Mark Douglas 7/7 Retrain Your Brain

[Music] is it possible to draw anything energy out of a belief so that it doesn't have any impact on the way we see the world and how we behave we might not know the underlying energy dynamics of how it happens but we can we definitely know that it has to happen because we there's anybody in this room that is operating under the same beliefs and principles they operated out of as a child then I mean in other words there's a lot of principles and things that we knew or thought we knew or believed as a child that we don't want we no longer believe because they're no longer useful whatever those beliefs are whether we remember them or not if we can do an inventory of all the things that we learn to believe at some point in our lives we will find that a lot of those beliefs just the energy was inadvertently drawn out of them if the energy was not drawn out of them and we've learned something new that counter dixit it's what i'm going to call an active counter diction and many of us all of us actually can have a number of one eight likes to refer to as an active counter diction for an example in trading in his own I give this you know about the boy in the dog the example of the very first experience the child has with the dog it's very painful he's mauled pretty severely and as a result every subsidiary dog that he encounters you know in throughout his childhood regardless of how friendly the dog is regardless of the potential fund that the child can have with playing with dogs his perception of what dogs are is that they are mean and dangerous at some point in his child's life he will most likely this is hypothetical but most likely develop a belief a series of words that that he's going to put together that have meaning in the sense that they're energized as a living concept that all dogs are dangerous okay this is a belief all is an example of a belief it's exist an example of a set of words that we pulled together into a concept that becomes a life principle that has energy and that energy that's inside of him will cause him to see the world in a way that is completely consistent with these words so that every dog he encounters he will perceive as being dangerous and avoid regardless of what the potential is regardless of what the alternatives are it won't matter this is something that can really frustrate parents because they could bring home the friendliest most playful dog imaginable and it won't make a difference and if prince will get frustrated because they think that you know somehow or another the energy of their words is going to counteract the energy of this terror because that's exactly what the child experiences every time a dog comes into his field of awareness and this can this can go on like this for the rest of his life at some point he will most likely become exposed to a friendly dog situation now I set up a hypothetical situation in the book where where he's just you know walking with his parents he feels safe and in new they walk around the corner that you know he can't see what's going on and all of a sudden he's confronted with a information that is completely contradictory to what he believes is true this is an absolute truth to him it's not true from the environments perspective from the environments perspective dogs have a range of behavior there they're fun they're friendly and fun and some can be mean and dangerous and everything in between he walks around this corner with his parents and all of a sudden he's confronted with a scene where several analysts say kids his age and it's important that the kids his age part become as a part of this dynamic because he's going to relate to them and he sees these kids playing with dogs and just having a great time they're laughing and they're running and they're and everyone's having fun this is completely contradictory to what he believes to be true good were you gonna say something and we're gonna say something okay then to what he believes to be true this is now setting up the dynamics of what I'm gonna call an active counter diction he has an awareness he has an awareness that even though he might not relate to it in terms of the actual words oh I believe well dogs are dangerous and he might say it that way I mean you just might you know have this concept and embedded in his brain with these words but that but that it what what's happening is that his awareness that all dogs are not all dangerous because he has a personal direct experience to see that they're not will start to chip away at energy not enough for him to go approach a dog not enough for him to play with the dog but at least it'll chip away and it a little bit now here's the important part of this and this is the key element to any kind of personal transformation it depends on what his intent and desire is now if this kid for whatever reason he's relating to these other kids so much and he and he's gets so attracted to the fun that they're having she says to himself I would like to be like these kids I would like to be able to play with the dog not everyone's gonna have that now he was gonna have that attraction but in this case let's say this individual looks at this scene and says you know what they're having a lot of fun and he's thinking I want to be like that does that automatically mean he's gonna be a play with dogs no no this fear is just way too intense so he's gonna have to set up a process you might say okay set up a process like small incremental steps to be able to get to the point where you can actually interact in close proximity with the dog and just real quickly just just how the fear fear you know attracts the object you know that the object of our cause the focus on abdicated space you're trying to avoid like like this kid was let's say so afraid of dogs that he could even be walking out in onto his front porch because some kids his friends were in you know in the