Morning Scriptures

My Objective:

To be a consistent trader

Beliefs:

  1. You don’t need to know what’s going to happen next to make a profit
  2. Anything can happen
  3. Each trade is a unique statistically independent edge from any past trade. Being scared to take on the next trade because your last trade was a loser is irrational
  4. Each trade will either work or it won’t – you then wait for the next edge to take a trade again
  5. A trader’s job is to identify patterns in market behavior that represent an opportunity and then to determine the risk of finding out if these patterns will play themselves out as they have in the past
  6. The most important component in a traders ability to accumulate money over time is having confidence in his own consistency
  7. There is a huge psychological gap between assuming you are a risk taker because you put on trades and fully accepting the risk you are taking with each trade(When you fully accept the risk you will benefit your bottom line – they can get out of the trade at a loss without any discomfort – losses doesn’t cause fear, lack of discipline, focus and confidence
  8. The best traders stay in the flow because they don’t try to take anything from the market. They make themselves available to take what the market is offering
  9. The market doesn’t generate positively or negatively charged info. The only positive or negative info comes from your mind.
  10. I have to believe so deeply in the uncertainty of market outcomes that I dissociate with my latest trade as each trade is unique

The 4 fears:

Most losses will come from your attitude about being wrong, losing money, missing out and leaving money on the table (4 primary trading fears)

The 5 market truths:

Truth 1: The market can do anything at any time. It can express itself in infinite ways

   From our own individual perspectives of the market anything can happen. It only takes 1 trader to bust through a resistance or support

Truth 2: You don’t need to know what is going to happen next in order to make money

Truth 3: There is a random distribution between wins and losses for any set of variables that define an edge

Truth 4: An edge is nothing more than an indication of a higher probability of one thing happening over another

Truth 5: Every moment in the market is unique

I am Consistent because:

  1. I objectively identify my edges (No potential to perceive any market information from a euphoric or painful perspective) 
  2. I predefine the risk of every trade
  3. I completely accept the risk of every trade
  4. I act on my edges without hesitation or reservation
  5. I pay myself as the market makes money available to me
  6. I continually monitor my susceptibility for making errors
  7. I understand the absolute necessity for this principles in order to achieve consistent success, therefore I never violate them

Visualizations:

  1. Losing Trade
  2. Winner that becomes a loser
  3. Winning trade