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Eiger

Practical Trading Psychology

By Eiger, in Trading Psychology

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Eiger    10

Eiger
Posted
Dr. Vohs notes that self-control problems occur because people are caught up “in the moment’’ and are distracted from their long-term goals.

 

"Caught up in the moment" is an interesting choice of words. Usually, people become distracted from their goals by thinking about one of two things: the past or the future. In an important way, they are really not in the moment, but in some other time frame.

 

Take a live trade, for example. Someone who sees the current trade set up just like a big winning trade from last week may be re-living the past trade and thinking about another big win. A different live trade may be losing money right from the start and the trader is hoping it will turn around in the next few minutes (future).

 

The mind is not really present. It is not following the market. Instead, the mind is caught up thinking about the past or the future. Either way, the mind is distracted by emotions.

 

So, a useful tip: When you notice your emotions coming into play, take a deep breath or two and remember your goals. It can also be useful to acknowledge your emotion, "I am feeling scared (or elated, hopeful, anxious, etc), but my goals and focus are more important." Recommit to your goals at that moment, refocus on what the market is saying, and take whatever action may be needed.

 

Eiger

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Kiwi    16

Kiwi
Posted

I think you are describing one type of loss of focus Eiger.

 

Dr Vohs is describing a different type. "Dr. Vohs notes that self-control problems occur because people are caught up “in the moment’’ and are distracted from their long-term goals."

 

The simplest example would be someone who had decided to lose weight. They move through the day resisting temptations. And other things happen. Then they happen upon some freshly baked blueberry muffins: caught in the moment, smelling those delicious muffins, they pick one up and bite into it; delicious. Oh, darn, forgot about my goal.

 

Substitute watching the market for the day passing, resisting a few good looking moves that didn't quite meet the rules, then just losing focus on the long term goals ... and ... oh no, it looked great, I entered ... but ... ahhhhggg ... its not according to the rules. Caught in that damned moment!

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