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It's A Heart-Mind Game... Are You Ready?

  • #221
  • Edited 9:19am Feb 17, 2012 6:29am | Edited 9:19am
Quoting PurplePrince
I really enjoy reading threads like this, It gives me inspiration to keep on going.
Good to hear that PurplePrince. It can come together for you too. It's just a matter of having the right bits of information and understanding of what's really going on and how best to be prepared so you can win. When you find something that works, it just works. You'll know it.

Hope you can spend some time reading from the beginning as some important concepts were already shared.

Take care and thanks for posting.

FX4
Trade what you see, not what you think or feel. Let the market come to you.
  • #222
  • Edited 10:38am Feb 17, 2012 6:35am | Edited 10:38am
Quoting FX4Newbies
[color=Navy]
A strong belief is not a feeling. Confidence is a feeling and can have an element of believing in it, but expectation is at another level. Belief involves acceptance which changes the whole picture. Will be getting into these subtleties next week...planning a little intro maybe later today or on the weekend in preparation for next week's discussion.

Just going with the flow for now...

Thanks for the post.

FX4
Interesting stuff. Thinking amateurishly about it --


Each subtlety becomes well-defined when empowered. Power is a self-circular thing -- How one is in power decides its hold. Two fairly direct considerations to change this hold:
(in)(ter)dependence
Be independent, and interference with non-independent others creates in them the social emotion jealousy which is satisfied through expression and restored homeostasis of aggression-basing brain chemicals.
Dependence on others who provide some internal homeostatic form's control is an extended selfishness, and may create in the self an overweaning need.
Interdependence rebalances power through fair exchange.
(sub)dominance
- stress chronic dependence that creates free-floating fear and other loss-tending emotions
- reinforcement addiction to repetition of a loss or imbalance that invites conditioned reinforcement through emotion (as logic), reason, belief, which are legitimate leveragings of pattern
- others subdominance to others that do not provide a homeostatic control which then stays imbalanced and invites imbalance in other homeostatic controls

A web page called Goal Setting and the Homeostatic Impulse is a way to tip the scales from an unhealthy balance of power.
  • #223
  • Feb 17, 2012 7:54am Feb 17, 2012 7:54am
Quoting Leonlorenzo
1. Confidence isn't an illusion. It should be an expectation of a certain outcome based on either - or both - experience and reasoning.
Quoting auxesis
To say if the market does "A" and "B", then I can expect it to go to "C" a certain percentage of the time. Isn't confidence it's gambling, playing the odds.
Everything Leonlorenzo wrote is exactly, 100% correct. You actually agree with him, but you don't even realize it.

Honestly, I have trouble reading much of what you write because it just comes across as mystical mumbo jumbo. The Void?? Seriously, The Void?

Quoting auxesis


In the Void, the warrior is able to ascertain the opponent’s movements and intentions, but to enter the Void, one must put away all preconceived ideas and notions of their opponent
You know, this SOUNDS good, but does it really have an application to trading?

You refer to "Trading in the NOW", that we can only trade in the NOW...another little statement that sounds good and gets thrown around a lot, but what exactly does this mean anyway? What do you THINK it means? There is no NOW in trading. There is the past, and there is the future. We look at past behavior, to try to predict future behavior. It really is as simple as that.
  • #224
  • Feb 17, 2012 10:00am Feb 17, 2012 10:00am
Quoting Aldente
Everything Leonlorenzo wrote is exactly, 100% correct. You actually agree with him, but you don't even realize it.

Honestly, I have trouble reading much of what you write because it just comes across as mystical mumbo jumbo. The Void?? Seriously, The Void?



You know, this SOUNDS good, but does it really have an application to trading?

You refer to "Trading in the NOW", that we can only trade in the NOW...another little statement that sounds good and gets thrown around a lot, but what exactly does this mean anyway? What do you THINK it means?...
But past behavior does not guarantee future behavior.

It's not "what" you do it's the way you "view" it.

