Trader Mindset

Subscribe to the show

...you have to be bullish on yourself, to put it in context. 

When you have zero evidence, and no one to support you, and to endeavor something where most people fail, all you have when you listen to your inner voice, is the unwavering confidence that you have in yourself. 

That you're going to make it no matter what, no matter the obstacle, and not knowing how you're going to do it. 

Just take the action and the resources will show up for you on the way. 

But you have to take the first step. 

Nothing is going to happen if just sit and overthink things and wait for the perfect moment. 

You have to take action.

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

Click here to Subscribe to the Show

If the chart you're looking at runs from the lower left corner to the top right corner, it should be on your watch list. 

Many traders who are chart readers "anchor" their outlook to what they feel they missed, rather than where the underlying is going. 

The top right corner of the chart is a function of how the data is coded to appear on your screen, it's not a fundamental or technical call that the move is over by any means. 

If the trend is up, the underlying should be on your watch list. 

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

Subscribe to the podcast

Volatility can change after you put the trade on. That means you may have slightly too much or too little risk on. 

For one trade, it's probably nothing to worry about as long as you have a protective stop in. 

However, it is significant when you look at it over the hundreds or thousands of potential trades you'll make over your career. 

This is especially true when volatility increases significantly, as we've seen the last 3-4 months. 

Listen to this episode and learn what to do when volatility expands after you've put a trade on.

Get your free copy of The Inner Voice of Trading audiobook

Click here and subscribe to the show

You can add as many qualifiers to your orders to try and control the environment, but they can work against you too. In the case of Limit orders, you might get your price, but not the size you're looking for. 

Listen to this episode to learn the tradeoffs of using Limit orders or not. 

Get your free copy of  The Inner Voice of Trading audiobook. 

For short-term traders, it might make sense to have fast machines, fast screen refresh rates, and maybe low latency to the exchange servers, but for the majority of traders trading from their office or home, it's not about hardware or software. 

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

More important than figuring out entries and exits is knowing how to position size. 

Newer trades should focus on this more than anything else. 

Bruce Kovner was quoted in Market Wizards as saying (I'm paraphrasing) whatever you think your position size is, cut it in half, then do it again.

You might not make as much when your trades take off, but it's more important as a trader and speculator to play superior defense. 

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

Normally, we want to get filled on our Entries at our Stop price because that's where we've determined we'd like to add the risk - either from our mechanized trading system or by reading the chart.

So it might be surprised or frustrated when you get your executions and your fills are above your Stop price. WTF?

Stop orders become Market orders once they're elected, so there might be several orders (sometimes big ones) in front of you.

Those can push the price beyond your own Stop entry price.

In my experience, when that happens, it's a good thing.

This type of slippage doesn't infer a bad execution on the B/D or FCM's part, but because other buyers are interested at the same levels you are.

Listen to this episode and hear why that can be a good thing.

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

It's wise to use a circuit breaker to determine if you put a trade on or not. 

One way to do that is to measure the volatility of the instrument in question. 

Many traders use the 20-Day ATR for that measurement. 

With Gold's volatility at $50, and the contract being 100 troy ounces, you're looking at $5,000 of daily volatility. 

If that's equal to your risk unit of 1/2 of 1%, then you need a $1,000,000 account to trade 1 COMEX Gold contract. 

Listen and see why you might not want to trade this contract using a tighter stop than $50.

Click here to get your free copy of The Inner Voice of Trading audiobook (and other free lessons). 

I like my clients and students to have trading goals. Not just in terms of Rate of Return, but also about the endeavor overall. 

How do you want your trading to serve you? What purpose does it fulfill in your life?

If you have a family, is it to provide for your kids' educations since college degrees are running as much as $300k per student. 

Do you or will you you have to help a parent out in their retirement, besides saving for your own?

I have seen my students performance greatly improve when they set goals around what they want their trading to do for them. 

Even getting a clearer picture yields results in this manner. 

You've heard it a million times, you get what you think about.

Make sure you have a clear vision of what your want because your thoughts become things. 

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

In times like these, it's not too difficult to get stuck into the thinking that the struggle won't end. It will, but it's anyone's guess as to when. 

I like to advocate that that you focus on what you can control: "Control the control-ables," as it's said. 

That's why it's important to have goals - goals that you create around your personal trading or pro trading career. 

As I've mentioned before, knowledge isn't enough. If you set goals and work towards them, you'll grow as a person. 

Measure your activity and progress and when you look back in 3-4 months, you'll be able to see progress.

That can be very motivating during trying times and boost your mental health and energy. 

You can use this to motivate you to do the work today in order to become the vision you have for yourself in the future. 

Thoughts become things. 

Put those things in your consciousness and focus on what you want, not what you don't have. 

Click here to download your free copy of The Inner Voice of Trading audiobook.