Trading Psychology | Why Our BRAIN Makes Recovering from Loss SO HARD
Published: 2024-11-15
Status:
Available
|
Analyzed
Published: 2024-11-15
Status:
Available
|
Analyzed
Predictions from this Video
Incorrect: 0
Prediction
Topic
Status
The speaker experienced a significant trading loss of over $25,000 in under 5 minutes.
"I took a trade where in one trade in about it was less than 5 minutes I was down over $25,000"
Pending
Beginner traders, after a large loss, often engage in 'emotion seeking actions' to alleviate negative feelings, which can lead to further mistakes.
"What I end up doing and this is very common for beginner Traders before you've sort of learned about this phenomenon is you engage in Emotion seeking actions."
Pending
Traders who have experienced large losses may attempt to recover quickly by increasing their share size significantly, abandoning their established trading strategy and trading based on emotion and impulse.
"most Traders are going to do is they're going to start thinking well all right I lost $25,000 so all I need to do is buy 25,000 shares of a stock and make $1 a share or maybe I could buy 50,000 shares of a stock and 50 cents a share is all I need and I'm telling you when you are in that mindset the rules of your strategy are out the window you are now trading based on impulse and emotion"
Pending
Seasoned traders can recognize when a significant loss leads to emotional compromise and can either stop trading or become extra vigilant to avoid impulsive decisions.
"a seasoned Trader is going to recognize that that type of loss can create emotional compromise where we're no longer able to think clearly and thus we're able to intervene before taking the emotion seeking actions or we at least recognize that we're at a we're very susceptible to falling into that type of behavior and that type of pattern and so we're on alert for it"
Pending
An emotional reaction to a loss leads to trading low-quality setups in an attempt to alleviate pain, resulting in decreased trading performance.
"then you've got the emotional reaction and then that leads into um the steps to alleviate the feeling the pain which is trading and what that means is you're trading low quality so you start trading low quality setups"
Pending
The speaker experienced a $28,401.81 drawdown over a two-day period.
"My biggest drawdown of the year it was a $28,40181 drawdown and it happened over the span of 2 days"
Pending
The speaker lost money on the first trade, recovered to a green status, but then continued trading and overstayed their welcome, leading to further losses.
"on day one I went into the red on my first trade all right so I got knocked down and I came back swinging hard and I got myself back into the green and you know what any day where you go from red to Green you got to be grateful because you've already had a warning flag a caution flag out you went red and you fortunately made your way back to green don't overstay your welcome but I did I overstayed my welcome"
Pending
A loss of $1,200 would have been negligible for the speaker, whose daily goal is $5,000, but they continued trading and incurred a larger loss.
"if I walked away right here I would have been down like 1,200 who cares Now for me my daily goal is 5,000 so to be down 1,200 in one day it's negligible"
Pending
The speaker's worst trading day occurred on their birthday.
"my biggest red day of my entire career you want to know what day that occurred on my birthday"
Pending
The speaker became emotionally compromised while trading on the anniversary of their father's death, which influenced their trading decisions.
"the anniversary of my father passing away you know I there's a lot of emotion in there so all a sudden I didn't even realize it but it kind of snuck up on me and I became emotionally compromised"
Pending
Once a trader experiences 'emotional hijack,' their emotions dictate their behavior, and the logical, strategic part of their mind becomes ineffective.
"once you cross this point of no return there's kind of no going back it's very hard once you've fallen into what we call emotional hijack you are you're literally hijacked by these emotions they are dictating your behavior and the logical part of your mind that has created this strategy it's gone"
Pending
After a $10,000 loss on day one, the speaker should have recognized their emotional susceptibility on day two but did not.
"day one for whatever reason I don't recall what it was this time but for whatever reason I got stubborn I took a unnecessary loss I went down $10,000 on day two I I should have known that I'd be coming in on day two already emotionally susceptible because of the previous day's loss"
Pending
The speaker experienced their worst trading day of the year, which was followed by an even larger loss the next day, although the circumstances differed.
"this was my worst day of the entire year Now I actually took a bigger loss yesterday which looks pretty similar but the story of yesterday is a little different"
Pending
The speaker's two-day drawdown resulted in a total loss of $28,401.81.
"by the end of this two-day drawdown I'm down rounding you know about I was rounding up on those two days but I'm I'm down $28,40181"
Pending
If the speaker reaches a $55,000 max loss and continues trading, there's an 80% chance they will double that loss to $110,000.
"when I hit my Max loss of minus $55,000 when I go down that much if I continue Trad I have an 80% chance of doubling the max loss and going down 10,000"
Pending
When a trader hits their maximum loss for the day, continuing to trade will likely result in even deeper losses.
"on a day like that when you're already at at you know Max loss what's going to happen is you're going to dig the loss deeper and deeper and deeper"
Pending
Resisting acceptance of a trading loss leads to 'revenge trading' in an attempt to recover losses, driven by emotional distress.
"when you're fighting current reality when you're fighting to accept the situation that you're in it will lead you to continue engaging in the emotion seeking behavior of Revenge trading where you're looking for anything to trade to recover those losses"
Pending
Similar to the Apollo 13 astronauts, traders facing a crisis should focus on a plan rather than succumbing to anger and frustration, as these emotions are unproductive.