Many, many, moons ago, I sat in a chat-room and watched a young lady trade a ma cross, it became well known, she was quite successful for a time and it was a big hit, many an ea was written to trade it. After a period of time it was noticed that she didn't take every cross, so a laundry list of rules started to follow to "help" the system.

Her trading demise is another story, and not related to my train of thought, only that she was in actuality, trading in a discretionary fashion regardless of her system. Part of her following problem was trying to systematically define her thought process.

The signal itself wasn't the reason for failure or winning, she had already learned that the signal gave false entries.... it was interpreting if the signal was valid.

There's no one trade setup that works in all market conditions, moreover those patterns and indicator entries are all to often manipulated. So reliance on the setup itself isn't what's going to see you through....... it takes something else.

There again, I'm not knocking any type of technical analysis, just trying push the interpretation a couple of notches higher to see it in a different light in reference to the thread title. How you view your analysis effects your heart and mind game.

regards
  • #225
  • Feb 17, 2012 11:28am Feb 17, 2012 11:28am
Quoting Aldente
There is no NOW in trading. There is the past, and there is the future. We look at past behavior, to try to predict future behavior. It really is as simple as that.
Past behavior does not predict future behavior. We may use things from the past as points of reference for the present, and how the market responds to these points of reference may indeed indicate its intention, but again, that intention is now, in TODAY'S market, with a different set of participants and different circumstances than yesterday or previously. Humans are humans, and bots are bots, so certainly we see similar characteristics of behavior in one market (today) when we compare it with another market (yesterday or last week and so on). But similar behavior between the market this afternoon and this morning, or today and yesterday, does not in any way predict an equivalent outcome.

"Now" will vary, depending on your frame of reference. For some it will be a few seconds, others a few minutes, and others perhaps a few hours. Once we get much beyond that time frame though, "now" is best classified as "past." You are correct that at an infinitely small immeasurable level of time, there is only past and future. But for practical purposes, I define it as I did above.

I suspect we are just doing a bit of fancy wordplay here as we are probably on the same page, but I think it is a very misleading statement to say that we try to predict future behavior based on past behavior, thus my reply.
  • #226
  • Feb 17, 2012 11:36am Feb 17, 2012 11:36am
Quoting JoshDance
We may use things from the past as points of reference for the present, and how the market responds to these points of reference (but it)...does not in any way predict an equivalent outcome. (Edit in parenthesis: mine).

"Now" will vary, depending on your frame of reference. For some it will be a few seconds, others a few minutes, and others perhaps a few hours. Once we get much beyond that time frame though, "now" is best classified as "past."
Well said JoshDance .

Thanks for posting,

FX4
Trade what you see, not what you think or feel. Let the market come to you.
  • #227
  • Feb 17, 2012 11:44am Feb 17, 2012 11:44am
Quoting FX4Newbies
Well said JoshDance .

Thanks for posting,

FX4
Thank you for the thread. I have not come to FF in a long time and am glad to see threads like this.
  • #228
  • Edited 12:20pm Feb 17, 2012 11:55am | Edited 12:20pm
Quoting JoshDance
Thank you for the thread. I have not come to FF in a long time and am glad to see threads like this.
Glad you appreciate it. It is my hope that the discussions will really have an impact on traders, so that thoughts about what the market does and does not "promise" or offer would be modified as necessary. Would like to see more traders make it over into the consistently profitable arena.

Many have worked hard and spent small fortunes trying to learn how to trade. It is time I think for them to go beyond and really get a hold of the heart-mind game, 'cause that's really where the game is played. If a trader had a half-decent system and could win there, the money would begin to show up: my 2 cents.

Thanks again.

FX4
Trade what you see, not what you think or feel. Let the market come to you.
  • #229
  • Feb 17, 2012 12:20pm Feb 17, 2012 12:20pm
Quoting auxesis
just trying push the interpretation a couple of notches higher
I agree with you on this, we should always be striving to push our interpration of the market to a higher level. I would not consider an MA cross to be a very advanced level of interpretation.


