[TheNegotiator]

Originally Posted by Tradewinds »

I can get into a cycle of bad trades. I make a mistake, and then get out of a good trading rhythm. When I'm marching along with the market, the P/L just keeps ratcheting upward. If I get "out of step", and then don't take a few moments to figure out what is going on, then I start making one bad trade after the other.

If I believed in conspiracy theory, I would tell you that this is what the market is designed to make you do. And sometimes I mindlessly let the market brainwash me, and take me for a ride. Maybe the broker is flashing subconscious messages on the screen to make me take bad trades. lol. Oops, I better not give them any ideas.

I know this isn't directly relating to what you said, but it is a good illustration of my point.
I have heard it said that for example the e-mini s&p is designed to stop people out. Every move is just happening to force one set of traders out. Well I think this is a cynical way of looking at things. The market is very big and liquidity is high. All kinds of traders doing all kinds of things. Momentum plays a big part in how this market trades because of this. So when it overshoots, weak players(and others) are relenting and a climax peak in trading happens. This tends to then bring in traders from the opposite side who are waiting to enter at a better price. Once this is reached they quickly take a position which moves the market back. Seeing this, a trader with a profitable position may want to take some profits and lighten up.

So my point is market behaviour can always be viewed negatively if you are in a certain frame of mind. However, most of the time there is a mechanical explanation which is a function of cumulative market participation.

[Arthur]

yes psychological and emotions really effect the trading. Special we may be the victim of escalation de commitment ; entering into a false decision and continuing it even after we know it . But what about the suggestion of entering being fearless and entering the target ?It might cause more loss ....

[Tradewinds]

Originally Posted by TheNegotiator »

So my point is market behaviour can always be viewed negatively if you are in a certain frame of mind. However, most of the time there is a mechanical explanation which is a function of cumulative market participation.

That's a good point. To take your point further, and relate it to trading psychology; a negative view of the market could become a self-fulfilling, self-destruct exercise. If the trader is focused on a negative view of the market, that becomes the focus of their attention; as opposed to being focused on trying to understand the market.

It's an exercise in simply filling the mind with a clean and accurate view of the market. I need to have an unbiased, and balanced perspective of the market.

Simply accept what the market is, and is not, and execute the probabilities.

[TheNegotiator]

Definitely. It's so easy once you start thinking negatively to fail and get stuck in a rut. I don't know if you like sport, but I watch (english) football and it is very clear that some teams that do badly are suffering mentally most of the time, more than they lack ability. Conversely, this year a newly promoted and not especially highly regarded team - Blackpool, have far exceed what was thought was possible from them.

[Tradewinds]

Originally Posted by TheNegotiator »

I watch (english) football and it is very clear that some teams that do badly are suffering mentally most of the time, more than they lack ability.

That is an excellent example. I see the same thing all the time myself, but with NFL football. It's so obvious. Players and teams will get upset after having some points scored against them, and they can't overcome their emotions, even though they are the better team.

In practice trading, I can loose a lot of money, and then come back and never have a loosing day. I don't ever loose money for the day in practice trading. In real trading, I might have a hard time loosing a large amount of money right off, and not make it back.

[TheNegotiator]

Success trading isn't contingent on the following, but it certainly helps not just from an a/c balance perspective.

Many times during my time as a trader so far, I have heard of traders who go on to be successful after plodding along doing not well but not badly. They have one trade that 'makes' them. One super sonic trade that just gives them the confidence and which is backed up by a/c balance. I am certainly not an advocate of trying to go for these trades all the time, but if you just have an opportunity and it pays big, you're set. Same thing with football at the other end of thee scale. The more I look at it, the fewer top teams that there are about which are actually head and shoulders above the rest in terms of ability.