TRADING PSYCHOLOGY intelligent in the use of emotions.

Developing the Mind from Emotion

Notice that the mind you engage uncertainty with comes from an emotional base. Thinking or perception does not come BEFORE emotion. Thinking comes AFTER emotion is triggered from the intersection of primitive beliefs learned by the limbic brain as engages uncertainty.

it It is here that

the trader must unlearn what his emotional brain has hardwired about its capacity to manage uncertainty on a survival level and learn to train the emotional brain to engage uncertainty from an emotional base of discipline, courage, self-compassion, and impartiality. This is the emotional cocktail that leads to a mind that can successfully manage probability. It is not natural, but it can be developed. (This is not easy to do or there would be a plethora of successful traders.) can be learned though.

Te default emotional programming of the emotional brain is to trigger to the fight/f light response when uncertainty creates a sense of vulnerability. That is just a given. Your biology works that way. You experience this phenomenon every time you fear entering a trading, or, conversely, jump into a trade that is not a planned trade (impulse trading). One response is simply fear based while the other is aggression based. Both are rooted in

primitive limbic learnings leading to the fight/f light response. This is the adapted route for lightening quick responses to perceived danger in the environment (the markets).

First you have to interrupt the

default programming that leads to fight/f light – or nothing can change. Fortunately breathing and muscle tension are actually part of an emotion. When you alter your breathing and the amount of tension in your muscle groups, you change the course of

the emotion. Fear

and anger require stopped breath or shallow and fast breathing to be maintained. If you train yourself with diaphragmatic breathing as a response to uncertainty (relaxation response), you alter the thinking that comes out of the emotion.


Same with muscle tension. Muscle tension really is emotional arousal in action. You are experiencing your body preparing for fleeing or fighting. If you volitionally relax your muscles, you will interrupt the emotional arousal toward fight/ f light. By doing this, you can create a relaxation response to the stress caused by exposure to uncertainty and risk. It is a talent you will need to develop into a skill.

This is just first aid though. What an emotionally intelligent trader is doing is actually creating the mind (rather than reacting to circumstance) that engages uncertainty and risk. It is created by willfully

developing a new

Self-Mastery is the Missing Piece of the Puzzle

Emotional self-mastery gives the trader the edge in performance. If you have your trading act together, you already have a methodology that provides an edge in the management of probability. With emotional self- mastery, you bring the mind that has a psychological edge that drives your platform and trading strategy. This fills the hole in your trading strategy and completes the three legged stool of effective trading. Left brain logic and right brain emotion are now in partnership with one another. The hole has become an edge. It does require evolving the brain and mind you brought to trading and people (and traders) are typically resistant to change. Yet the potential is there if you are willing to face your fear of change and claim a new destiny.

Rande Howell Trader Psychologist My Traders State Of Mind FX TRADER MAGAZINE January - March 2019 51 limbic

FX learning in response to

uncertainty. Rather than holding on to the illusion that you can control outcome, the emotionally intelligent trader comes to accept that he controls the mind that he brings to the moment of performance.

That mind is

rooted in discipline, courage, self- compassion, and impartiality. This is the emotionally based mind that can manage uncertainty and risk effectively. It is controlling what it can control – its own self-mastery.

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