Quoting auxesis
But past behavior does not guarantee future behavior.
I never said that past behavior guarantees future behavior, what I am saying is that, unfortunately, the past is all we have, and we just have to make the best of it.
  • #230
  • Feb 17, 2012 12:34pm Feb 17, 2012 12:34pm
Quoting JoshDance

I suspect we are just doing a bit of fancy wordplay here as we are probably on the same page
You're probably right about this. I suspect when he refers to the "now" or "trading in the now" he probably means the "very recent past" as opposed to "the distant past", however you want to define those. In other words, don't rely on something that may have worked a year ago, and expect it to work the same way today, because market conditions change, or something to that effect.


Quoting JoshDance
but I think it is a very misleading statement to say that we try to predict future behavior based on past behavior, thus my reply.
Sorry, but I'm standing by that statement. If not the past, then what else is there?
  • #231
  • Feb 17, 2012 1:07pm Feb 17, 2012 1:07pm
Quoting Aldente
You're probably right about this. I suspect when he refers to the "now" or "trading in the now" he probably means the "very recent past" as opposed to "the distant past", however you want to define those. In other words, don't rely on something that may have worked a year ago, and expect it to work the same way today, because market conditions change, or something to that effect.




Sorry, but I'm standing by that statement. If not the past, then what else is there?
There is present, which you have defined above as "very recent past."
  • #232
  • Feb 17, 2012 11:48pm Feb 17, 2012 11:48pm
Quoting ha-pattern
Interesting stuff. Thinking amateurishly about it --


Each subtlety becomes well-defined when empowered. Power is a self-circular thing -- How one is in power decides its hold. Two fairly direct considerations to change this hold:
(in)(ter)dependence
Be independent, and interference with non-independent others creates in them the social emotion jealousy which is satisfied through expression and restored homeostasis of aggression-basing brain chemicals.
Dependence on others who provide some internal homeostatic form's control...
Will come back to this in a bit.

FX4
Trade what you see, not what you think or feel. Let the market come to you.
  • #233
  • Edited Feb 18, 2012 6:40am Feb 17, 2012 11:49pm | Edited Feb 18, 2012 6:40am
Quoting Aldente
Everything Leonlorenzo wrote is exactly, 100% correct.

There is no NOW in trading. There is the past, and there is the future. We look at past behavior, to try to predict future behavior. It really is as simple as that.
Quoting Leonlorenzo
1. Confidence ...it should be an expectation of a certain outcome...

2. To say that nothing can tell you what the market will do and proceed to say that one should trade from advantageous places is a contradiction...Regardless, the root of a decision to trade is one's expectation that a certain thing will happen: ...We are always trading more than the present - bar arbitrage: we are making a prediction for the future.

Everything Leonlorenzo wrote is exactly, 100% correct....


Maybe so...well almost, even the part about trading decisions being rooted in the expectation that a certain thing will happen: an expectation of what price will do. In essence, he is correct because that is what most traders do: they trade with that mindset. I do not believe that it is the most advantageous (mho) as I have explained in my response to his post. Could be a contributing factor to the high percentage of traders that lose. Remember, the playing field is not even. If the market can see the expectation of most traders (and they can see stops, pending orders etc.), and if the market can move price to achieve its goals (and it can), then most traders are sitting ducks, plain and simple.

There is no NOW in trading. There is the past, and there is the future. We look at past behavior, to try to predict future behavior. It really is as simple as that.

I think any trader would love to know for sure exactly what price will do next, and have price do exactly that: and do it over and over. That would be trader heaven . By the way, not saying you're implying that by any means. Technical Analysis is based upon analyzing past price action: very true. Some traders use TA to try to get some idea about what price might do next. Reasonable, and also very true. Some use it to look for a bias in the market that they can exploit: very rewarding. However, here is the inherent problem with trying to predict.

The moment a prediction is made, the mind begins to look for a possible fulfillment. If a trader is looking for a possible fulfillment, the market is looking to give them one, maybe even two: and they just might be illusions. Couple that prediction-fulfillment scenario with an expectation, and you have an explosive "deer in the headlights" cocktail waiting to happen. Added to that, if a trader is using pending orders and stops, which the dealer can see, in most cases that trader is toast. The few times that the situation I have described actually produces a positive outcome, only serve to keep the pattern of behaviour going in the mind of the trader (a conditioning process), but overall, the trader never wins. The psychology of Random Rewards and Conditioning are at work here...both were discussed much earlier in the thread.

