Trading in Canada 

Hi there I'm still struggling with my psychology. I'm not sure if before I was totally honest with myself when I asked this. I recently came across an article for a second time and for some reason it suddenly made sense to me. It was an article by Steve Ira Present MS. He said, "positive thinking will destroy your trading career". I read this again and I realized I do this. It's naturally how I approach life. I set goals for myself and I charge along focused on completing my goals. I'm stubborn so I will keep trying until I can check off my goal. But something he said made me suddenly realize this is a big reason as to why I'm sabotaging my results. In fact I believe it is at the epicenter and perhaps the biggest fundamental reason as to why I am unable to achieve the results I'm hoping for. After all when you start your trading day positively thinking, "I'm going to make xyz today." Or your previous day you smashed it so the next day you envision another monumentus day.. or at least one that is positive. For myself, how this manifests is I don't have a problem taking a loss, I have a problem having a losing day. I step away when I've had a loss but when I come back I still have this "fantasy" positive image in my mind, that today will be a winning day. So really I guess I really haven't shaken off the loss. When I then have another loss, I say to myself I'm not reading this right so I give myself a moment or I will trade a different product. Now if I have a loss with that product, that's it, gloves are off and I'm revenge trading. Part of my issue as well.. I watch my results. So in conclusion, I think, if I stopped having positive thoughts, fantasies or affirmations that all is good and "I'm going to crush this today" but instead replace that attitude with something else I could handle a losing day and walk away, etc. Now to be clear this mindset was something I think I learned as a child. It is something I've adopted to help me to cope with/survive the environment I grew up in. I've always had an uphill battle in life and this attitude is what has allowed me to overcome struggles and persevere and survive. But now I think that this "can do" attitude may be actually hindering my trading. So can I ask, has anyone else struggled with this and what do you replace those overly positive visions/goals with when you start your trading day?

Thanks for posting. Yes, I have struggled with this for years. Its a never ending mental battle.

You want to have the best mental attitude for trading and be a successful trader. You want to be positive in general and be happy in your overall life. So, what is the solution?

I'll tell you what has worked for me. In the name of discretionary trading, I was conflating lack of an edge with psychology. Psychology is important, but it cannot substitute for lack of an edge. No amount of psychological improvement can change a math equation.
I was fooling myself for years that I have edge. Once, I realized this, I started to spend my time in finding provable edges. It is not easy. Markets are dynamic and edges are constantly fleeting. But, that is the nature of the game.

So, focus on finding provable advantages in markets first. Then, work on your psychology. Things will then fall into place.

Wish you the best.

There's a delicate balance and fine line between being absolutely confident in your abilities and being so confident that it turns to stubbornness. Yes, you must be 100% confident, but be confident in your ability to be resilient when you lose, your ability to wait, your ability to pull the trigger with resolution, your ability to walk away when you're underperforming, and your ability to make money in the long run.

You have NO control over how much money you make in a trade. You only control one thing in trading, and that's the magnitude of your losses. You have absolute control over that (not accounting for black swan events which are out of your control). Nothing else. Really think about that, and it should make you never even think "I'm going to make xyz today" again.

That's great advice. Focusing on controlling my losses makes a lot of sense

ThemBones 

A plastic band isn't a serious enough response to breaking rules; you'll likely condition yourself to accept the snap. You need a response so abhorrent you wouldn't dare break a rule such as taking a sledgehammer to your vehicle 50x or donating $1000 to a vile (legal) organization. Remember, do not be hard on yourself. Mistakes are OK - as Mark Douglas says - they are experiences which point the way. You are endeavoring to master one of the most difficult professions of them all. There are many people who can't even dream to be a trader. You are ahead in the game of life in this respect. From the first 'Equalizer' movie: - "Progress; not perfection."

Haha.. I think you're right. Maybe a shock collar turned on 100.

ZviTradingCoach 

First of all I would like to commend you on both the openness to share your story, and the self-awareness that allowed you to notice this problem. I agree with much of what wrote to you. I would like to add a few more points: 1. What do YOU want instead of the current pattern? This is indeed the key question, but it is one FOR YOU to answer. When working with traders on changing subconscious thought patterns (and from your description - this issue runs deep in your subconscious patterns), this step - the creation of an alternative thought pattern - is a key step. However, it is done through a process in which the trader himself takes the lead in coming up with the solution (yes, with guidance on how to approach it, but ultimately it's got to be his call and his wording). Any "external inspiration" can often do more damage than good. Why? because the "best" trading mindset is VERY unique to each person, not a "one-size-fits-all" phrase from a trading psychology book. If the solution isn't built in synch with the rest of the trader's mindset - it'll just end up creating a new internal conflict and new self sabotaging patterns. After all, you don't want to replace one thought pattern that was good for someone else in your childhood, you've adapted it, didn't fit your mindset and your now need to unlearn - with a new thought pattern that's good for someone on the forum, sounds good to you - but might causes new issues and you'll need to unlearn it too.... Take the time and self-work to really figure out what it is you would like to be thinking at these situations - either alone or with proper external guidance. It's well worth it. 2. made a very important remark about the link between how you act in trading and in other areas in life. This is true and crucial to identify for any fix to work. We do not have two minds or two personalities - one for trading and one for everyday use. We are the same person. Any issue we have in trading is often present in other areas as well. This, by the way, is one of the reasons that improving trading psychology is so difficult: in order to "fix" something in your trading personality (in your case, sticking to rules or being less "positive-oriented") - you need to "change your regular personality". And that is something most people want to avoid... which is why so few people actually set out to do it - and so few actually succeed in trading. 3. While the decision to pause trading is valid, "watching and documenting the market" is not likely the key step right now for your progress. The key is to do actual work (alone or guided) on your mindset, not on the market! The tricky part in trading psychology is that Unless you take ACTION to actually change your mindset, it will not change - and once you resume trading you'll likely go back to your old deep-rooted habits. I also agree that this issue of positive thinking - while definitely important - is not the only thing that's blocking your success. Rule-following also came up during the conversation as a major issue, and a few more are showing signs (although I wouldn't presume to guess specifics off a forum post). The good news: you're already one step ahead of the crowd by actually acknowledging such issues and making an effort to work on them. And once you do, the ripple effects to everyday life will be not only an "added bonus" to your trading progress, but a blessing on their own merit. Good fortune in your trading!

