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Quest for the Psychology behind Trading Effectively...

  • #81
  • Jan 25, 2012 8:22pm Jan 25, 2012 8:22pm
Quoting antgal23
what a video - Mark hits alot of the nails on the head

I liked the fact he emphasised the need for a plan.

Personally, my plan developed the more I demoed. My system isnt very complicated but there are 15 points I consider before entering alot of which concern the set-up and the bigger picture.

My advice to beginners is

chart time ( aim is to watch for patterns at the opens)
make rules and stick to them
be open to adding to your rules
read a self-help book x 10
read steenbarger x 10

Anthony
patterns yes, but also momentum, rhythm, etc. possibly indicating accumulation or distribution. if you can catch the direction right at the open, then it can lead to a very profitable day... but if you get wrong footed on a fake then you need to get out quickly..
  • #82
  • Edited 8:46pm Jan 25, 2012 8:33pm | Edited 8:46pm
Quoting CalistogaKid
I'm sure the experienced traders will immediately get what I'm talking about, since they've been doing this long enough for the information to "soak in".
I don't believe that the subconscious can be accessed reliably enough to perform trades (entry/exit points, SL, TP, etc.). But, I'm convinced that as we spend more time in the market, watch CNBC, read every book, newspaper, website, we can get our hands on, etc. we absorb bits and pieces that we are not consciously aware of. These pieces are assembled by the subconscious into larger patterns...
1. depends on a number of factors, but as a general rule of thumb, probably about two years full time, that equates to about 5000 hours, a lot would say that's probably not long enough, but we're all different...
2. good question, you gotta be objective, but with money on the line, emotion is bound to creep in (even just a bit, it's just human nature). not sure there's an easy answer, but maybe we should try and find one..

hmmm, i can visualise it quite easily, but articulating it in simple terms isn't that easy.

mark douglas puts it well when he talks about the subconscious filtering out information that it perceives as harmful, ie. information that may be telling you the market is moving against you. it's just a defence mechanism that we've evolved with, great for dealing with social situations, but a dangerous obstacle when it comes to effective trading. you need to be consciously aware of it and be on guard against it, checking and double checking to counter act this subconscious filtering... if that makes sense, probably not, lol...
  • #83
  • Feb 6, 2012 7:55pm Feb 6, 2012 7:55pm
Quoting FibbinArchie
mark douglas puts it well when he talks about the subconscious filtering out information that it perceives as harmful, ie. information that may be telling you the market is moving against you. it's just a defence mechanism that we've evolved with, great for dealing with social situations, but a dangerous obstacle when it comes to effective trading.
Actually, I totally get that. I'd say that's a critical insight, and my awareness of it is 90% of the reason for my uncertainty. I'm keenly aware of my own capacity for "selective vision", but I'm still in the process of learning to filter it out from that facts.
On the other hand, it's a great reaffirmation for my decision to stick with the demo account for awhile and not simply blow through another live account. I'm realistic about the concept of "tuition" or "paying my dues", but there's no sense in making the cost higher than it has to be.
"The only way to win the game is not to play." - B. S. Miller
  • #84
  • Mar 20, 2012 2:55pm Mar 20, 2012 2:55pm
bump...
  • #85
  • Apr 7, 2012 8:18am Apr 7, 2012 8:18am
Quoting FibbinArchie
bump...
ditto
  • #86
  • Apr 7, 2012 12:58pm Apr 7, 2012 12:58pm
Great Thread Mr Archie!

I too am fascinated to the 'Why we do it' And the control of the hope fear and greed question.

We must maintain or discipline to our rules of engagement, think in probability's and know that anything can happen in the market, every moment in the market is unique....

Easier said than done , yes, ofcorse..But Knowing one's self and identifying your psychological weaknesses and developing rules that will after time curb these downfalls is a key to staying on the path to success. IMO.

Mark Douglas and Mark Cook is great stuff! Here's a food for thought. The first of six I've wacthed before but , thought I'd share...


