Trading In The Zone

Just been having a files sort, in the slow European Bank Holiday morning, came accross the above Mark Douglas files.

Mark Douglas's work is a must read, IMHO.

Thanks for the links and files.. Already got them in my stock...
I also agree with you with M. Douglas' stuff... I find them priceless.

I'm just quite having an issue with what he teaches or wrote and what Van Tharp teaches because some of their works seem to overlap each other... I also don't know who taught about the nature of beliefs in trading first whether V. Tharp or M. Douglas..

But I think M. Douglas is the one that originally wrote about the nature of beliefs in trading... I may be wrong though so if anybody has any knowledge, please do correct me..

Regards,
East

Does not matter who was first ! Or that their works overlap, it's all good stuff, IMHO.

The beliefs stuff is a big issue. As Guru Douglas says 'Watch everything you think, say and do'. That statement helps me. He also discussed the fact that should a belief rise up, which interfears with your trading, you can acknolwedge it, though do not act on it. Remember that a belief might also reveal itself in something you do, rather than something you just think.

I think in was Daniel Gramza who suggested timing sabotaging feelings with a stop watch and that soon helps take away their significance,

Here is a great Douglas quote, to remember after a series of losers:

"How can a losing trade or even a series of losing trades have the typical negative effect ~ if you really believe that trading is a probability or numbers game?

If your edge puts the odds in your favor, then every loss puts you that much closer to a win. When you truly believe this, your response to a losing trade will no longer take on a negative emotional quality."

I just think that we also have to consider here the gambler's fallacy or bias (?). Just another thought anyway.

What is that ?

I think it's similar with the quote you posted. I'm not sure if they're the same.
Here's a thread started by Iso about biases that affect one's trading:
http://www.forexfactory.com/forexfor...ead.php?t=4859

But for a short description of it, got this from the above thread:
Gambler’s fallacy bias. People assume that the probability goes up for a win after a losing streak or up for a loss after a winning streak.

Regards,
East

Skills to be mastered to Make consistent results (taken from Mark Douglas' June 2005 audio file)

1) Market Knowledge/Reading the market - this is the study about the market's behavior to look for an edge. An edge is simply a probability of one event (i.e., going up) happening over another (i.e., going down).

2) Think in Probabilities - random distribution of winners/losers; a mind-set to let your edge pan out; the outcome needs the participation of another trader. Sometimes they're there, sometimes they're not. For you to become a winner, another must be willing to buy at a higher price than where you bought.

3) Ability to recognize and neutralize any self-sabotaging belief - recognize any self-sabotaging belief that prevents us from giving ourselves unlimited wealth. Then neutralize these beliefs so that they do not cause severe drawdowns.

4) Recognize we have crossed the threshold into euphoria - so that we can operate in a neutral/objective environment to still perceive risk. Once you recognize that you're in a state of euphoria, you have to have the discipline to step aside until that state of euphoria dissipates.

Here's a "bump" to give this thread more exposure . . .