In total, I went to the beach on over 25 occasions over the past 4 days! There is no doubt whatsoever that this extra analysis of my emotions is already reaping rewards. Once I'd done it a couple of times, I noticed that I became quicker to spot that first point where frustration begins and managed to nip it in the bud before it reared its ugly head. Together with the talking technique, I can already see improvements in my emotional state. I am still making errors and it's been a disappointing week but the difference to previous disappointing weeks is that I am not losing money anymore. I have been able to pinpoint the psychological issues that are causing me to stagnate in my progress. Three major problems came to light:
1. I am still sometimes reverting to my old strategy and trying to guess who is going to win, rather than trading the market
2. I often try to trade too many games at once
3. I am placing emphasis on monetary targets
Number 1 and 2 should be easier to stop. They arise purely out of trying too hard to force a win - it's impatience. Number 3, I didn't even realise was such a big issue.
I have often stated on this blog that I don't set any monetary goals. I think any profit-related goals are a hinderance, particularly daily ones. That said, in the back of my mind, I do want to attain a certain amount of money each day and have always been affected psychologically by how big or how small my profit was when my head hit the pillow each night.
I think I have always believed that I could make a certain amount of money and would be able to get close to that amount every day, as long as I traded correctly. I now realise that this is complete foolishness. It only puts pressure on you before you've even started and that pressure and stress is only going to increase every time you have a losing trade.
Why do we put such pressure on ourselves to reach goals each day? A day is just a period of time based on the patterns of the sun. Why should it matter how well we do in a particular 24 hour period? If we have a good day followed by a bad day, it doesn't mean we are becoming a worse trader. It just means that we made more money in the first 24 hours than in the second 24 hours. In the big scheme of things, it means nothing because it only matters what we do in the long-run. Yet so many traders can't see past what they have done since they woke up and then went back to sleep. Have I made back what I lost the previous day? Have I hit my daily target? How much will I need to make tomorrow to recoup the shortfall from today? I feel great because I had a profitable trading day! I feel like shit because I had a losing trading day. None of that should matter!
It's only a short, insignificant period of time and therefore it shouldn't be labelled as good or bad, especially as it is going to affect how you approach the next day. Looking closely at my emotions has made me realise that I expend far too much energy worrying about hitting targets, feeling good when I switch off the PC and what mood I'm going to be in when I wake up next morning. I should be viewing time as one continuous period, rather than compartmentalised chunks of hours.
Each day will bring different opportunities and different ups and downs which we can't control. If you can accept the ups and downs then it genuinely won't matter what happens in any given 24 hours as long as at the end of the month or quarter or year, you are able to pay the bills. I've gotta tell you, it's a real relief to finally accept this. It's very tough mentally, to not think in terms of day to day but I know that from now on, it will help me relax much more.