park across the street or possibly the neighbor's kid's house and they're playing he could hear the dogs mark down the street which under normal circumstances he probably wouldn't be aware of and hearing the dog bark that caused him to go back in laps he created the experience he wants to avoid dogs he heard of dog that the ordinary wouldn't be aware of creating experience of terror and walk back in laughs so so how does he get through this fear to be able to express himself how does he transcend his fear to be able to express himself in a way that he can play with dogs it'll probably happen in slow incremental steps in other words now every time he encounters a dog he will be seeing the dogs from a different perspective because he's already seen that it's possible to have fun he just can't do it yet and so every time he has a dog comes into his field of awareness and it turns out to be a friendly dog and nothing negative happens he'll start building up positive energy into a new belief system that dogs can be friendly and fun dogs say dogs can be friendly and fun that imply some alien fun to counter decree beliefs every time he has a positive experience he starts adding positive energy to this belief to this concept and he's drawing energy out of this one little by little incremental step by incremental step eventually if he does this long enough or happens enough times eventually you know they'll reach a threshold point a threshold point in which the negative energy in this belief is probably equal to or close to the positive energy of this belief and at that point he might have enough desire to cross the threshold into actually petting a dog into actually touching a dog for the second let's say for the first time in his life rather than the first one he got mauled which you know look like petting a dog and the point at which he actually has physical contact pets a dog without it being a negative experience it'll start drawing tons of energy out of this one right here because then he knows for sure it's not sure all dogs are not dangerous see all it's the all part it's not true so it's not like the belief itself disappears do I still believe in Santa Claus yeah it's it's a part of my it's a part of my identity it did it didn't disappear what's a belief exists we're gonna have it our entire existence once we formulate a belief what we'll have it it's just a matter of how much energy is inside of it that you can draw so much energy out of a belief that for all intents and purposes it might it'll not exist because it has no potential to act on how we see the world and how we behave so the whole time that he's going through this process of drawing energy out of this and putting energy into this he was operating out of what I call an active counter addiction there's just like as traders we have an active counter diction most people believe that because they're traitors they're risk takers when all their beliefs are lined up in a way that's complete completely counter niks what they think they believe the idea that we're risk takers is an illusion that's just something we I'm afraid I'm a list ain't one vomit really must be a risk taker and yet if I analyze everything I do and how I think it would definitely indicate that no I'm not taking any risks at all otherwise I wouldn't be doing it just like people who play slot machines if if there was the same kind of emotional risk playing a slot machine as there as there are as there is with people who trade do you think that tens of millions of people around the world we playing slot machines every day come on do you think they would or not absolutely not they're losing and they're having fun but because we're really not losing you look at it that way they're paying for their entertainment they're paying for their entertainment they're paying to be surprised and it's all like they're not losers they're paying to have fun as traders we have to pay expenses we have overhead expenses this has nothing to do with losing get that firmly and brained at the core of your personality and you'll be free so I friend over here says the truth stuff set you free in the will are we getting the concept here now this is this kid that he's going through this process does he have to have some sort of a comprehensive understanding of the dynamics as I've outlined them to you know he just has to have what the desire the key the transformation is desire and clarity clarity first and desire you have to know exactly who you want to transform yourself into and why our beliefs well you know beliefs you just don't you know they can go y'all you can draw the energy out of a belief instantaneously if there's enough desire however you have to be real clear about what it is it that you know you have the desire of it can happen instantaneously with intense desire clarity and intense desire it's like that two degree to it you don't have clarity and desire it will take time and so I'm giving you a technique that takes time there isn't anybody in this room that hasn't had a situation or experience in their life I'm assuming there isn't I really doubt that there is there's anybody in this room who hasn't had the experience of making up their mind and things changed instantaneously genuinely making up your mind that's an essence exactly what I'm talking about when you really make up your mind with a resolute desire with no conflict about what it is that you're making up your mind about things change now anybody want to contradict that you're gonna argue with that with me you can no I'm serious if you're doing are you all only games and argument [Music] am I talking about anything different here with with you know this exercise I'm about to give you if you want to if you want to instill these concepts that I gave you earlier as trading principles you'll do it you'll find a way to do it if you don't you won't and that's that simple if you can make the