Do you think trading is simply about finding a good technical “setup,” then you’ll have a virtual cash machine for the rest of your life?
Trading is mostly psychological.
Well, successful trading is.
You’ve probably heard that before. But most traders don’t believe it.
More accurately: Most amateur traders don’t believe it. The professional traders ALL believe it!
I was born in Detroit and raised on the suburbs just a couple miles from the city limit. Lived in the same 2-bedroom house my entire childhood.
Both of my parents were born and raised in Detroit.
So I grew up as a fan of the Detroit sports teams.
I’m not much of a baseball fan, but I sure do love football.
Over the last few years, the Detroit Lions have broken many records … unfortunately they’ve been records of formerly “worst” football teams! The Lions became an embarrassment.
I moved to California about 16 years ago, but I’m still a Detroit boy at heart. And I still get more excited about the Detroit teams than I do for the California teams (however, don’t get me started on the fact that L.A. doesn’t have a team in the NFL).
2 years I subscribed to a satellite service that broadcast nearly every NFL game of the season. This allowed me to start watching the Lions again. Very exciting … until the season started.
They lost game after game after game after …
And it wasn’t just that they lost games. They played terribly!
And guess what?
The more I watched the Lions lose, the more I lost money at trading!
As I said, I love football. REALLY love it! So I got very involved with the game, the players, the coaches. I got very emotionally involved in every game.
When they lost, I felt like a loser.
“MY” team lost.
And so I’d start my trading week on Monday feeling like a loser.
Take it from me – NEVER TRADE WHEN YOU FEEL THAT WAY!
It took me a few weeks until I connected trading with football. My wife actually pointed it out to me (wives are great for that sort of thing).
She never watched the games (as much as I love football, she hates it). But every Sunday afternoon she’d come out of hiding and notice my mood and say “Lions lost again today?” And sadly that mood would carry over into Monday and Tuesday.
Yep, pretty ridiculous, I know.
I never stopped my affection for the Lions. I didn’t want to be a “fair-weather fan.” But the truth was that I cared too much, it actually affected my self-image, and so my inner-trader had to yell at me to “Step away from the football!”
Trading requires confidence and a positive attitude. It’s a performance and you must feel like a winner because that attitude will carry over into your trading behavior.
Perhaps for you it’s not football.
But examine your life for what makes you feel like a winner or a loser. Cut those things out of your life that affect your attitude negatively and add more of those things that make you feel like a winner.
So how did I solve the problem?
GO RED WINGS!
Postscript: I do have to add an extremely well-deserved: “Way to Go!” to the Lions this year as they’ve made an amazing turn-around. I’m proud of them and am watching their games again. Keep up the good job guys!