence that has documented the usefulness of affirmation and visualization techniques in improving performance.

Visualization is using our brain to create images of who we want to be, or act in real life or in live trading situations. With mental repetitions of the images, we reinforces the neural networks in our brain to create new pathways enabling us to make quick decisions in all situations and get a mastery over our trading.

From Trader Feed :

When visual imagery is paired with a highly focused and relaxed state, it begins to look like a self-hypnosis routine. What you're really accomplishing with the imagery is a kind of self-suggestion: you are preparing yourself to act in a desired way in a targeted situation. Indeed, by staying very focused and calm during actual trading, you can activate the scenarios that you've practiced. Such "anchoring" is an unusually flexible and powerful psychological technique: by linking a desired behavior to a distinctive mind state, you invoke the behavior whenever you enter that state.
Notice that the goal of the exercise is to turn a positive trading behavior into a regular, automatic practice. Too often traders focus on reducing or eliminating problems, when in fact they would be better off by building on their best trading practices and making those more consistent. That is the essence of the solution-focused approach, and it's a great application of imagery.

Coping With Stressful Events - By visualizing events that have, in the past, elicited the fight or fight response and simultaneously using constructive coping methods, traders can train themselves to cope with those stressors. An example would be to walk oneself through a trade that is stopped out and, during the visualization, rehearse the kind of self-talk that would be constructive in such a situation. So you would imagine the market going against you, getting out at your chosen spot, and then directing your thoughts to learning from the market action, rather than getting frustrated over the stop out.

Reinforcing Best Practices - Here is where you use visualization to anticipate what you plan to do during the trading day, walk yourself through various what-if scenarios, and prepare yourself to respond in a planned manner. The idea here is that the visualization is both a preparation for market action and a preparation to respond to opportunities created by that action. If you have encountered a situation in your mind many times and prepared yourself to act, you're more likely to be ready to take the proper actions when that situation manifests itself in real time.

Note: Unfortunately, many of us tap into the power of visualization, but in reverse. When we become caught up in negative thoughts and images, we are actually using visualization techniques, but in a way that reinforces ideas that undercut our confidence. Just as we want to replace negative self-talk with more constructive alternatives, replacing destructive imagery with constructive visualizations programs us to handle difficult situations well and recruit our best trading practices.
 

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