Trader Mindset

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Most chart indicators or overlays use the price as an input. 

That makes them a lagging indicator which might be better for confirming trades after you already have them on, not for generating orders. 

And if you're not in the trade already by the time the indicator confirms, it's too late. You can't chase.

I referred to most of the indicators out there as emotional band-aids in my book. 

You can see things more clearly if you de-clutter your charts, let go, and surrender. 

When you do that, an amazing thing happens. 

You learn to stop trying to trade an "accuracy" model and you become comfortable with a model of "expected values."

There is nothing better to answer the question "Is this the right place to get long?" than the price itself. 

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Every trader has two systems running at the same time:  their trading rules and their emotional makeup.

When your system generates a trade and you don't put it on, you have variance between those two systems.

That means incompatibility.

When your system has not generated a trade, but you put one on anyway, you also have variance.

That's another type of incompatibility. 

You can use this as an entry point to your evolution as a trader - both your system and your trading rules. 

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Impatience will never pay you. 

It will provoke you to do the wrong thing at the wrong time.

Having a good trading system or set of rules will cure impatience.

When you have a plan, you're not missing out on anything, because there's nothing to do but follow your rules.

Strong plans over strong feelings.

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Much about trading is uncertain. 

All we have is the expected value of a trade. 

Trying to raise money, build your business, determine your trading style, asset class, and trading system rules...the list goes on.

You learn to get comfortable being uncomfortable. 

You live in a probabilistic world and for trader, it's a way of life. 

It will get easier and you'll get used to it. 

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Some of you may have extensive experience in another industry prior to your trading and investing endeavor/career. 

That can prove to be a trading edge as you have definitive experience that the competition doesn't have. 

While you may be prone to overthink things, you can hone your proprietary knowledge and skills and marry them up with trading tactics.

At that point, you might be the bomb in a certain area of the economy or sector of stocks to trade.

In the end, you can only trust the price, so I'd default to that, but don't underestimate what you bring to the table based upon past work or professional experience. 

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There are a lot of things that need to get done to trade successfully. 

I break them down into rituals, routines, tasks, and goals.

Some of those things can be delegated, some you have to do yourself. 

Some feel good, others are a P.I.T.A. 

Although it's different for everyone, the combination or variation of these add up to profitable trading.

Time blocking certainly helps, but I would not lose focus on your goals. 

Make sure everything adds up to you achieving your goals. 

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When trading becomes a grind, it can be a reflection of what's going on with the overall market, the asset class, or you, the individual.

Sometimes there's a negative overhang in the market that makes buying long hard(er) than normal. 

Sometimes it's the asset class that's causing the duress. 

Stocks are secular and commodities are cyclical, and maybe there's transition that you didn't anticipate.

Sometimes it's your own evolution. 

Admittedly, it's tricky to know when to sit on your hands and when to persist. 

I normally advise focusing on playing superior defense and preserving your cash. 

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You are the sum total of all that you know intellectually and all that you feel emotionally. 

You are the system. 

If you don't like the results you are getting, you either have to change your rules or change you.

Intentions equal results. 

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Commodities have no value per se. There is no valuation basis such as "growth" or "value" in commodity trading. 

Traders learning about commodity trading can get into a great deal of trouble if they try to buy a commodity on a pullback on a "valuation basis."

Saying "I should buy it here because it's pulled back X% and that's a reasonable decrease" will put that trader out of business. 

You can't be "reasonable" with the markets and you can't negotiate your stops. 

The best rules and systems are price-based models that eliminate sub-optimal trades and thereby filter out many of the losers BEFORE a trader would put the trade on. 

How do you lose less? Avoid losing trades in the first place. 

Admittedly, it's a bit of a different mindset at first, but it's possible for traders to trade both asset classes albeit with slightly different rules. 

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It's not about the knowing - it's about the doing. 

If your goals is to be a successful trader, make it a goal and be unrelenting in achieving your goal.

Create a clear vision of yourself succeeding at trading, and take the active steps to go to that vision. 

You don't need any evidence - you don't have any.

You don't even know "how" you'll get there. 

If you don't take the steps, success in trading isn't going to show up because you're a good person. 

Listen to this episode on personal growth and start making the steps you need to hit your goal.

Click here to get your Free copy of The Inner Voice of Trading audiobook.