So, if over 90% of traders lose (and I'd venture to say that most traders are reasonably intelligent people), and if that is how they have been trading, I'd suggest they try to do it a little differently. I use TA to identify the "current" market bias: weakness or strength. Once I have done that, my mindset shifts to, "Let's see what the market is doing. What is it after now?"...and I focus on that. I might say to a buddy, "I'm stalking EU right now." If I am reading the market behaviour only, I can begin to "feel the flow" and can begin to understand the "mind of the market", which my TA will confirm anyway. No prediction is necessary. (Prediction is a declaration/"decision" before the occurrence of the action). These declarations/"decisions" have heart-mind side-effects that are usually very dangerous to the trader's perception of their trading environment. Perception was also discussed earlier in the thread.

It is not necessary to try to predict price action in order to make money in the markets. It only sets the trader up to be had (my 3 1/2 cents). When reading market behaviour, I am thinking about what the market is after (the traders' money), and what it can "start" doing from here (the NOW moment) to get it. It's just a different way of seeing and thinking. Try it sometime.

The most advantageous place is not in the chart using TA (though helpful): it's in your mind. Try to understand the nature of your opponent, because they will behave in accordance with that nature. All you're looking for then are the market's footprints on their way to continue doing their thing: and then you're on board, just going along for the ride...all the way to the bank, hopefully.

Hope that brings some clarity to the discussion. And still, there are other ways of trading that use hardly any or no TA at all. It's all a heart-mind thing ; hence the name of the thread: It's A Heart-Mind Game...Are You (Really) Ready? All traders will answer that question every time they click: [Chi-Ching] or [Ouch...again?] will be the answers to choose from. Hope more traders learn to choose the first one, and start winning at the game.

FX4

P.S. And we haven't really gotten into how engaging the emotions can pull those heart-mind strings, and "cause" traders make some obvious trading blunders...even make the very best of the best traders goof. We'll get there soon enough. Traders are always learning, right?
Trade what you see, not what you think or feel. Let the market come to you.
  • #234
  • Edited Feb 19, 2012 4:33am Feb 18, 2012 7:57am | Edited Feb 19, 2012 4:33am
Quoting auxesis
“Go Rin No Sho”, or the “ Book of Five Rings written by Miyamoto Musashi in the mid 1650’s…….. was a self study and biography of probably the greatest swordsman ever. In his later years, he had given up on using actual swords in combat (wasn’t enough challenge or learning experience), instead using sticks and once using a boat oar to defeat his enemies. He was never defeated.

Throughout his book he uncomplicates what he refers to as strategy, traditional techniques, attacks and such, they were boiled down to simple explanations on their use and...
Here is a link for the book mentioned by Auxesis in the quote above for those who may be interested in reading further.

For those interested in venturing even further into deeper waters, here's a trading pool I'd heartily recommend. Might not be for everyone, but at least you will be able to see how other traders have mastered the art of trading. It has been said that the first 200 pages are like magic. Thank you fti for ALL that you have shared, and didn't have to...It was because of the information in that thread, that I was able to profit from a long trade in which price never got above my entry price, and I never placed a short to do it. It's a good thing to be open-minded enough to see if something has any credibility to it.

I guess the concept of "The Void" never really goes away as we progress through life...when you understand what it is; and experience it, you can see it almost everywhere. Universal principles never really die because they are Truth, not just reality.

FX4
Trade what you see, not what you think or feel. Let the market come to you.
  • #235
  • Feb 18, 2012 9:07am Feb 18, 2012 9:07am
Hi Fx4Newbies. I'm new here. Thanks for the thread. I think pitchfork is awsome.
  • #236
  • Edited Feb 19, 2012 5:21am Feb 18, 2012 9:18am | Edited Feb 19, 2012 5:21am
Quoting ccreative
Hi Fx4Newbies. I'm new here. Thanks for the thread. I think pitchfork is awsome.
Glad you stopped by. The Andrews' Pitchfork is an amazing tool if a trader understands how to use it and its related concepts.