"think about Apollo 13 remember that movie with Tom Hanks Apollo 13 they're up there in the in the space shuttle spacecraft whatever you call it and when they realized that they were running out of oxygen they could have been Furious they could have said I'm going to throw my water bottle bottle I'm going to break my clipboard I'm just going to be angry at everything what's that going to accomplish nothing"
Pending
Accepting a loss and creating a clear recovery plan significantly improves a trader's perspective and emotional state.
"once you accept the loss and you put the new plan into place whenever I'm sitting down after having a big loss and I'm like okay this is what I'm going to do these are my steps I'm going to do number one two three four five I always always feel better because now I have a plan now I've got a road map and it totally changes my perspective"
Pending
The speaker's worst trading day occurred on their birthday, and a previous significant red day happened on the anniversary of their father's death, highlighting the impact of emotional events on trading.
"my biggest red day of my entire career you want to know what day that occurred on my birthday my biggest red day prior to that you want to know what day that occurred on the anniversary of the day my father died"
Pending
Putting losses into perspective, such as acknowledging that it could be much worse, helps in coping with significant trading losses.
"I was like okay put it in perspective yes it's not fun that you just lost $28,000 in two days uh but it could always be worse you could be down $280,000 in two days"
Pending
Having a substantial year-to-date profit of $200,000 made it easier for the speaker to cope with a $28,000 drawdown.
"for me I already was up $200,000 on the year so that made it easier for me to cope with being down 28,000 off the top"
Pending
For beginner traders, their track record serves as their primary source of confidence and guidance, especially during trading slumps.
"as a beginner Trader your track record is the source of confidence it is your North Star when you're in a slump you're in the woods that's your North Star that's what you follow"
Pending
Traders without a profitable track record should use a simulator to build one, as it reinforces that consistent success comes from adhering to trading strategies.
"if you don't have a positive track record then you need to go back to the simulator because the track record is the reminder that when you follow the rules of your strategy success and consistency follows"
Pending
A recommendation is to trade in a simulator for at least 30 days to achieve profitability before trading live with small position sizes and aiming for 10-30 days of consistent profitability.
"you want to trade in the Sim you know 30 days 60 days 90 days however long it takes you to have basically a month of profitability and then you flip the switch and go live and you want to do that again with small size and see if you can get 10 days of profitability 14 days 30 days of profitability"
Pending
A strong track record serves as a reminder that trading success stems from discipline, not emotional reactions, gambling, or impulsive decisions.
"the track record is also reminder that success is not the result of emotional hijack it's not the result of gambling with your account it's not the result of making impulsive decisions it's the result of being disciplined"
Pending
Consistently making $200 per day ($1,000 per week, $52,000 per year) can lead to recovering all trading losses over time.
"if you can consistently make $200 a day consistently $200 a day it's a th000 a week 1,000 a week that's $52,000 a year if you could do that consistently you will make back everything you've put into this"
Pending
While a loss of confidence is common during a drawdown, it's detrimental because both confidence and competence are crucial for successful trading.
"loss of confidence during a drawdown is common ... but here's the problem with losing confidence comp confidence and competence are key"
Pending
When confidence and competence are lacking, traders become overly cautious, hesitate, and miss opportunities, leading to reduced potential profits.
"you want to be confident and competent you want to be the person who knows what you're doing and when you're competent and confident then the loss of confidence results in missed opportunities it results in not maximizing on opportunities that present themselves because you know you're kind of in the state of being really cautious you're risking too little you're you start hesitating you start second guessing yourself"
Pending
The speaker's rule is to not lose more in a single day than they can recover in that same day, and after a red day, they implement 'guard rails' to prevent consecutive losing days.
"I never want to lose more in one day than I can recover in one day and after a red day what do I have to do I have to immediately Implement guard rails to reduce the risk of back-to-back red days"
Pending
The speaker claims to have had no consecutive red trading days over the past 90 days.
"over the last 90 days you will see that I have no back-to-back red days"
Pending
The common phrase 'I don't know what I was thinking' after a bad trade indicates that emotional hijack has taken over, overriding logical reasoning.
"I don't know what I was thinking I I you know I this is actually very common you'll say I don't know what I was thinking that's because your logical brain was gone and it was emotional hijack that was in charge"
Pending
The immediate priority after experiencing significant losses is to stop trading to prevent further damage.
"stop the bleeding you've got to stop trading that's the first thing"
Pending
Assessing trading damage allows for gaining perspective, reviewing one's track record, and maintaining a 'glass half full' outlook despite losses.
"assess the damage and when we're assessing the damage that's when we get perspective we ask ourselves what's our track record how bad is this really can we can we kind of change our perspective on this so the glass is still half full even in spite of this loss"
Pending
The speaker's daily maximum loss is set to be equal to their daily profit goal, which is $5,000.
"my daily Max loss is the same as my daily goal my daily goal is $5,000 my daily Max loss is 5,000"
Pending
The speaker has been averaging $21,000 per day over the last 30 days.