Best Regards!

Inserted Video



Quoting FibbinArchie
ditto
  • #87
  • Apr 7, 2012 8:43pm Apr 7, 2012 8:43pm
I don´t want to come off too negative, but (and that goes for any occupation or endeavour) if you feel like there´s a great psychological barrier _right from the start_, that you feel will demolish your results over the long term or prevent you from becoming successful, you should be so honest and ask yourself, if short-term trading is really what you want to do with your life. Imagine someone entering med school but being scared of blood, a boxer who in his first training match remembers that he really hates hitting people (and getting hit) etc. Because a trader´s reward is solely money (and maybe getting a knack off beating the market) as opposed to any other occupation where your reward is money AND the comforting feeling that you did something substantial in relation to the outside world (at least in most cases), it´s easy to get your priorities mixed up. Your psychological barriers might just be a little more deep seated than you can imagine now. They are there for a reason and maybe they are meant to stay for good. Just a thought.
  • #88
  • Apr 18, 2012 8:43pm Apr 18, 2012 8:43pm
Quoting Myo
I don´t want to come off too negative, but (and that goes for any occupation or endeavour) if you feel like there´s a great psychological barrier _right from the start_, that you feel will demolish your results over the long term or prevent you from becoming successful, you should be so honest and ask yourself, if short-term trading is really what you want to do with your life. Imagine someone entering med school but being scared of blood, a boxer who in his first training match remembers that he really hates hitting people (and getting hit) etc....
interesting angle, along the lines of the great nature vs nurture debate.. personally i think that discipline and self control are learned behaviours...
  • #89
  • Apr 18, 2012 8:44pm Apr 18, 2012 8:44pm
Quoting Chillypiper
Great Thread Mr Archie!

I too am fascinated to the 'Why we do it' And the control of the hope fear and greed question.

We must maintain or discipline to our rules of engagement, think in probability's and know that anything can happen in the market, every moment in the market is unique....

Easier said than done , yes, ofcorse..But Knowing one's self and identifying your psychological weaknesses and developing rules that will after time curb these downfalls is a key to staying on the path to success. IMO.

Mark Douglas and Mark Cook is...
'sup chill, thanks for posting bro, and thanks for the video link...
  • #90
  • May 14, 2012 6:02am May 14, 2012 6:02am
I'm not completly sure this fits in here, but as this thread needs a bump anyway...

Reading a certain thread with an ongoing hot debate about fixed s/l vs. recovery-strategy (I really don't want to open this debate somewhere else, seems to be a never ending story...), I came across this post:

http://www.forexfactory.com/showthre...02#post5543402

I agree that every trader needs an environment in which he feels comfortable in order to function properly. So we need to focus on a system which allows us this comfort, rather than focus on systems which somebody else runs profitably or the newest indicators/ea's.
Fail better.
  • #91
  • May 16, 2012 1:27am May 16, 2012 1:27am
Im agree, emotions may affect You traid substantialy. Myself I find good suport keep emotionaly balanced drinking green tea
  • #92
  • Jan 20, 2013 2:43pm Jan 20, 2013 2:43pm
thought i'd bump this old thread...

please feel free to post your thoughts, ideas and experiences...

even if your advice for becoming a consistently profitable trader, is to drink more green tea...
  • #93
  • Jan 20, 2013 3:48pm Jan 20, 2013 3:48pm
Well done for the bump, I've not seen this one before.

How far did it get? I mean I'll go and read it all just now but did you get to the tried and tested technique of stabbing yourself with a fork in the back of the hand everytime you cut a winner too early??
  • #94
  • Jan 20, 2013 4:16pm Jan 20, 2013 4:16pm
Quoting The Fool
So get over yourself and learn to lose like a man.
Deeply interesting. Although a bit of a throwaway comment (I suspect) it's interesting because of what it means in our society to 'act like a man'. What does that entail? On the surface it's 'being tough' and 'mature' and I guess saying 'fuck it' or 'fuck you' inside alot. Would that be accurate? Well the common thread through all of that behaviour is emotion - as in lack of. Yes to be a man today is to stiffle your emotion. We all have it, emotion inside of us, but men are taught to deny their emotions at a young age. And throughout life blokes together reinforce this denial of emotion constantly and try to live up to the notion of 'being manly'.

