Several people have already shared some great thoughts on this topic. Rather than rehashing what's already been said, I wanted to share a couple resources on the topic of habits.
I juust started reading The Power of Habit a few days ago and am already really digging it. It's no surprise that firms spend tons of money building trading algos. Companies have been using the same idea to capture more customers and dollars for years.
Originally, I was going to post this to my journal but when I did a search for 'habit', this thread seemed like a more appropriate landing place. I can't even begin to adequately convey how much I love this stuff
Hopefully between the different contributions received, samurai is able to implement a sustainable habit-changing strategy. Either way, you know we'd love to be kept up-to-date on your progress
Move along ...
Luck is what happens when preparation meets opportunity. ~ Seneca
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I too read and enjoyed The Power of Habit. There is a good review at Psychology Today.
The interesting thing is that the methods espoused in the book generally work for simple habits. But the issues we face in trading are less amenable to that style of habit modification. To get an appreciation of the issue have a look at this video which is referred to at the bottom of that review. It's actually got some good ideas relevant to our task: Presentation at the Habit Design Meetup
You might have a look at the book "The Willpower Instinct" by Kelly McGonigal. It's also enjoyable, is science based, and has some useful ideas for traders working to increase their ability to execute their plans.
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Jumping out of a 2 story window every time you violate rules.
If nothing else works.
"The day I became a winning trader was the day it became boring. Daily losses no longer bother me and daily wins no longer excited me. Took years of pain and busting a few accounts before finally got my mind right. I survived the darkness within and now just chillax and let my black box do the work."
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LOL. I'm actually thinking of using some compulsion on self when I make a 'mistake' in my trading. For myself a 'mistake' does not equate to a loss or even profit, but a violation of a cardinal rule. Create intense pain to get that emotional trigger.
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Breaking a bad habit is in large part a leap of faith. However, I don't think your trade idea is necessarily a bad one.
I think pullbacks in trends are great entries. Losing trades will happen sometimes. The key for me is entering the same way every time. If if I repeat the same thing with each trade and it's not working for me, then I need to adjust either my entry or my stop.
Strategy ≥ Money
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Something different to think about, and not yet mentioned.
You need to be more aware of what 'you' are thinking and doing. By 'you' I mean the habit-ridden self that sabotages our trading. Try mindfulness meditation but be warned you will need to commit to regular practice to achieve a lasting solution. It will impact much more than trading too.
Here's a surprisingly cheap book that covers 100% of what you need to know:
Ok you didnt provide a chart but i get what you're saying.
It's not that this is a bad trade. It could of worked.
When you make a trade you need to think about who is going to come in after you to push the price down?
What you want is big players pushing the price down.
In this case i feel that it might of been the end of the that trend and sellers from previous where still covering helping to push the price up. Also there would of been new buyers entering the market too.
You can't really break a bad habit until you know why you need to break it.
If your a novice you need to think about trading as a game and the above is probably not going to make sense at all. Especially if you're day trading. What are the big players doing and are the big players going to come in after me to push the price my direction.
I have to break bad habbits all the time. Right now i always miss fade trades. So i visualise making them for 10-15 minutes a day. I also journal a shit load.
If you want to compete in this industry and don't get slaughtered by guys who take this seriously such as me you need to visualise too and journal even more then i do. By doing this you will eventually break the bad habit.
Good real prop traders are always looking to get better. So they too are always breaking bad habits. What i mentioned is how a lot of prop traders and I do it.
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It's because people vary that I believe posting a variety of links is useful.
The ones you posted are an interesting idea - certainly it's straightforward enough to program one of these gadgets to give you a zap if you visit the 'wrong' website. But how to link that effectively with breaking certain trading habits?
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