Thank you so much for your comments. You are right regarding what Thembones said which was insightful. I guess I never really thought about it before.

The family motto was always: "rules were made to be broken". I grew up thinking that way but I soon learned that attitude is exhausting to maintain and I actually do try my best to follow rules BUT there is a little voice that pops up and says... "except when bending the rule doesn't hurt anyone".

The fact is dismissing my rules or bending my rules is causing me a lot of harm and preventing me from achieving my trading goals.

I have a lot of personal work to do and thank you for great suggestions and insights.

Sometimes you can't always be as objective with yourself.

patrader65 

Thanks for posting. Yes, I have struggled with this for years. Its a never ending mental battle. You want to have the best mental attitude for trading and be a successful trader. You want to be positive in general and be happy in your overall life. So, what is the solution? I'll tell you what has worked for me. In the name of discretionary trading, I was conflating lack of an edge with psychology. Psychology is important, but it cannot substitute for lack of an edge. No amount of psychological improvement can change a math equation. I was fooling myself for years that I have edge. Once, I realized this, I started to spend my time in finding provable edges. It is not easy. Markets are dynamic and edges are constantly fleeting. But, that is the nature of the game. So, focus on finding provable advantages in markets first. Then, work on your psychology. Things will then fall into place. Wish you the best.

Did you find a definable edge?
How do you define it? I don't need to know your edge I just curious as to how one defines an edge?

I use my equity curve. But I feel a huge part of my success is having the discipline to follow my plan.

ThemBones 

There are a lot of markers in in your writing signaling a need for professional coaching such as hoping, sabotage, stubbornness, childhood trauma, being right, and more. With that said, you started the thread title asking about positive thoughts but by the end you've switched to overly positive. I wonder if the problem actually stems from unrealistic thoughts. As far as revenge trading, outside of psychological investigation, you need to create a mechanical system to compensate. However, if you can't follow your trading rules (which as far as I can tell either you have no rules or you can't follow them), you should stop trading right now. I didn't say give up; simply stop trading. You may have already stopped, and I tip my cap to you if you already took this step. It is a sign of integrity. Instead, create some rules to follow in your personal life. Most people cannot follow rules in their own life; how can they expect to follow rules when trading? It's unrealistic. Once you make progress there, you can start to create a realistic plan to follow for trading.

Thembones - You are dead on with this evaluation of needing more assistance, and coaching. I also loved your solutions to help. ALL GREAT!

deaddog 

Did you find a definable edge? How do you define it? I don't need to know your edge I just curious as to how one defines an edge? I use my equity curve. But I feel a huge part of my success is having the discipline to follow my plan.

**************************************************
Challenge:First, try after a losing trade, to NOT take the next one until you've a figured out the modification needs to be, and test it. It could be a new rule (I call these items that affect your cash) or a distinction (nice things to know that make the set-up better). Then go to the next trade in SIM.
Most can't STOP and continue to trade and lose. BUT this is an exercise in Discipline.
Solution: Journaling ALL these Rules and Distinctions during the day is a 2nd recommendation. REREAD The daily list before each trading day. As the mind will not retain information unless repeated 7x in the memory.
So, just doing these few things will IMPROVE your trading DRASTICALLY!!! not just a little. Doing this also helps to hone in on your "edge."
PLUS this will give your mind a break from emotions in the process.
Good Trading!

ThemBones 

A plastic band isn't a serious enough response to breaking rules; you'll likely condition yourself to accept the snap. You need a response so abhorrent you wouldn't dare break a rule such as taking a sledgehammer to your vehicle 50x or donating $1000 to a vile (legal) organization. Remember, do not be hard on yourself. Mistakes are OK - as Mark Douglas says - they are experiences which point the way. You are endeavoring to master one of the most difficult professions of them all. There are many people who can't even dream to be a trader. You are ahead in the game of life in this respect. From the first 'Equalizer' movie: - "Progress; not perfection."

Mark was a dear friend of mine and is missed. I Love the quote Progress not Perfection, says it all. Good Trading!

deaddog 

Did you find a definable edge? How do you define it? I don't need to know your edge I just curious as to how one defines an edge? I use my equity curve. But I feel a huge part of my success is having the discipline to follow my plan.

Basically, an edge is a clearly defined (without ambiguity) and repeatable idea/trade that generates a positive expectancy over a period of time (within the confines of drawdown parameters). It is based on past data as nobody can predict the future.

I have attached an example of what an edge return might look like (this is one Option trade per day).