With the advent of the World Wide Web a new super highway of information is continually at our fingertips. More info than has ever been available previously. We can easily overload ourselves with info such that there are not enough hours in the day to absorb it let alone take action on it.
This has also become a breeding ground for guru`s whose message is buy my product.
Then the answer to your dream or problem will be answered. When this fails to work what do we do?
We, well I have been guilty of this in the past, go immediately back to the start. Which of course is looking for the info.
Let me explain this phenomena,
Adding more information to your life will not change it.
There is an ongoing untruth which the masses have brought into that the next lot of information you purchase will contain the answer.
The truth is that “ACTION IS POWER”.
Sitting at the desktop, I have a warming array of books within arm`s reach. The subjects trading, affiliate marketing, and self-development are my interests. Now of those books most I have read and have applied perhaps 5% average. So that 5% having been applied are no longer simply information on the bookcase shelf but an important part of my everyday life. No longer needing to think of the info or refer to the book as it is now ingrained within.
Of the remaining books, if I recall their contents at all, they come off the shelf to be re-read to refresh the mind of their contents.
You must apply the following to realize benefit from them.
The results will come from doing not from knowing.
The more willing you are to do the action part the more likely you are to see an increase in you results ( trading account).
So again, What is the number 1 thing you need to know to improve your trading results?
” ITS KNOWING HOW TO CONTROL YOUR EMOTIONAL STATE“.
If you don`t know who you are. The market is an expensive place to find out.
Investor`s whose actions are dominated by their emotions are most likely to get into trouble.
Point of interest: Try thinking of charts as simply a reflection of the emotional state of those buyer`s and seller`s in the market.
Yea, everyone want`s to tell you must control your emotional state. However no one tell`s or shows you how to control emotions. We all have them, it is what makes us human.
It is possible to control someone else`s state but will cover that in a future article.
OK let`s get to how we can begin to control our emotional state during trading. The state you are in is everything. Most traders concentrate on support, resistance and the favorite ‘the trend is my friend’.
This comes second to what you are about to read.
Let`s say our goal for the next year is to increase our income from trading by 50%. Quite manageable.
In trading this will be determined by the consistent results you produce throughout the year.
The consistent results will be based on your consistent behavior.
What determines the quality of your consistent behaviors?
The quality of your decisions.
And what controls the decisions you make?
The emotional state you are in.
You cannot make good decisions when you are feeling badly, you generally make bad decisions.
Your state will determine how much you end up with in you account.
What you have to do to make a difference to your account is to control the emotional state of your mind.
One way to control our emotional state is
By using internal representations (images) to your mind.
The pictures we run in our mind control our emotional state. Let`s look at how this works. By imagining things by visualizations notice the quality of visualization as the more you practice the clearer your visualizations become.
In your mind`s eye imagine your favorite place to visit. The beach, park, shopping center and then point to where that picture is. Left, right or rear of brain then grade it on how much you love visiting the place.
1 being least and 10 being irresistible. Record difference when we change the quality of the pictures.
How many pictures are there, is it in back and white or is it color, bright of dark. Is it far away or close?
Notice as many differences and details as possible. This will get easier.
Try pushing the image away so it is smaller, then back and white it and make it dimmer.
Then score your favorite place 1-10 and importantly notice how you feel.
Next, bring it up close in color, bright and associate with it. Notice all the details you can.
Use a pen and paper to begin with.
Again note your feelings for it and rank it 1-10
If you did this correctly you must have notice a huge difference in how you felt when picture was far away then up close.
When the picture is far away it can easily be left there with no desire for it.
When the picture is up close it seems irresistible like you need it now.
Get the picture (pardon the pun)
Moving the picture about, using fading and coloring is resetting your feelings toward your favorite place.
Note your feeling with picture in various modes.
So for something to have less impact on you emotionally see them as far away, dim and in black and white.
If you really want something bring it up close in you mind`s eye.
Now think of something that motivates you. Tennis or cars perhaps. Now are you in the picture or are you watching a visualization of you.
You could be associated which means you are in the picture or
disassociated meaning your watching yourself in the picture.
Then watching what you are motivated by step into the picture (associated). Notice how this feels.
Then step out of picture so you can see yourself in it. Again notice the new feeling. Is there a bigger impact emotionally.
When we are associated into a situation there is a bigger emotional impact on us.
If situation is having a big emotional impact on you and you don`t want this then step out of it. ( step out of the trance).
Things we are associated into have a bigger emotional impact.
When we disassociate this impact is reduced.
If something is influencing or having to much of an impact on you then step out of the situation in your mind`s eye. Think of something that was said to you during the day, that upset you. Notice as many details in your imagination as you can. Where is it in your mind, is it in black and white or dim.Grade it 1-10 10 being most irritating.
Then if you are associated you will see yourself in the picture. Simply disassociate by stepping out of it.
Then you will see yourself in the situation but you wont be in it.
Now there was a point in time before this started we will call point A.
Then after the comment was made we will call this point B.
See a visualization of both point A & B
We are going to start at point B and rewind the whole scene to point A.
Then just like an eraser wipe it out. You must do this step to get the full impact of dissociating your feelings from a situation.
If you have been going over this from point A to point B in you mind chatter, this process will halt this immediately. You are unlikely to recall it in the future as you removed the connection to it.
The more times you play this situation backwards (B-A) in your mind the more it will decrease the effect it has on you.
A useful example follows in the video by Paul Mckenna.
The point of this process in your trading.
When you make a mistake in your trading, do not berate yourself. Simply step out of the situation and disassociate from it. This will stop it effecting your trading in the future as we link feelings to situations.
Now think of a trading error and yes play it backwards to reverse the emotional attachment to it.
This will stop this error affecting or influencing future trades.
Warning–If you do not reverse the situation you will see it repeated in your trading.
Exercise for reversing trading errors.
List trading errors from your journal and use this reverse technique to change your emotional state in reference to it.
Your decisions are based on your emotional state.
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