Tag Archives: Mindset

Managing Anxiety While In A Trade

 

The following is a great question from YTC reader Aaron.

I thought this would be worthy of entry into the blog and newsletter as it's a question which will be relevant to anyone who allows discretion in their trade management plan.

And I'm really keen for anyone else to add their ideas and thoughts into the comments section of the blog post.

Question Received:

Super impressed with all your content. Do you have anything out there on managing your psychology while in a trade? I find I often deviate from my plan due to anxiety from who knows what.

My Response:

Hi Aaron,

Off the top of my head these come to mind:

(1) General psych content which may or may not offer something of relevance:

 

(2) Perhaps more targeted directly to your question:

 

But more importantly, give this a try. It's the general framework that I use whenever stuck with any problem like this:

 

Set aside some time and just brainstorm any and all options which might fit within these categories.

The fact is that there will not be a "one size fits all" solution for this problem of anxiety interfering with trade management. You might need to go through a process of trial and error.

So do the exercise and see what you come up with.

For starters, a few obvious ones:

AVOID:

  • Just go complete passive. Set the stop and target and walk away. Let it fall wherever it falls. (Not my preferred approach, but some people need this)

 

REDUCE FREQ/CONS:

  • Partially passive in that decisions and actions are ONLY made at certain times or price points. eg. the obvious solution here is when you only assess the trade on the close of each TTF candle. Inbetween these "decision points" you might find it helps to step away or look at other screens.
  • Closely aligned to the above idea, just push your chair back away from the screen immediately after the order is filled and initial stops/targets are set. Don't laugh. It's very effective. If you're out of reach of the keyboard and mouse, it's a whole lot harder to emotionally react.
  • Another option for "partially passive" is to actually split the position into two. One part is managed through a passive set & forget target. The other allows discretionary adjustment. Essentially you're diversifying your trade management across both styles. As a bonus it allows you to directly compare the impact of discretionary versus passive trade management and you'll clearly see whether or not you're adding to or reducing your edge.

 

Your turn. I'm sure there are a ton more. See what you can come up with.

Nice question by the way.

Happy trading,

Lance Beggs

 


 

Today – Anything Can Happen

 

I sent out the following social media post last Saturday:

<image: E-mini NASDAQ - All Time Highs>

All-time highs in the NASDAQ! Incredible when you consider where we were just two months prior. And of course when you consider the current state of the world.

But that's the nature of markets. They don't care what we think.

So I thought I should expand upon two of the statements within that post.

"Are you able to reframe your beliefs to allow you to operate more effectively?"

"Can you separate your narrative about the world from your job of recognising and adapting to the actual market bias?"

Because, as an intraday trader, one thing that is absolutely devastating to your P&L is attempting to trade a personal feeling that is not aligned with the actual direction of the markets.

I can completely understand anyone who feels that "This market is so overbought. It doesn't make sense. The crash is coming for sure. This thing needs to go down."

I've been there myself.

And the feeling is not a problem. It's acting upon that feeling that is the problem.

It's positioning short when the market just continues on higher, caring little for you, your beliefs and your long-term viability in this trading game. That destroys accounts.

So the rally continued. Here's the NQ at the time of writing this article, about eight hours before the open on Thursday morning.

<image: E-mini NASDAQ - All Time Highs>

Success in intraday trading requires that you find some way to separate your FEELINGS about the market from your ACTIONS in trading the market. Leaving you free then to trade whatever direction the market moves, despite your underlying beliefs.

Here's a simple method I use:

Shift your beliefs and expectations further into the future.

In three steps:

(1) "I feel that this is so overbought that it just has to fall."

(2) "But that doesn't have to happen today. Maybe tomorrow. Maybe next week."

(3) "Today – anything can happen!"

So not only do I acknowledge my feeling and belief about potential market movement. I also allow it to be true.

But not necessarily today.

This frees me up to accept, recognise and adapt to whatever direction the market wants to go.

As shared in Wednesday's social media post:

<image: Freedom to adapt to actual market conditions>

Repeating for emphasis – "Being open to all three possibilities allows me the flexibility to adapt to actual market conditions. And to recognise and adapt to changes in sentiment and structure."

Because today (and in fact every day) – anything can happen.