connection you can make a clear distinction between these principles that I gave you and the kind of outcomes you want to experience in the trader you will do it if your desire is to be a consistently successful trader if your desire is to get out of boom and bust cycle in the frustration but keep in mind not everybody wants to be out of the boom-and-bust not everybody wants to be out of the frustration there's other agendas that can be you know another video would be inserting themselves I have an option straighter than the option spin year years ago then I worked with I mean this guy had John talks a lot here complex I mean this guy had a real hero complex he'd set up the most convoluted option strategies that were just so unbelievable and yet and he did it for the express purpose of just going through the process of being the hero of unwinding it in a way where you know he you managed to make everything alright in other words at some point and he's and when he'd set these things up it looked like it was gonna be disaster and then he find a way to work his way out of that you know and and that's what he enjoyed he enjoyed the complexity of it didn't help his equity curve much but that was us tell us that was a secondary agenda okay it wasn't his primary agenda so you want to instill these beliefs here's why you can do it the first thing you're gonna need is a truly mechanical system and what I mean by mechanical I mean absolutely strictly mechanical no judgmental wiggle room whatsoever every entry and exit is absolutely precise the market either conforms to the criteria of your edge or it doesn't and there's nothing to decide it's either it's either there or it's not meaning that my entry our precise that you don't have to make a judgment well this is this you know just really an entry do I have you know the mood I have this and this miss to consider there's nothing to consider this could be a pattern recognition system it can be a mathematically based system it doesn't matter as long as this long as your entry way you enter the market either long or short is absolutely based on precise rules that you don't have to make any judgment about where you put your stop or trade it for a train that doesn't work has to be absolutely precise and in the same place every time in other words based on based on the you know based on your entry rules there will be a most optimum place to put a stop that says that you know there isn't much point in staying in this train once the market gets this far against my original position that does not change over the twenty trade sample size because you're going to trade in sample sizes you're going to be doing this in a twenty or twenty five trade sample size so where do you put your stop has to be absolutely precise and consistent meaning in the same place every time in the same place in relationship your entry every time not the same place on the chart every time obviously pop an objective same rule precise no judgment now how you gonna find this system you can develop it you can buy it you you know get it out of a chat room you know I'm not saying that this is necessarily an easy exercise easy in the sense that finding a completely mechanical system where you you know that that has I mean they exist I really do I mean you know one of the things what my new book comes out one of the one of the next projects going to be to make available a number of absolutely mechanical systems that fit the criteria of this exercise that people can choose to use to do the exercise so in a number of different time frames and in different styles of trading and they've already got one I mean I got one of the entries are really good I just haven't haven't made the XS precise in terms of stops and profits so I am working on is that gonna be in the book no that'll be Webb boy web-based yeah yeah yeah yeah yeah the book yeah because yeah because it's like you know it's like there's no point in making these concepts available to people unless you're gonna you know also help them with the system itself I mean normally with this work 15 years ago on a said you know what you know figure out a way in audience like yeah you know he trade good the business for 30-some years you think that you know it's like you don't have to do everything you but yet I realize now that you know it's you I'm really gonna have to provide it or give or give at least people a way to find it so it's just you know because the reason why it can be difficult it can not everybody is in is enough that say has the personality makeup to be able to develop their own mechanical systems it's just that simple so oh yeah I'm gonna I'm definitely gonna make the mix and not only that not just me but I will also you know investigate other people who have already developed systems and you know take the best ones and endorse you know I'll just say hey you know go here go here go here so that you have this available be so that you can get right into it so you don't have to worry about even developing it yourself that you can just step right into the process of being able to do this exercise so the next part of the exercise is is to test in other words which what the only reason gonna have these variables is they're gonna be tested you have to get the back test or over test so for example if you have back testing capability and you're proficient at it then you can go ahead and back test if you don't have that testing capability and you're not proficient at it then you have to forward test so what like me but forward test is you forward test in a simulated account meaning you want to find out what what the results are gonna be over and I believe it or not you're gonna forward test I don't think you really have to pull it just beyond 50 traits all you need is about 50 occurrences of your edge to determine whether or not it's viable he'll need to go beyond 50 so even if somebody is offering you a