Hope you find some nuggets in this thread to help you win at the heart-mind game.

FX4
Trade what you see, not what you think or feel. Let the market come to you.
  • #237
  • Feb 19, 2012 6:16am Feb 19, 2012 6:16am
Quoting ha-pattern
Interesting stuff. Thinking amateurishly about it --


Each subtlety becomes well-defined when empowered. Power is a self-circular thing -- How one is in power decides its hold. Two fairly direct considerations to change this hold:
(in)(ter)dependence
Be independent, and interference with non-independent others creates in them the social emotion jealousy which is satisfied through expression and restored homeostasis of aggression-basing brain chemicals.
Dependence on others who provide some internal homeostatic form's control...
Each subtlety becomes well-defined when empowered.

I would tend to agree.

I think independence (being an independent thinker) is an important factor in successful trading. Interdependence is a win-win if both parties are independent in their own right. What you have shared regarding jealousy and selfishness is very insightful.

- stress chronic dependence that creates free-floating fear and other loss-tending emotions
- reinforcement addiction to repetition of a loss or imbalance that invites conditioned reinforcement through emotion (as logic), reason, belief, which are legitimate leveragings of pattern

I like your definition of "stress"...chronic dependence... Glad you mentioned loss-tending emotions...have some emotional categories coming soon.

Then there's the reinforcement: addiction to repetition of a loss or imbalance...deep, most traders never get to think about these things in that manner.

I hope traders are really paying attention to the subtleties; the heart-mind side-effects that they're really dealing with.

Thanks a million!

FX4
Trade what you see, not what you think or feel. Let the market come to you.
  • #238
  • Edited 10:10am Feb 19, 2012 6:37am | Edited 10:10am
We're preparing to start down the heart-mind road. Thought it would be fun to present a scenario that most traders go through when they are introduced to FX trading. Here we go:

Scene I:

Harry: Hi Joe, haven't seen you for a bit. How are things goin'?

Joe: Can't complain. (Hasn't started trading live yet, but getting there soon)

Harry: Haven't seen you on the roads lately during the morning rush-hour commute. Changed jobs or somethin'?

Joe: Kinda. Took some time off work to learn how to trade currencies.

Harry: Trading currencies? Wow, sounds interesting. Do people really make money doing that stuff? Don't know much about it at all.

Joe: You could make a fortune if you know what you're doing.

Harry: Really!!! Maybe I should look into that. Would love to stay home and make a fortune.

Joe: Got some time later?

Harry: Yeah!!! (bright-eyed)
Joe: Come over about 4pm and I'll show you what I do. The market will be open so you can see how things really work.

Harry: Great!!! I'll be there .


Now what do you think Harry is going to see when he gets there? The same thing you probably saw: a trading platform with some tools on it, and your trader friend getting ready to put on some trades for you to see how easy this works: how you can make your fortune.

Will continue with the 4pm session shortly. Just giving Joe Wonderboy time to set it all up .

FX4
Trade what you see, not what you think or feel. Let the market come to you.
  • #239
  • Edited Feb 20, 2012 12:12am Feb 19, 2012 7:31am | Edited Feb 20, 2012 12:12am
Joe got home and told his wife all about meeting Harry and inviting him over. She gives him the eye because she knows he is going to expect her to be "supportive" and clean up the house and have some refreshments ready. She makes the suggestion that maybe he should wait until he starts trading live before he shows it to other people. Joe assures her that he is going to make sure that Harry knows about the risks involved, so she need not worry. He also asks her nicely to "make herself invisible" after the initial meet and greet.

It's 3:59 pm and the doorbell rings. Joe answers the door.

Joe: Hey Harry, nice to see you again buddy. (giving him a pat on the back)

Harry: Hope I am not too early. (wanted to be there at 2:59 pm instead)

Joe: Not at all, come on in. I'd like you to meet my wife.

Harry: Hello Mrs. Wonderboy.