<image: Monday>

<image: Tuesday>

<image: Wednesday>

Right now it's several hours before the open on Thursday. The markets feel even more overbought to me. But that doesn't mean it will fall today. It might. But it could also wait till Friday. Or maybe next week.

Today, anything can happen.

Becoming stuck in a mindset that the market SHOULD do one particular thing, just because you FEEL that it should, is poison to your account balance.

You have to find a way to separate your feelings about the market from your actions in trading that market. And then allow yourself to be open to all possibilities, ready to recognise and adapt your trading to the ACTUAL market conditions.

This is the plan that works for me – shifting my expectations forward in time. Hopefully it helps you as well.

Happy trading,

Lance Beggs

 

PS. Thursday update:

There's the fall I was expecting…

<image: Thursday>

<image: Thursday>

<image: Today - anything can happen>

 


 

Sometimes It Takes Multiple Attempts – 2

 

Tuesday's trade sequence reminded me of this article from last year – Sometimes It Takes Multiple Attempts.

Where the market reminds us that it doesn't give a damn about our expectations for a quick move from entry to the target.

And that sometimes, it would rather play a bit first and see if it can stop us out. 

<image: Higher Timeframe Context> 

I just love these narrow range holiday sessions. They provide a good "line in the sand" from which we can determine bigger-picture sentiment – bullish above and bearish below.

So yes, despite the low volume I do consider them relevant enough to mark on my charts as S/R. 

And so, prior to the session open, I sent out the following social media post. Please note that this is a repeat of a 2019 post so the price action is different to today's action. But it's the concept that is relevant.

<image: Question - Do I use the narrow range holiday sessions as SR?> 

So here's the plan today:

<image: The Trading Plan> 

<image: The Trading Plan> 

Sounds easy, right?

Let's drop now to the 1 minute Trading Timeframe:

<image: Sometimes it takes multiple attempts>

<image: Sometimes it takes multiple attempts>

<image: Sometimes it takes multiple attempts>

<image: Sometimes it takes multiple attempts>

<image: Sometimes it takes multiple attempts>

<image: Sometimes it takes multiple attempts>

<image: Sometimes it takes multiple attempts>

<image: Sometimes it takes multiple attempts>

<image: Sometimes it takes multiple attempts> 

A few thoughts post-session:

(a) It's unrealistic to expect that every trade will go immediately to your target. Sometimes a trade idea will require multiple attempts.

(b) Two failures – stop and reassess. Reconsider the original trade premise, but also be sure to consider the idea that you are completely wrong. And also that maybe you have no idea of what is happening and need to stand aside.

(c) Three failures – time out. Wait for a change of structure and only then look for the next trade idea.

(d) And maybe… consider the idea that a key goal in your trading should be to not only know how to find quality trade ideas, but also to get good at surviving those times when the trade idea doesn't quite match what the market is actually offering.

Because sometimes… it takes multiple attempts!

Happy trading,

Lance Beggs

 


 

The Day After a Bad Performance Day

 

Last week we looked at a session that caused me some troubles. See here if you missed it – Good Trading Isn't Just About Winning Trades.

It wasn't a losing day. A "bad" day isn't necessarily a losing day. This one profited. Cycling from negative to positive and back again to negative and then to positive, before I finally called it a day.

What makes it a "bad" day was my poor performance.

My poor decision making. My poor execution.

<image: The Day After a Bad Performance Day

It happens. I just wasn't with it that day.

Sometimes I can brush it off easily. Especially when it didn't lose.

Laugh at myself. Get over it. And move on.

But other times… like this time… that's not so easy.

Perhaps it's the ongoing COVID-19 isolation fatigue? Who knows?

All I know is that I can't let it infect the next session.

So here's the plan for "The Day After a Bad Performance Day":

I can't do anything to influence the market, obviously. So the focus needs to be on me and on my interaction with the market. The things that I can control.

Fixing your Mindset

The problem here is simply that the mind is "stuck". It's anchored to the negative outcome from one single session.

We can fix this with two steps:

(1) Let's shift the mind from its current negative feelings to something more positive.

I recommend you keep a folder containing printouts (charts, trades, stats, whatever) that show examples of you at your absolute best. A "highlights" folder. Best trades. Best sessions. Equity curves overcoming drawdown.