completely mechanical edge that you can buy in a chatroom or otherwise if they'll give you at least you know at the very minimum 25 but they'll be generous enough to give you a 50 trade sample that that would tell you whether or not you even want to get into you guys with me on this so you test your edge and you find out what the results are it's that simple it's like how many winning trades how many losing trades and what your what your your profit and loss ratio is because there are some edges you know that you can have they might only win 35 to 40% of the time but you know their profits a loss ratio is so good that you're gonna end up in that winner and there are edges where you're gonna win ninety percent of the time but your profit the loss ratio meaning you have to list a lot to make a little where you might be let's say in the ESPYs you and I'm speaking of a one particular in specific and even then I know how where you know they're their risk and 8 to 9 SP points to only make two or three but the winning 90% of the time now this like Z you know this is a lot of people wouldn't like that no that would be alright don't choose that edge the important thing is that you get once once you decide that once you've found something that you think is that you believe is Bible based on your testing then you're going to step into a process of actually executing the edge now how you step into this process is a lot to do with with your own as a in a you know risk taking ability meaning that there's a lot of people who are trading who are not natural-born risk takers there there I I believe that there are genetically people who are genetically predisposed to take more risk than others and the ones that are predisposed to take more risk generally will make better traders or easier them to be better traders as long as they can control themselves if they can't control themselves they're they're gonna be the worst in terms of their swings enough about but otherwise I also you know have worked with people who are so risk averse that they can't even execute a mechanical system in a simulated account where there's nothing at risk and actually do what they need to do they can't do it they literally can't do it not even where there's nothing there's no money no money at stake there's nothing at stake and they still can't follow the rules and if that's the case then you know it's going to be challenging okay if it's that simple it's going to be challenging and so here's what you do it's like if you can't do it with money I mean if you can't do it in a simulated account because you really should do it the simulator if you can do that's what it does well here's the rule the rule is that once you decide on the edge trade at least one sample size in the simulated account if you can execute that edge perfectly and what do I mean by perfectly you take every signal as it's given without making any errors it's that simple you you you your entries are without error and your exits on the profit and on the law side are without their knowledge you can do exactly what you need to do when you need to do it the only thing that's going to stop you from doing exactly what you need to do and when you need to do it our contradictory beliefs or beliefs that would contradict what it means to think in probabilities if you don't have any beliefs or any beliefs that have energy that countered it with the set of beliefs that I gave you earlier then you will be able to do this perfectly and I would say the likelihood of that is probably zero and so you ex acute in a simulated account until you can do it perfectly now why are we doing this this important because you gotta think you know what I'm gonna take time away from training to do you know yeah yeah you're doing this to develop the necessary belief skills that you need to be a successful trader you aren't gonna be inadvertently well not even inadvertently consciously drawing energy out of any conflicting beliefs and you don't have to know what they are you do not have to identify them you do not have to go into some sort of personal inventory of your beliefs you don't have to do that you just have to be committed to do the exercise and it'll happen automatically every time you do what you need to do when you to do it in spite of the fact that it there everything aside of you screaming something different don't do this and you step through it and do it anyway you will be drawing energy out of whatever conflicting beliefs we're saying not to do it or to do it in a different way and adding energy to your new beliefs about probabilities are you with me on this in other words step you know as best you can with with as much desire as you can generate step through the resistance and just do the best you can and keep on doing it until the resistance goes away because it will the example there's an example in just and I didn't elaborate on this example in the discipline Schrager but it was a guy I worked with he owned a couple construction this is back in the late 80s he under constructed a couple construction companies in Dallas he was in his you know mid to late 50s at the time a real kind of a bluff construction guy right you know he owned two construction companies and but you started trading bonds away from the floor getting is just getting his ass kicked and so he said he's got to come to Chicago and and and be in the bond pit he's gonna be a bond trader to policy and and he you know he's trading on the floor in the bond pit and still getting his ass kicked and somehow I don't be read the disciplined trader somehow he ended up calling me and I started working with them and you know one of the things that we became apparent immediately is that he had no concept of but how do identify an edge and so at the time what I did was is I taught him how to how to identify intraday support resistance in in the bonds of using point figure charts and so we did