Hello Traders.
I am hard at work on the Pro Trend Trader course at the moment, but I always manage to find time to stop and read the blog posts from T-Model and Craig with a coffee in hand. I hope you all enjoy!
James Orr
To be… (Right)…or not to be… (Right)
I headed off on
my morning pilgrimage to the local café for the daily journal writing a few
days back, forgetting that I had completely filled my trading diary cover to
cover the previous week. So instead of writing, I sat there flicking through
the many pages, laughing mostly, cringing at times, but in general, fascinated
by the many twists and turns that have taken place.
I came across an
entry from mid-last year that caught my attention, to which I wanted to speak
about. But firstly, I want to give a past work scenario to help explain.
A woman came to
have a counseling session some years ago. After getting settled she began to
explain what the issue was that brought her here and spoke clearly with insight
about what was causing her problems. Added to this, her ability to see the
problem from a variety of different angles was also very strong. In retrospect,
I couldn’t have got a better run down of the situation.
Before I could
respond in anyway at all, she then explained, again in some detail, exactly
what she felt was needed to address the situation for the better. In a similar
manner, she appeared to have thought it out clearly and from several differing
angles of approach.
At this point and
I was beginning to wonder why she was here, as it seemed clear she knew what to
do. That day also happened to be my birthday and for a moment or two I thought
I was about to be at the butt end of some prank, with people bursting into the
room or the likes. But no. This was real.
As her accounts
of the problem and solution were very through, a period of time had already
passed by before she momentarily drew breath. During this pause in her
descriptions and pondering upon my first response to all that I had heard, I
was about to say something when she continued with….. “What if I am not right”?
It all came down
to that sentence…. “What if I am not right”? In that sentence lay the paralysis.
There lurked the foreboding reality that after so much thought and
self-appraisal, that there was still that chance of “right” not being “right”.
It was amazing to see an intelligent, articulate and capable person so
completely frozen in fear and terrified to take “that” first necessary step,
when it appeared that she had actually outlined what those “next” steps could
be.
There is
something of great interest here in what she stated about being “not right”.
She didn’t use the words “get it wrong” and this I believe is most important.
This is in many ways similar to what I said in an earlier blog about having
spent the year trying to “not being a failure” at trading, rather than, “aiming
to be a success”. Perspectives are so fundamental.
After a few
sessions together, one of the themes that appeared is that it would be humiliating
to be “not right”. Her high profile work also needed her to be “right” at all
costs as well. She was at the time a senior advisor in the federal government
at very high levels. Being “wrong” was just a human thing that happens to
others, but not to her.
It was in May
last year that this happened for me on the Ftse 100. I had loaded in all the
zones for the day’s trading. Having listened to the analysis videos, I then
checked out the different time frames to get my sense of the market. It certainly
appeared that buys were definitely showing greater strength in this market.
About hour later,
price had slowly wiggled down into a zone in a lack luster movement lower,
which also gave me a sense that an upward move was more likely. This was also
an identified buy zone as well from the morning review. To add to the picture,
at the bottom of this zone was the 200 ma, sitting just above the pivot.
Then a buy pin
bar formed. Price went up a little, then jiggled back down a little and formed
another bullish pin, creating a nice double bottom, just to add to it all.
Then I just froze
up.
I spent the next
couple of hours watching price saunter upwards, bouncing off the 8 ma like a
perfectly shaped stone skips over water. It went up and up and UP. Yep…..I
watched the whole thing. I really can’t remember a trade set-up as juicy as
that ever. It was like that “perfect storm” scenario where everything just
lines up to create something profound. It was confluence on steroids.
I had been sitting
there looking at the chart going…yep…yep...yep…..it’s all there….get ready to
enter a buy position, when I just choked and couldn’t do anything. This
particular trade “implosion” just hung around in my psyche for months like a
benchmark of…of….well….stupidity…..dumbness….and the likes.
It wasn’t until I
read about this trade again recently in the diary, that I recalled the session
written above and the woman’s fear of not being “right”. I had thought previously,
that it could have been because it was confluence overkill and that something
inside me began to doubt the reality of what I was seeing. Or maybe it was
something that was just going to happen at some point and that was the day.
What I do
remember thou, was that same feeling as the woman spoke about… “What if I am
not right”….creeping into my mind. Given the overwhelming confluence of several
factors all lining up, then there was also every chance of being “right” on
that trade. But that day, the fear of not being “right” won out.
It was like
someone turning the lights off unexpectedly, and I just sat there in this
suspended state. As there were a couple more signal entries that I could have
taken after those two pin bars, then this wasn’t a fast moving…. “oh bugger I
missed it” sort of thing. It was like my hand couldn’t move the mouse to click
the buy box on the screen. I wrote in my trading journal back then… “My brain
seemed unable to generate the sparks of action”.
I have
experienced those feelings on many occasions that come in the early days of
trading. Call it doubt. Call it nerves. Call it the… “What if I am wrong”
scenario. But this was paralysis and I can now see that it was based on that
sense of potentially not “being right”.
On that day the
market did what it always does. It offered me information…nothing more and
nothing less. Yet that day, for whatever reason, I seemed to internalize the
potential outcomes as a personal thing, which it is not.
I could set off
and analyze this to the cows all die of old age, but in the end, like the woman
in the session, the fear of being “not right” crippled the situation. I think
that underlying this reality is that I, for whatever reason again, lost
perspective that there is always an “uncertainty” in trading, and that it is my
task to load the probabilities in my favor.
In sitting there
reading the journal, I noted that, like this situation outlined, there are benchmarks
of trades that have acted like beacons in my development. Like that skipping
stone, at some point it has to descend and hit the water in order for it to fly
again. I guess that these trading moments are like points of friction that test
the strength of the development at hand. It is also interesting to note in this
regards that this “trade” was actually a “non-trade”, as nothing actually
happened. Yet it still made an impact.
Till next time
T model.
No comments:
Post a Comment