And most importantly for our current situation, include at least one example covering two sessions where poor performance in the first session was followed by good performance in the second.

Keep this in your trading room. It will become your GO-TO tool for shifting focus quickly.

A reminder that the performance yesterday was an aberration. And that you are capable of so much more – because you've done it before.

And if you haven't done it before, then make it up. Because you WILL in time. You just haven't done it yet. Perhaps two printouts of yesterday's performance, one showing actual results and one showing ideal performance. It's something you may not have achieved yet but you know you damn well can next time.

A "highlights" folder. Create one if you don't have one.

And then use it.

(2) Let's shift the mind away from its single-session focus.

Yesterday was one day. If all goes well, I'll be trading a few thousand more days over coming decades. Yesterday is insignificant.

Take a calendar or diary covering at least a year into the future. And skim forward in time and have a look at a whole lot of days to come. And ask yourself, given all those days available to improve on your recent performance, does yesterday really matter?

And then turn today's page. This is the only day that matters now. And it's a blank sheet. And it offers a perfect opportunity to create a new entry in your "highlights" folder, as you follow up yesterday's poor performance with an example of you trading at your best.

Planning your Interaction with The Market

The aim here is to simply ensure you get the session off to a good start. That doesn't necessarily mean a winning trade. The outcome is somewhat out of our control. But it means A GOOD TRADE.

However you define them. An A+ Trade.

One that you would be happy to print and put on your wall. One that you would be happy to screenshot and send to me.

Even if it loses. A trade that you know that you HAD to take. It had edge. It was the right thing to do at that time and that place.

To give yourself the best chance of achieving this, you need to slow down. Be comfortable with no trades at all, until sufficient structure is in place such that you have a GOOD READ on the market and are completely in sync with the price movement. No trades at all, until you find one that you'd be happy to take if you were only allowed to take one trade this day.

That's all you need:

  1. Focus on the positives by skimming through your "highlights" folder.
  2. Recognise yesterday as insignificant in the context of a multiple-decade career. And see today as an opportunity to add to your "highlights" folder.
  3. And then slow yourself down. Commit to no trades, until the market is screaming out to be traded with an A+ trade opportunity.

 

So let's trade…

<image: The Day After a Bad Performance Day

<image: The Day After a Bad Performance Day

<image: The Day After a Bad Performance Day

<image: The Day After a Bad Performance Day

Moving forward a few minutes… and compressing the data slightly so that I can fit more price action…

<image: The Day After a Bad Performance Day

<image: The Day After a Bad Performance Day

<image: The Day After a Bad Performance Day

<image: The Day After a Bad Performance Day

There were no real secrets here in managing my performance, on the day after a bad performance day. Just a short process to get my mindset right. And to take my time, happy with no trades at all if conditions were poor. Waiting and watching until a trade set up that I knew I could look back upon in the post-session and say with 100% certainty that it's a good trade. Win or lose, it wouldn't matter.

I guess the obvious comment is: "Shouldn't all trades be like that? And shouldn't all sessions be traded with this patience?"

Yeah, sure!

But let's be real.

They're not all like that. There are always going to be some that are a bit questionable.

The aim on a day after a bad performance day, is to just slow down a little and make sure that the first trades today are NOT questionable at all.

Three simple steps:

  1. Focus on the positives by skimming through your "highlights" folder.
  2. Recognise yesterday as insignificant in the context of a multiple-decade career. And see today as an opportunity to add to your "highlights" folder.
  3. And then slow yourself down. Commit to no trades, until the market is screaming out to be traded with an A+ trade opportunity.

 

Happy trading,

Lance Beggs

 


 

Good Trading Isn’t Just About Winning Trades

 

There were two lines in last week's article, which I want to continue exploring today.

Good trading isn't just about winning trades.

Just as important is managing yourself during those times when you don't have a good read on the market.

This business is HARD. And I tend to perhaps focus on the negatives a little more than some readers like. But this aspect of the game fascinates me.

Anyone can talk about the easy sessions, with directional markets and quick profits. But I want to talk about those times when we struggle. How we make decisions when under pressure. And how we can best manage our performance to safely close out the day and survive to trade again tomorrow.