So that's the dark side of being a man. But how does it help us trade? If we traded like proper men we would be trading emotion free. Yes, unlike in real life, that would actually help us because it's the raging emotions that cause us to make the mistakes in our trading day.

In a way, our problems of the emotional roller coasters that inform our trading decisions proves that the concept of 'being manly' is an illusion and based on the denial of what we all are - highly emotional animals. Man the fuck up.
  • #95
  • Jan 20, 2013 5:34pm Jan 20, 2013 5:34pm
Assuming there are no confounding variables (health, family, environment etc), there are 2 core factors, as I see it, causing psychological torment in trading.

[1] the trader does not have a strategy with an edge
[2] the trader lacks a steady mind when trading

If the trader has a strategy that when the rules are followed, is consistently profitable, he/she will find this can oftentimes offset problematic psychological habits.

If the trader has a strategy that is consistently profitable when they follow the rules, yet they find themself unable to follow the rules, then the trader needs to learn how to steady the mind.

For more than 2 decades I’ve explored all the methods. The best by far, in my view and experience, is one that trains the person to turn away from thoughts as they arise moment to moment. In so doing, the mind learns to be very very quiet. Because it loses its addiction to thought.

I posted this a while back. This is a great example of what I am talking about. The reason this fellow is able to do what he does is not only because he is an outstanding athlete, but because his mind does not, or at least rarely, gives rise to thought, except those related to “technical” ones.



Quoting FibbinArchie
The main focus of this discussion will be the psychology behind trading effectively, ie. cutting losers and riding winners, not the other way around. We hear it a million times (usually alongside "the trend is your friend"), fine ok, we know what we have to do, but how do we do it exactly? I challenge you to find an easy answer to this question, anywhere...
  • #96
  • Jan 20, 2013 5:55pm Jan 20, 2013 5:55pm
That's truely enlightening Peter. You are talking of mindfulness and the cessation of fear. This man climbs I would guess not for profit but for the joy of it. That's probably what trading would be if we took his actions as our inspiration. Excellent post!
  • #97
  • Jan 21, 2013 6:09pm Jan 21, 2013 6:09pm
Quoting stevexyg
Well done for the bump, I've not seen this one before.

How far did it get? I mean I'll go and read it all just now but did you get to the tried and tested technique of stabbing yourself with a fork in the back of the hand everytime you cut a winner too early??
to be honest i see this thread a bit like Frankenstein's monster... i'm just trying to reanimate this old dead carcass so it takes on a life of it's own...


it's alive, it's alive!!!!
  • #98
  • Jan 21, 2013 6:12pm Jan 21, 2013 6:12pm
Quoting PeterE
Assuming there are no confounding variables (health, family, environment etc), there are 2 core factors, as I see it, causing psychological torment in trading.

[1] the trader does not have a strategy with an edge
[2] the trader lacks a steady mind when trading

If the trader has a strategy that when the rules are followed, is consistently profitable, he/she will find this can oftentimes offset problematic psychological habits.

If the trader has a strategy that is consistently profitable when they follow the rules, yet they find...
very cool stuff...
  • #99
  • Mar 22, 2013 3:02am Mar 22, 2013 3:02am
...
  • #100
  • Mar 22, 2013 3:38am Mar 22, 2013 3:38am
  •  Jamz
  • | Joined May 2012 | Status: Tops and bottoms are for bikinis | 798 Posts
Thanks for that Fibbin, psychology, what a word to do with forex, just when you think you're right you're wrong etc, over and over so just relax, lie back.......tell me all about it......
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