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bottom), you missed the entire move up. At this point how do you feel? Are you glad that you had the discipline not to enter a market that failed to make a valid double bottom using your rules? If you are upset, what are you more upset withthe market's failure to make a double bottom or your failure to go long? |
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Proceeding along these lines, let us say that after putting the pain of losing your money behind you, you begin waiting for another possible second bottom. Soon a double bottom comes along in a different market, and following your discipline you go long using the same rules as before. Once again the strategy fails and you lose money. What are you thinking now? Let me ask you a question: How many times do you honestly think that you will repeatedly obey your discipline before abandoning it? The answer for most traders is three or four times. After the fourth loss, they will begin tinkering with their rules and lose the original discipline they had. |
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Invariably what happens is that after they abandon the discipline they initially had, a trade comes along that works just like they thought it would. How do you think you will feel if, after losing four times in a possible double-bottom trade, you decide to pass on the fifth trade, and it works so well that you would have recovered all your previous four losses and even made a nice profit? All too typically the feeling that most traders get is intense anger, and resentment toward the market and their own shortcomings. |
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Trading is the most difficult profession you could possibly decide to enter. It is also the most intellectually satisfying. It appears very easywhat could be easier than going long on a double bottom and going short on a head-and-shoulders violation? After all, to be a great success all you have to do is go out and buy a computer program that will identify possible chart patterns, and do what it tells you to doright? |
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As in any sport, the real game is played out in the space between your ears. Mastery of trading demands that you take charge of your internal representations, values, and beliefs. Discipline is one of the cornerstones of mastery. Without discipline you will be switching trading programs, methodologies, and newsletters faster than Superman can change into his cape! |
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How do you become a highly disciplined trader? The answer is similar to mastering your ego, creating faith, and gaining confidence. You must acknowledge how crucial discipline is for your ultimate success. Once you acknowledge its importance, you need to be firmly in charge of your ego, have unshakable faith that the outcome you desire will be accomplished, and the confidence that your methodology will work. Then you start the process of changing or creating the necessary beliefs that will empower you to become a highly disciplined trader. |
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