Mrs. Wonderboy: Nice to meet you Mr.......

Harry: Mr. Scaredy.

Mrs. Wonderboy: Nice to meet you Mr. Scaredy. Please feel free to call me CautiousOne. Would it be okay if I called you Harry?

Harry: Sure, no problem at all.

CautiousOne: Great. Well it was nice meeting you, but I will have to excuse myself as I have some other things to attend to. Hope you enjoy your visit with Joe. (As she leaves, she gives Joe another eye).

Joe: Well Harry, glad you could make it. CautiousOne made some refreshments for us and everything is ready to go in my office. Let's head that way shall we?

Harry: Yup. I'm ready. This sounds like something I've been waiting for...and I know you Joe, you've always been the trailblazer in the bunch. Thanks for having me over.

They make their way to Joe's office/trading room. Next, Joe's presentation begins...
Trade what you see, not what you think or feel. Let the market come to you.
  • #240
  • Edited Feb 20, 2012 1:59am Feb 19, 2012 7:49am | Edited Feb 20, 2012 1:59am
Joe and Harry get to the office/trading room.

Harry: Wow Joe. Very impressive . Two monitors? Are those 22-inch monitors?

Joe: Actually 23.

Harry: Cool. You're looking like Mr. Wall Street already buddy. (laughing)

Joe: Not there yet; I'm just starting out. Have a seat here Harry, and we'll begin.


Harry gets something to drink and sits down.


Joe: Okay Harry, the first thing I gotta tell ya, is that a person can make a lot of money in this business, but, it is VERY risky. There's alot to learn and it's not a get-rich-quick scheme. It takes work...hard work.

Harry: No problem 'cause you know I work hard for every dime.

Joe: Yeah, that's one of the many reasons I think you'll be good at this. You're also not the kinda guy to make snap decisions. You tend to think things through thoroughly before doing anything. You've always liked feeling safe and sure about everything you do.

Harry: Thanks Joe. I firmly believe that is the only way to go. So what's all this stuff on your screens Joe?

Joe: The screen on the right has my trading platform. That's what I use to place the trade. I have two charts up, one showing price movement in 15 minute intervals, the other in 5 minute intervals. I'm what they would call a scalper...for now (with a smile). The one on the left I use for Forex Factory, a great place for news and trading ideas. I also have my email up so I can see when new posts are made to the threads I've subscribed to. You could learn alot there. I'll make sure to give you the link before you go. Want you to have everything to do this right!

Harry: Thanks Joe. So tell me about this platform. What are those lines on there?

Joe: Oh, those are moving averages. They are technical indicators that help a trader "decipher" price action so they can know which way price is going to go next. There are dozens of different ones to choose from, I'm just staying with the basics for now. See the list?

Harry: Really. I see.... Wow! Look at that long green whatever above that line...

Joe: That's called a candlestick. It's one way price is represented on the screen. Just to give you an idea...if you had bought at 1.25467 (at the bottom of that candle) and sold at 1.25943, and traded with a standard lot (I'll explain that later), you could have made $476.00 in about 15 minutes.

Harry: Wow!!! (mouth drops open). Is that real money?

Joe: If you trade with a real account...'cause I'm using my Demo now...yes, it would be real money if you were using a Live account.

Harry: You're kiddin' me. How can I get a Demo?

Joe: Don't worry. I'll give you the hook-up before you go so you'll be ready to practise. (with a high-five)

Joe continues with his presentation and shows Harry Scaredy how to put on a trade. He also introduces him to a little trading system he found on Forex Factory that would start him off. Joe and Harry also arranged their trading times so they could chat back and forth and give each other trade ideas as they go.

Harry leaves after about 2 hours and is grinning from ear to ear. He calls Joe later that night to thank him, and told him that his Demo is ready to go and that he has started to read all the educational material offered by the broker about how to trade.


Hope you can identify with those scenarios somewhere. Next I want to begin the discussion: The Heart-Mind Road. We'll catch up with Joe and Harry later.
Trade what you see, not what you think or feel. Let the market come to you.
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