that for a couple of weeks and you know he went down to the pit and you know and any hand is you know and it just so happened that well any-any had a support resistance and found that he couldn't he couldn't execute I mean just it could not do it literally just couldn't do it and that you know of course that really bothered him a lot because this kind of guy that you know he tells do so tell someone to do something specs and do it no mistakes right you know so anyway no mistakes and so what I did is I set the sector size up form and the exercise now this guy's a multimillionaire okay and this exercise was really simple and all he had to do was you know we had we had supported the find got a particular price intraday we had resistance about seven or eight ticks up from support you know whatever it just so happened the first day that he had to do the exercise the market opened up in between these two support resistance levels now little hold the exercise was that if the if the price is the max price came down to his support price all he had to do is buy one contract one contract in the bonds where we're you know one incremental tick was worth thirty one dollars and twenty-five cents and all he had to do was risk three ticks in other words he's gonna risk less than a hundred dollars to see if this trade is gonna work and if he didn't get stopped out then if the market went up to resistance he had to get out of the trade and reverse his position and risk three ticks in essence if the whatever the market did first is what he was supposed to do but any case all he had news risk a hundred bucks this guy's got a guy he'd take a hundred Allah built let's start with it seriously he couldn't do it could not follow the rules the market started coming down and he gets so panicked got so panicked that that it wasn't the market you know that that he got so panic that that the market wouldn't go down to his entry point that he got in two ticks early and then when the market went up one tick to what he got out with a one tick profit okay what the Warka deal of course come went down hit his price went went up and rallied rallied up to you know seven eight ticks up to his up to this price here and he did the exact same thing he got in two or three ticks early when the market was taken his favorite he blew out of the trade yeah and so and so you know the next day you know he didn't really necessarily want to be talking to me after not being able to you know he was embarrassed and you know that kind of thing next day he does the same thing so I didn't hear from him for quite a while and then about Oh two or three weeks later he finally called and and what had been happening is that he got really good and identifying these support resistant levels these intraday support resistance and and he was actually making money but he was still only hanging on for one tick in other words he he he he was only hanging on for you know every time just just big profit one tick profit and and so he was calling to tell me that he's instead of learning how to hang on to his winning trades he was going to compensate by upping his size so instead of being a one lock trainer in the mantra pit pit he's gonna be like he's gonna up the size the twenty five or thirty Lots okay now the problem was doing that in the training in the pit is that you're training with a whole different group of guys one lot traders are gonna be training with other one lot traders and some deck holders but when you get to these upper levels you're gonna be training with other other guys and they don't know you they don't like you they can make like real hard for you and I'm not gonna give him the dynamics of the pitch but it's not like you know what people think but in any case it's they don't even exist anymore effectively but in any case so he um he called back at the end and I and I and I said to him you know he didn't he he didn't ask me for my advice I did it was unsolicited but I say you know his name was Jerry and I said Jerry you know this I really think there's a guy he's sort of grunted and hung up on me he called back he called back at the end of the day and and he was in such a state of distress he not only had he lost all his money that he made from the other previous two and a half weeks I suspected that he lost something's considering the level of distress that he's lost a lot more and so it was so much he lost so much that he was at that genuinely at that point where you saying I'll do anything and he meant it he was so frustrated that he said I'll do anything and he really meant it and I said Jerry if that's the case then here's what you got to do I want you to do exactly what you're supposed to do with one lot and when you enter you get you only need to hit support resistance what I want you to do once you're in the trade I want you to actually put your hands in your pocket and watch the clock and the market either hits your objective or you have to stay in the trade for ten minutes whatever happens first in other words I want you to put your hand because in towards Bork their hands I want you to put your hands in your pocket and actually watch the clock meaning I wanted him to be with his discomfort because as he watched those seconds tick by as he would watch those seconds tick by those seconds would be like days and weeks damn he wanted to get out of those trades those he wanted to take his profits so bad because he believed that you know even though he could see he had and perfect it just had indisputable evidence that that that that the market would would rotate back to his you know support resistance points that his his feared of the market taking his money away was so intense that you know he couldn't stay in that beyond that one tick so I wanted to put his hands in his pocket watch the clock and stay with the discomfort and after the first day he didn't think he did very well but I thought he did