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

So let's have a look at Wednesday and see how I managed my performance, on a day when fate decreed that very little should go right.

And yet, I somehow managed to get out of it with a slight positive result. I guess, as per the notes in the image above, that makes this a damn good day.

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

<image: Managing your performance when it's just not working to plan>

Wrong direction entries – they happen.

Neutral openings chopping above and below the opening range – they happen.

Impulsive entries, in places and times you had no intention of trading – they happen.

Your job is to manage your performance such that these things do not destroy you.

Recognise… and adapt.

The key lesson to surviving days like this is simply the following – recognise it happening quickly – and STOP TRADING.

The odds are that the longer you continue to trade in these conditions, the greater the likelihood that you'll grind your way down to your daily drawdown limit. That is not a good outcome for your account. And not a good outcome for your mindset.

You've got to stop.

You don't have to trade every market sequence. And you don't have to trade a full session every day.

If the market is offering crap conditions or if you're just out of sync with the flow of the price action, get out of there.

Come back tomorrow, when everything is new and you're ready to start again with a clear mind and a positive attitude..

<image: Managing your performance when it's just not working to plan>

Good trading isn't just about winning trades.

Just as important is managing yourself during those times when you don't have a good read on the market.

Recognise that it's not working. And STOP.

Tomorrow is a new day.

Happy trading,

Lance Beggs

 


 

Recognise when it’s not working – and ADAPT

 

The plan was simple. Catch the opening drive. And bask in the glory of a winning start to the new session!

<image: When you're out of sync with the market - recognise it and ADAPT!>

<image: When you're out of sync with the market - recognise it and ADAPT!>

<image: When you're out of sync with the market - recognise it and ADAPT!>

<image: When you're out of sync with the market - recognise it and ADAPT!>

<image: When you're out of sync with the market - recognise it and ADAPT!>

<image: When you're out of sync with the market - recognise it and ADAPT!>

<image: When you're out of sync with the market - recognise it and ADAPT!>

<image: When you're out of sync with the market - recognise it and ADAPT!>

<image: When you're out of sync with the market - recognise it and ADAPT!>

Three failures… compulsory time-out!

Note that this doesn't necessarily mean three losses. The first two were small wins. The last was a small loss.

I'm still in front.

And now have some important information.

THE MARKET IS NOT IN AN OPENING DRIVE.

So it's time to put the mouse down. Step away and clear my mind (it doesn't take long – I was gone for maybe 30 seconds at most).

And then reassess.

There are generally two ways I'll play this.

Option 1 is to just pack up for the day. Today is too early for this. But if I hit a stretch where I'm out of sync with the market, say as it's approaching midday, I see no problems with just calling it a day and making sure that the small profit does not turn into a loss.

Option 2 is to bracket the whole area and then wait for price to break clear and show improved conditions. In particular smoother price flow! Then it's game-on. Reassess the trend, project it forward and identify the next trade opportunity.

<image: When you're out of sync with the market - recognise it and ADAPT!>

<image: When you're out of sync with the market - recognise it and ADAPT!>

Good trade.

Unfortunately this was the extent of the directional move and the market settled into some sideways ranging action.

<image: When you're out of sync with the market - recognise it and ADAPT!>

I'm actually quite happy with this trading.

Six trades. Only ONE went to plan.

Of the other five, one was a loss but the other four all provided partial small wins.

When you're not reading the market well, anything positive is a winner.

Lessons today…

Good trading isn't just about winning trades.

Just as important is managing yourself during those times when you don't have a good read on the market.

Because they DO happen.

Recognise when it's not working. And ADAPT.

Protect any profits, if you're lucky enough to have them. Or if you're on a loss, stop the bleeding.

Step aside. Clear your mind.

And if you want to continue, do so on YOUR terms.

Bracket the area which is causing your problems. And visualise. When price eventually breaks clear of this current chop, what conditions do you need to see before you will engage the market again?

Recognise when it's not working. And ADAPT.

