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Distinguishing impulse from intuition
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Distinguishing impulse from intuition

  #1 (permalink)
Trading Apprentice
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Distinguishing impulse from intuition

Hello, Everyone!
I am a new trader and I would like some input or techniques in how to distinguish impulse from intuition. I feel that my impulsive nature is completely holding me back from making consistent profit. I find that I am most impulsive when the market opens and as the day progresses forwards the impulsiveness dies down and reasoning takes over. I also know that I am most impulsive at that time because I'm both nervous and over anxious as its the beginning of the day. What can I do to subdue the impulsive tenancies? What distinguishes impulse from intuition?

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  #3 (permalink)
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Define rules rather than depend on intuition or impulse


IMPULSE OR INTUITION — WHICH? — Howard Utter

What is Intuition:
After years of practice your subconscious is trained to understand what needs to be done. This knowledge is not available to the conscious mind.

What is impulse:
Your frontal lobes (again not conscious mind) instructs you to act in a manner that relies more on animal instincts inherited from our anscestors.

Ideally:
Have a set of rules. Define them. Practice the rules and tweek it. In the process the subconscious gets trained and also in the process there will be more confidence in what is conveyed by the subconscious. It is like driving the car. We do not put conscious effort ( or rarely do). Ideal trading is like that. But need lot of screen time to get there.

Hope this helps.

You can practise your skills all day long, but it's comparatively easy to get better at playing. The hard thing is to get better at winning--anonymous
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  #4 (permalink)
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If the trade is a winner it is "intuition", if the trade doesn't work out so well then it is "impulse".

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  #5 (permalink)
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From Alphatrends this morning:

"OK, maybe you don't smile in trouble and don't realize the strength from distress till long after the event has passed. But bravery is definitely something to be recognized after you have time to reflect. Instincts give certain traders an advantage, but trading can be learned if you are brave enough to reflect honestly and objectively about your actions. “If you don't know who you are, the market is an expensive place to learn"

Rejoice in the Thunderstorms of Life . . .
Knowing it's not about Clouds or Wind. . .
But Learning to Dance in the Rain ! ! !
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  #6 (permalink)
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Maybe i will not answer your specific question but one thing i can tell you, one of the things i do to help me stay focus and avoid impulse trading is to have a jump rope next to me or do some push ups while trading.

Why? There are some times when i feel a rush after a losing trade or after a winning trade. When is a losing trade i start to think, what if i make a mistake again and lose more money? When is a winning i think, what if i do something wrong and i lose what i already have? This not always happens but when it does i know all i need is 5-10 minutes doing rope jump or a series of push ups.

At the beginning is hard because you may thing that you are going to lose precious trading time but after a while you will start to see consistency in your trading and after all, if you trade with that feeling inside generally you are going to lose money.

Maybe it has a scientific explanation if it does i don't know it. By common sense i could tell you that you burn that feeling of anxiety by doing some fast work out.

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Impulse just means you will lose money faster than intuition without impulse. But trying to use intution eventually will lose. Save yourself some money and develop a system that can be statistically measured over and over again.

"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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My take on this would be that, Impulse is what you feel from external pressures , e.g you lost some money and you want to end the day flat, or you won some money and suddenly gained too much confidence

While intuition is something you believe is right but could not explain it with logic

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  #9 (permalink)
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For me at this point in my youthful Trading development, I notice...
when I am able to feel either no emotions, or only play with Positive-emotions, I'm happy with trade results
but
when ridiculed, or judged "incompetent" (for being content w/ just 1/2 to 2 points per trade day), my trading increasingly goes awry, &
then start going down a losing streak that totally destroys my confidence, & have a very hard time pulling myself out, &
back to *Intuitive trading* where I just mostly play... Really, I am able to play & actually then trading is fun...

Been told for several months now that am clueless, don't know what is going on, & am in fact hopeless. - But from other contexts in my life of using Intuition skillfully, I think I am in the wrong group, & need different teaching & encouragement, enabling me to empower myself to use a combination of money-management skills, & trade-skills coupled with my Intuitive skills to earn $ in the market.

This is my first day of sticking my neck out here in this vast Forum, so hopefully someone will offer some kind words. Thank you

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  #10 (permalink)
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Great question. The first thing that must be understood is that there is a huge difference in how experts and novices perform and thus the types of rules or lessons that apply to each. Most trading psychology books and materials are written for novices.

How do you know if you're an expert? The most important thing is that an expert can know when they are more likely wrong or right on a trade. So, a trader's confidence has high correlation with probability of a trade working. Likewise, expert traders are more aware of just how "low" or "poor" the odds are. So, they have more accurate estimation of their edge. This is not to say that experts sometimes don't make mistakes too. For example, just because confidence will correlate with trade quality doesn't mean you can automatically reduce the stop size and throw on a ton of contracts. That's a mistake I've made before. One must understand that the probability of the trade working will change as the stop loss size changes. In other words, accurate cognition will reflect the changing probabilities and understanding of when extra size can be added. So, there are levels of expertise.

So, let's recap: an expert knows or has a good sense as to the quality of their trade working out and this is called "intuition". Intuition is fostered by a listening to one's internal mind carefully while weighting it with external knowledge.

Impulsiveness is something different. Impulsiveness is taking some action for excitement or reward which is then later recognized to be an impulsive action. Most importantly, impulsive action seems to be "short circuited" action where the full executive/conscious decision making isn't activated. Intuition is often a type of super conscious process or mostly nonverbal which allows for "wider band" processing. The commonality is that linguistic/verbal/executive control is not dominant in either mode.

To reduce impulsiveness, I recommend a few techniques. First, make it a conscious decision to trade for money and not for excitement. Second, if you make an impulsive trade then you must timeout for some period of time (from say hour to days). Third, slow down your trading. Impulsiveness is closely associated with the idea of limitation: i.e. you think you see a deal and act without thinking because you didn't have time to think. A start is to recognize that there are always going to be more trades/deals/etc and that no matter how good a trade looks that it can always go wrong.

For enhancing intuition, it helps to do a sort of flight check before trading: observing your internal mental state. This should be paired with some objective types of risk controls such as daily loss limit, # contracts, etc.

What is important is that intuition is reflective and learning.. if I take a trade off due to a consideration of intuition then i will watch to see what happens. Was it a good exit or not? It must be considered and factored into the equation also all the possible paths that could have happened. In general, fear or greed based decisions will work less well then when one is acting based on impartial market read.

One other thing you might try is to broaden your trading times, i.e. allow yourself to trade more "sessions" such as before the open to reduce stress of having to trade the open. If you're waiting for the markets to open then you're creating a situation where you need to perform. While much of expert trading is probably intuition, it is likely going to be worthwhile, as well, to make it a goal to make/expand the conscious decision making, to become more and more conscious of the assumptions one is using to make decisions and then to scrutinize those assumptions.




thoth trader0204 View Post
Hello, Everyone!
I am a new trader and I would like some input or techniques in how to distinguish impulse from intuition. I feel that my impulsive nature is completely holding me back from making consistent profit. I find that I am most impulsive when the market opens and as the day progresses forwards the impulsiveness dies down and reasoning takes over. I also know that I am most impulsive at that time because I'm both nervous and over anxious as its the beginning of the day. What can I do to subdue the impulsive tenancies? What distinguishes impulse from intuition?



Last edited by tpredictor; January 7th, 2018 at 07:59 AM.
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