great because he did he did manage you know to stay in the trade for three or four minutes you can see that each minute no you can see that each minute was like an hour or two to him that was a big deal it's like it wasn't really three it wasn't three minutes in real time in his mind it was it was a couple hours okay really and so but the thing is he did do it and it was amazing how fast his fears dissipated to the point where he kept on doing any good and there's a little so his positive self-talk nothing I told him what to say to himself while he's watching the clock Dillard said that Bert his diverting his negative thoughts and and and consciously think positive thoughts about you know he knows why he's doing this and it's gonna be alright he's gonna learn how to take his profits and they'll etc etc okay and you know it wasn't really I don't think I don't know exactly how long it took me about a week or so on you he was fine he was done he don't have to be a really really good trader not in the pit by the way he left the pit just became an awful floor swing trader but he turned out to be a really good trader drawing energy he didn't I actually I've never had the kind of in-depth discussions with Gary well I could actually identify and put into words exactly what beliefs he was operating out of that caused him so much fear I you know I didn't I didn't ended need to but yeah of all I'm saying that I didn't you know he never really he never really opened up to me in that way where I could say I knew exactly I could put words on whatever beliefs he was operating on him but it didn't matter I didn't have to but he didn't have to know either all he had to all he had to know is who he wanted to be he wanted to be someone who could hang on to his winning trades and he accomplished that by stepping through this fear and staying with the discomfort long enough to do that knowing exactly why he was doing it and so you want to instill these beliefs you're gonna do the same thing all you're gonna do is you're gonna do this exercise until you can fall asleep now if you can do it flawlessly in a simulated account then you're gonna step into a live account now how big of a live account are you going to step into meaning how what's your size gonna be I would say you keep your size everyone's gonna be different but you keep your size at a level where it is virtually meaningless meaningless when it was a simulated account it was definitely meaningless now you've got real money on the line and so if you're thinking let's say you have to tap into a really good mechanical system and you're thinking you know what you know I do hey I did didn't I yeah I did my testing and I did my simulated okay now you know I'm gonna trade thousand shares of whatever okay and you know you're not yeah you know and what you don't know yet is that this because you did it flawlessly in a simulated account it doesn't mean that you reconciled whatever money issues you might have when you go to a real account okay so I would say for some people and and there are people that I work with or some people there risk issues were so great that we had they couldn't even trade one mini S&P they had to go down to one share of stock one share of stock because what we're doing here is this is that if we're working in a 20 trade sample size if I'm saying you know what I'm not just gonna take the next trade I'm taking the next 25 see that's what I'm saying I'm not taking the next trade I'm committing myself to take the next 25 trains no matter what no matter what that means that in essence what that implies well new twenty others two twenty one two three four five six seven first of all I don't have any idea what the sequence the wins and losses are going to be I have absolutely no idea what the distribution or sequence the wins and losses are gonna be in the next twenty trades but what I'm saying is that I'm taking the next 20 no matter what I know exactly how much I have to risk to take all 20 trades I define my risk parameters for all 20 tres because it's exactly the same so whatever that aggregate amount is if you added up all 20 trains if I'm trading one share of stock for example and my my edge dictates that I have to then I have to risk $2 let's say I'm trading a $50 in stock and I have to twist $2 to find out if my edge is gonna work then aggregate what am i risking on this on this exercise what 2.2 times 20 is 40 bucks yeah 40 bucks 4 plus Commission's do we handle that you think so you'd be surprised you might not be able to so in other words what you're saying is that I am willing to spend $40 to see what's going to happen with the next 20 trades now if you if you could if you your risk tolerance is greater and you can you know trade espy's or trade the Dow or trade the bonds or whatever whatever that risk amount is added up on an aggregate basis and and assume that if I had to take 20 losses in a row I'm willing to spend that money this is really important if I no chances of you losing 20 trades in a row is about as great as winning 20 trades in a row so in essence it most likely is not going to happen but at least you are ready to spend the money if it does it's really important that you make that commitment and once you can trade whatever level you're trading at in terms of position size flawlessly up your size and until you can trade that position size flawlessly up your size again and how do you know if you've gone too far you start making mistakes you start getting conflicting thoughts you start getting internal arguments so then you scale back how do you know when you are ready if you so choose to transition into the subjective or discretionary mode of trading well you don't have to follow specific rules how do you how would you know when you're ready to do that when would you get yeah well you can trade at a position size that you normally would want to trade at that your account that your