Happy trading,

Lance Beggs

 


 

Step Back and Reassess

 

Let's start with a daily chart to get some "bigger picture" context…

<image: Step back and Reassess>

<image: Step back and Reassess>

And now down to the trading timeframe…

<image: Step back and Reassess>

A little side note regarding the entry: While it may not be immediately obvious, this trade is a variation on the YTC Price Action Trader PB Setup. The pullback is all occurring within the one single TTF candle (in this case the green one prior to entry). While that is not ideal and we would prefer to see an actual pullback of at least 2 or 3 candles on the TTF, the fact remains that in an opening momentum drive this is often all you will get. So we either miss out entirely, or adapt. In an opening drive, I'll be looking to the LTF data for the first pullback. Everything else (eg. LWP entry timing) is as per normal.

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

If you've lost all feel for what is happening in the chart…

(1) Step back.

(2) Define the edges of the structure.

(3) And wait.

Whatever happens within that no-trade zone, is none of your concern.

Let it break and then reassess.

Only then, if the market structure and price movement makes sense, is it game on.

Assess the trend structure. Project it forward. Identify your opportunity. And strike!

Happy trading,

Lance Beggs

 


 

Confidence in the Trend

 

I've been discussing this idea for quite a while now. The idea that there is GREAT VALUE in studying your charts post-session to identify the price sequences which offered the best trading conditions. And then… the structural features which might help you identify similar trading conditions next time they occur.

Just last week in our newsletter I shared the following social media post

<image: Where does price move best?>

This is not just something we do for fun.

The exercise has clear and obvious benefits.

One of them being – when I see these patterns set up again they give me CONFIDENCE in the subsequent trend.

The image above gives one of these patterns.

Tuesday's trading gave us another…

Let's start with the 15 minute higher timeframe at the time of session open.

<image: Where does price move best?> 

<image: Where does price move best?>

<image: Where does price move best?>

<image: Where does price move best?>

<image: Where does price move best?>

<image: Where does price move best?>

<image: Where does price move best?>

<image: Where does price move best?>

<image: Where does price move best?> 

Not all trading conditions are equal. There will be times when the markets provide conditions that best suit our strategy. At these times we need to be focused. We need to know what we want to see to confirm these favourable conditions. And we need to be confident and ready to act decisively when they appear.

And there will be times when the market provides conditions that are less suited to our strategy. At these times we need to step back a little. Be happy to pass on anything that is not screaming out to be traded. If we miss opportunity, so be it. Let it go. And wait for something more favourable.

Post-session study lets you identify those sequences which best suit your style of trading. And to identify the structural features or patterns which might suggest a repeat of these conditions, should they set up again in the future.

For my own personal trading, I perform better in directional markets with nice smooth stable trends. The overnight volatility contraction is one pattern that has me primed and ready for potentially good trading conditions from the open. A pattern which provided me with confidence to TRUST the trend, should it develop from the open.

Are you aware of the conditions which you find most favourable? And the structural features or patterns which might help you identify these conditions again in the future?

If not, you have work to do. Study the charts for those areas where you see that "price moves best". And make sure that next time the market offers similar conditions, you're ready and focused, with the confidence necessary to attack that market opportunity.

Happy trading,

Lance Beggs

 


 

Trader Motivation

 

For the first time in maybe a decade I'm not writing a post this week. Not because I lack motivation. But rather, because I've come across an exceptional resource (from Alex Vermeer) that I want to share with you.

The journey to becoming a trader is a long and frustrating one. So the more you can provide yourself with knowledge and skill in maintaining motivation, and in overcoming lapses of motivation, the faster and more effectively you will progress.

If this is an area you feel you can improve, please review and make use of the following information.

Step 1: Read the following two preliminary articles… and implement the advice they offer.

(a) Part one – Things we can do IN GENERAL to reduce procrastination

(b) Part two – Things we can do RIGHT NOW to reduce procrastination

Step 2: Go to the following webpage to download a copy of the summary "How to Get Motivated" poster. Save it and make use of it to trigger changes in behaviour, whenever you need a motivational boost.

Link: https://alexvermeer.com/getmotivated/

Scroll just over half way down the page to find the posters in various sizes.

<image: Trader Motivation>

(Source: https://alexvermeer.com/getmotivated/)

I hope this helps provide you with some clear and actionable plans for beating procrastination and doing the work necessary to make this year the best yet.

Happy trading,

Lance Beggs

PS. I discovered this great resource through the weekly newsletter provided by Recomendo – https://www.getrevue.co/profile/Recomendo