because of one reason and one reason only--they’re afraid! Not of the market, but of themselves. Their fear comes from not having complete trust in themselves to act in their own best interests.
You fear your inability to do what you need to do, when you need to do it, without hesitation. Being afraid causes us to freeze up and makes us unable to pull the trigger to execute our trades. This causes missed opportunities, which leads us right back to the real problem of not being able to pull the trigger–kind of a vicious circle.
After we miss an opportunity (because we are afraid) we play the scenario in our minds in a very unrealistic way. For example, let’s say we want to get long the market. The opportunity comes up for us to get in the market, but our fear prevents us from pulling the trigger, so we do nothing. Then, the worst possible thing happens (in our minds). The market rallies and we start to count the money we’re missing out on because we didn’t pull the trigger. If the market moves our way 5.00 points, we think that we should have had those 5.00 points. We do this whether it’s realistic or not. This is the failure mechanism hard at work. This kind of thinking is most harmful to our trading. We mentally beat ourselves up for missing the trade, and we feel as if we lost the money we would have made had we gotten in on the trade. Therefore, we get angry at ourselves. We call ourselves stupid. We play the trade repeatedly in our minds, thinking about the things we did wrong. This is just like the visualizing techniques we’ve been talking about, with one crucial difference--we’re visualizing ourselves doing the wrong thing. By continually thinking of ourselves as unable to pull the trigger, we’re
and makes things much worse.
Therefore, we need an exercise to help us pull the trigger when we see a trading opportunity. We need to get past the fear that is causing us to freeze up and not move when we should. And, we definitely want to avoid visualizing or continually thinking about the mistakes we’ve made and the opportunities we’ve missed. We
can’t change the past, only the future.
EXERCISE
1) Get in a relaxed state with the relaxation technique “calm body, calm mind.”
2) In this exercise, we want to visualize ourselves being able to pull the trigger without hesitation when we see an opportunity, or when it’s time to get out of a trade.
3) Enter the theater of your mind and first play back (in detail) times when you’ve pulled the trigger as soon as you’ve seen a trading opportunity. Remember to see the details. See yourself watching the charts and discovering the opportunity. You see the green light go off in your head and you don’t hesitate. You place your order. (Can you feel how the mouse feels in your hand? Notice how you feel sitting in your chair watching the screen.)
4) See the trade going your way. Re-live your feelings when you’ve seen an opportunity and jumped on it. Feel how you felt when you were able to pull the trigger without hesitation.
5) If you haven’t had trades where you were comfortable pulling the trigger, then try this: Remember a time when you did something you were comfortable with, something that’s hard for most people to do. For instance, maybe you’re a good negotiator and you’re not afraid to ask for a lower price when others wouldn’t be confident doing so. Try to visualize that time vividly and feel those confident feelings. Maybe you’re a person who is good at fixing
things and wouldn’t hesitate tackling a big fix-it job. You would obviously feel confident that you could get the job done. Then switch the scene in your mind’s eye back to the trading situation and see yourself pulling the trigger at the right time. It’s OK to make up the situation, as long as you have the confident feeling first and are seeing the pictures in your mind vividly and with detail.
6) See yourself liquidating this trade when you feel the time is right. See the details clearly. Clearly see
yourself getting out of the trade. See yourself hitting the correct keys to liquidate the trade. Feel the confident feelings you get from having a successful trade. Again, it’s important that you do these exercises on a daily basis. They won’t work after just one day. You didn’t become afraid to pull the trigger in just one day, so you can’t expect to turn it around in just one day, either. Also, these exercises work better if you do them at the same time each day. This mental practice will reprogram your self-image. After several weeks of practice, if you feel the confident feelings, your inability to pull the trigger will be a thing of the past.
Important Note:
Attempting to do these exercises right after a losing trade or a bad day will not work. It’s very unlikely you’ll be able to get relaxed enough for the visualization process to work if you’re upset or angry at yourself. I would suggest doing these exercises only when you’re in a relaxed state—not when you’re aggravated or upset. That won’t get you anywhere and will simply turn you off from continuing to do them in the future. The term “time heals all wounds” is very true here. If you give yourself some time to calm down (a day, an hour, whatever), you’ll be in a much better position to relax and get some benefit from these exercises.