Remember when you first ventured into trading?
You experienced a range of feelings - excitement optimism and an eagerness to learn. Right?
Those feelings propelled you to roll up your sleeves, knuckle down and get started. Agree?
They shape your intrinsic motivation driving your high engagement and commitment to persevere through challenges.
Yet just like a lush garden filled with vibrant colours and blooming vitality, your inner motivation needs nourishment.
Without the right attention it wilts and fades. What once thrived becomes stagnant, choked by the absence of sustenance to nourish it. Correct?
What happens next?
Losing faith in a successful trading future is paralysing. You end up giving up despite never planning to. What lingers is a sense of anguish stemming from abandoning your aspirations. Sound familiar?
Reviving your passion by reinvigorating your motivation
Two separate aspects of trading - unrelated to monitoring P&L - are within your control. (Whew!)
• Idea thinking
• Idea execution
Wait a moment: If you associate this with chart patterns indicators and signals, you're already missing the point.
Being well-known they produce nothing more than a merry-go-round of inconsistency. Right?
Instead often referred to as 'game planning' - idea thinking requires deep consideration to uncover opportunities most people overlook - which is how they give you an edge.
An Illustrative example - feel free to use this one
Ever Missed a Market Move?
But what happens when that missed opportunity is a major one?
How do you feel?
Experiencing disappointment in missing a large move many people strive to capitalise on a reversal. The underlying principle lies in people trading to regulate their emotional state.
In the chart below you can see the sharp move to the upside.
Near the highs are several 'levels' traders can hang their hat on to get short.
Now at this point - it's not all that important how robust those reasons to get short are because people are looking for any excuse to get short. But from our perspective it's good to know about them.
Enter a long trade and benefit when short traders are crushed in a short-covering rally.
Before delving deeper
This is an idea. And while not revolutionary it's nonetheless not an idea you'll see covered in common trading 'how-to' material. Agree?
Here's the crux
Uncommon ideas aren't crowded with competition. Ideas that are obvious to most people frequently fail because the market follows a different rhythm than the crowd.
The speed at which you click buy and sell buttons or interpret charts holds little significance if this aspect of your trading venture hasn't reached competence.
On the flip side - if it's been missing in the past - now you know what to focus on specifically. And if you're looking for help in this area - you're not alone. More on this in a minute.
But imagine you've got into the rhythm of developing unique ideas that mostly play out. It's a fun part of trading if you relish the challenge of solving puzzles. And the more you do it - the better you get. That's motivating. Right
How about executing your ideas? Continuing with the same example
When you execute on an idea you don't know:
• If your idea will come to fruition.
• When your idea will work.
And between now and then price can move around a lot.
How often have you heard someone say "I knew it would do that?" Yet in the lead-up, they entered into a trade - took a tonne of heat - possibly even a massive loss (or two) - and only then does the market 'do that'.
Maybe you've experienced this yourself. And to rub salt into your wounds you're on the sidelines NOT participating in the move if and when it finally happens. Right?
Trading like every business entails expenses. One cost is commissions. You always look for a fair deal on commissions right?
Another cost is the false starts on ideas working. You choose low-cost commissions. In the same way you can choose the low cost of putting on 'risk' to see if an idea will work or work right now.
It's your choice if it costs you an arm and a leg (massive losses) or a low-cost paper cut. Make sense?
In the image below you can see 3 things:
- The cost of the idea not working is cheap.
- The payout (due to adding) is much larger than that cost.
- So even if the idea only worked after several false starts - overall you're a winner.
How to reduce the cost of false starts
Businesses invest in reducing their costs. Correct?
In the image below you can see the investment in tools (all chart windows monitor a single market) to restrict false starts to paper cuts.
What you don't see
- Like sports surgery and carpentry - trading takes reps to achieve competency.
- And like every profession there's external study and a path of ongoing assessment.
Is this surprising?
As a trader at a professional firm - you don't have a window displaying your profit and loss.
Because when buying and selling you have one job. Execute your ideas within a low-cost framework. Ideas that elude the crowd. Ideas you've thought through before you click the buy or sell button.
These are pivotal elements under your control. And you get better by engaging in them daily and weekly.
Seeing your improvements is how you brush off making mistakes because the positives outweigh the negatives.
And then a funny thing happens - upon self-reflection you see the strides you've taken. And lo and behold - your account performance has turned the corner.
First the bleeding stopped. And now you see you're on a positive trajectory.
Forex and derivatives trading is a highly competitive and often extremely fast-paced environment. It only rewards individuals who attain the required level of skill and expertise to compete. Past performance is not indicative of future results. There is a substantial risk of loss to unskilled and inexperienced players. The high degree of leverage can work against you as well as for you. Before deciding to trade any such leveraged products you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading on margin, and seek advice from an independent