Imperfection Happens

The best thing about my trading today was that I realized early that — for the most part — I didn’t understand how the market was behaving, and so — for the most part — I didn’t execute trades.

As a price action and structure-based  trader, I need to have a very clear read on what the market context is as well as what it’s doing right now.  When I can’t make sense of those two things in the context of one another, I have very little edge.  As much as what I want is to hear the market speak clearly to me, sometimes I just can’t hear it, and at those times, it’s critical not to trade.  That’s all well and good in hindsight, but how does one deal with that in real time?  I mean I AM HERE TO TRADE, RIGHT?!  I need to make my daily goal!  I need to prove to myself I am a great market reader and trader!

These are exactly the thoughts and feelings a trader must be prepared to experience.  These are the thoughts and feelings for which a trader must have a plan for circumventing.  The best thing we can do is never get to that state in the first place.  There are tons of efforts and practice and market preparation and personal self-improvement exercises we can do to continually minimize the frequency and intensity with which we come to these moments.  But, alas.  We are human.  We are not perfect.  And no matter how good we ever might get, that will never change.

So how does one de-energize the emotions and feelings and thoughts and beliefs and frustration and boredom and disappointment that we encounter when we’re not getting the sweet trade opportunities we want?   Unfortunately, that’s a very personal thing.  The first step, however, is having a system that enables you to acknowledge that you don’t get it.  That it doesn’t make sense.  And for as long as that’s the case, there is no edge here, and there is no trade.  What you do next — going for a jog, catching up on your backlog of Modern Family, or kicking back from your trading desk and taking another stab at your top-down analysis of where the market is in a fresh attempt to attain a greater level of clarity — it doesn’t matter.  Just be cool with it, and remember that no matter how you feel or how the market looks now, eventually the market will return to a condition that makes more sense to you.  And you will return to a mental state where you’re capable of making sense of it.  You have to really know and truly believe that.  It’s the fully knowing and the fully believing of that that will enable you to step back now with minimal frustration, disappointment, or stress.

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One more thing — when you come back and review the chart at the end of the day, be prepared for the fact that you”ll almost certainly experience an “Are you serious?  How on Earth did I not see that?” moment.  That’s ok, too.  Being a trader isn’t about being on your game all the time.  But it most certainly is about — among other things — keeping your cool and not forcing trades when you know you’re not on your game.

Enjoy being an imperfect human.  You’ll be one for the rest of your life!