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Traders love patterns. We trade chart patterns, oscillator patterns,
historical patterns, cyclical patterns—you name the pattern, chances
are there’s someone trading it. Much of trading boils down to pattern
recognition and the ability to quickly identify and act upon
profitable patterns as they occur. This is particularly challenging
for active futures and options traders, who must read the patterns,
make their decisions, and place their orders within a matter of
seconds.
Processing market patterns in the midst of
our own emotional patterns—our tendencies toward impulsivity,
hesitation, frustration, and regret—is one of the greatest challenges
of active trading.
It is always sobering for traders to realize
that they are every bit as patterned as the markets they’re
trading—and sometimes far more so. In this article, I will draw upon
two decades of experience as a clinical psychologist to illustrate a
powerful technique for interrupting and changing repetitive emotional
and behavioral patterns that disrupt trading. The technique is a
cognitive-behavioral method known as exposure, and—in the Ranger
tradition described by Brace Barber, Linda Rashcke, and me in
September’s issue—it is a powerful tool for challenging oneself for
exemplary performance...
Download:
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