money management principles would dictate and you can trade at least two sample sizes flawlessly two in a row flawlessly and what do I mean by flawlessly I don't mean that you're just executing flawlessly I mean that it doesn't occur to you to do what you're not supposed to do the thoughts don't even enter your brain anymore I'm really serious about this by the way that the thoughts of doing something other than what your rules call for done it doesn't even occur to you because you because you've been grained these principles into your identity and such a core level that distracting thoughts just they don't even come anymore or if they do they're so irrelevant that you just completely just immediately dismiss them and when you aren't having problems in experiencing resistance as you're going through the exercise what are you gonna do focus on the beliefs that I just gave you the ones you wrote down these are the beliefs that you're energizing these are the words that you're making real inside your mental environment so that you experience the world in a way that corresponds with these beliefs this making sense they're right is it important to do these over a shorter conferring like intraday trades poses something might set up once you do let's put it this Maidan it depends on how fast you want to get through it on monthly charts you know it's like and it takes you two years and two years to get 23 that's your preference okay remember this is an exercise okay this is an exercise to instill beliefs that I'm categorizing as skills these beliefs that I gave you they are actually fall into the category of a training skill no different than being able to recognize patterns in the market that's a skill these are the psychological skills that correspond with being able to recognize those patterns in the market any other questions this is more of a comment but when you said these are psychological skills since 95 percent of trading is a psychological endeavor just may be the only way to exercise those skills be it just made the connection that because this is such a psychological endeavor these are the skills you need to train you need to learn them and gene them if you want to be consistent yeah you want to create consistent results well it does it none of these skills are necessary if you use a long experience winning traits none of these skills are necessary if you just want to experience winning trades they are absolutely necessary if you want it consistently rising equity curve where the where the draw downs are simply a reflection of trades that didn't work edges that didn't work as opposed to psychologically generated draw downs as a result of mistakes see what this exercise does is it instills in you a sense of trust that you will be able to do what you need to do when you need to do it act in your own best interests without having to experience pain first pain is not is not having to experience pain to do the right thing is not a good way to trade a [Music] little back your first friend I think you sort of answered my question in the last two sentences but you know one of the things you mentioned earlier was you've got to know or have an idea of what kind of a trader you want to be and I was just wondering if you could talk about you know how do you get there but I think you know you talked about how once you've gone through this exercise of you know these twenty five trades or whatever however many you know you build confidence in your ability to execute those trades the way your system is supposed to give you the signals etc so I think and at the end of that exercise you are much more confident about you know your ability to execute those trades correctly and and also that you will not pull the trigger at the wrong time out of some other hidden hidden agenda that you may have keep in mind something this is this is difficult - this is difficult to convey but it's hard to know what decisions you're gonna make more what kind of trainer you're gonna be when you're on the other side of this see if you're asking me you know how should I decide what kind of trainer I'm gonna be I can't answer that question you guys it'll be whatever you know whatever resonates with you but yeah it's hard to know even at this point what that might be because you're gonna be a different person you're gonna be seeing and responding in different ways and and you know it's hard to know what might you might be attracted to and what might resonate with you once all spirits are gone that make sense someone happen okay so in this system this mechanical system is it fair to set stop losses and automatic trades to hinder an exit or do you have to do it yourself you mean me do it completely automated yeah completely in for your next no no no I'm gonna help you to automate it just do it yourself because you want to you want to experience what you're going to experience when you have to do it yes right is it it's either/or there's no absolutely no judgment no thinking wiggle room you shouldn't even be thinking thinking is a trading error all the thinking was done when you did your testing and decided on what what you know criteria defines your edge once once that's in place no thinking aloud there's nothing to think about just do it yeah usually oh this should all be in the same market you can sit yeah you can see yeah the question was you should be in the same market yes whatever edge you're using if you're gonna set up multiple exercises and multiple markets for whatever reason if you wanna do it that way do it but just keep it consistent that edge as it applies to that market and time frame absolute Thank You Ann time play right anything else okay let's go have lunch

Channel: Eddie L

Views: 57,021

Rating: 4.9385667 out of 5

Keywords: Mark Douglas, trading, finance, psychology, markets, webinar, seminar

Id: bNI3-Vjfbv0

Length: 44min 14sec (2654 seconds)

Published: Mon Apr 23 2018