"the last 30 days right now I've been averaging 21,000 a day"
Pending
A crucial step in recovery after a large loss is to immediately reduce trade size, often to one-quarter of the usual size, despite the difficulty of accepting this reduction.
"number one sizing down immediately this is really tough one for a lot of traders to accept including myself because if you size down suddenly that hope of you know all I need to make is a dollar a share with 25,000 shares well that's gone because you're not trading with 25,000 shares when you're sizing down you're trading with whatever is maybe a quarter of your regular size"
Pending
The speaker's successful streaks often conclude with a significant loss, as the market's hot conditions may have previously allowed for riskier trades with less discipline, which eventually leads to a correction.
"most of my hot streaks end with a big loss so I'll be on a really nice hot streak doing awesome and then boom a big loss and that big loss kind of marks the end of the hot streak because through this stretch I may have had trades that were pretty risky and I was pushing my luck on it but the market was so hot I just kept making money it it was like it was a more forgiving Market even if you weren't being as disciplined as you could have been and then it catches up to you"
Pending
On the second day after a major loss, the 'guard rails' include sizing down trades and focusing exclusively on high-quality stock setups where the trader has historically been most profitable.
"on day two guard rails number one we size down that's the first thing you've got to do you've got to size down number two you focus on a quality stocks that's going back to the basics of what your metrics tell you you do the best wherever you make the most money that's what you're focusing on for day two"
Pending
To rebuild confidence after a loss, it's essential to focus on trading setups with the highest probability of success to secure necessary wins.
"you've got to trade the setups that have the highest probability of working because you need the wins you need to restore your confidence right you need the win"
Pending
The downside of entering 'trader rehab' (a recovery phase) is potentially missing a big market move, but the upside is the crucial ability to reset emotionally and regain confidence and consistency.
"the downside of not doing it is well what if there's a big move and I miss it okay that would be disappointing you're in Trader rehab you missed the move but the upside benefit that's your only downside your upside is that you will be able to reset emotionally and get back to trading from a place of confidence and consistency"
Pending
Missing a single trade is insignificant because the market will consistently present future trading opportunities.
"you miss one trade who cares there's always going to be another trade around the corner"
Pending
The speaker's stock selection criteria includes stocks with five times higher volume than average, a 10% price increase, a price between $2-$20 (or $3-$20), and a float under 5 million shares.
"looking for stocks for me that have five times higher volume today than his average this means the stock is doing something exceptional higher volume than average why typically because there's news stock already has to be up 10% and it should be priced ideally between 2 and 20 or 3 and2 and a float of less than 5 million shares"
Pending
The quality of the stock itself is more crucial than the trading pattern; a perfect pattern on an uninteresting stock will not yield positive results.
"more important than pattern is the stock when you trade a perfect pattern but it's not a stock that nobody cares about it's not going to work"
Pending
Understanding and adapting the 'five pillars of stock selection' to different market conditions is paramount for successful trading.
"stock selection is number one understanding the five pillars of stock selection how they vary from Market to Market is critical"
Pending
During a trading recovery phase, all trades must meet high-quality setup criteria.
"every trade I'm going to take when I'm in my recovery has to be trades that meet a quality setup"
Pending
The stock SP had a relative volume ratio of 5.3 on the day of the recording.
"SP relative volume ratio today on this one is 5.3"
Pending
The stock AEN had an exceptionally high relative volume ratio of 11,000.
"aen relative volume ratio on aen is 11,000"
Pending
The stock AEN increased by 178% during the morning, reaching a high of 250%.
"aen is up right now 178% this morning it hit a high of 250%"
Pending
The stock SP experienced a gain of over 100% on the trading day.
"SP went up over 100% today"
Pending
A call to action for viewers to like the video and subscribe to the channel if they found the content interesting.
"if you found this episode interesting I hope you hit the thumbs up I hope you subscribe to the channel"
Pending
The market will always be available for trading; focus on building experience and intuition to discern when to be aggressive, when to ease off, and when to take a break.
"as I always tell you guys is look the Market's going to be here for you this is your time right now to build your experience and your own sense of educated intuition so you can get better at learning when to ease on the throttle when to get aggressive and when to cool off"
Pending
A disclaimer stating that trading is risky, the speaker's results are not typical, and advising viewers to proceed cautiously, manage risk, and remember the market will persist.
"trading is risky my results aren't typical so please take it slow manage your risk the market will be here for you"
Pending
Following a red day (or month), it is crucial to immediately implement 'guard rails' to minimize the risk of experiencing consecutive losing periods.
"after a red day or if it's for you maybe it's a red month or whatever it is immediately as soon as you become aware Implement these guard rails to reduce the risk of back-to-back red days"
Pending
Traders should be swift in reducing their trade size when market conditions become unfavorable ('cold') and develop a strong awareness of cautionary signals in the market.
"be quick to size down when it gets cold and learn to develop a keen awareness of caution Flags in the market"
Pending
During a recovery phase, the maximum trade size should be one-quarter of the usual full size, with a focus on securing small, consistent wins ('base hits') to build a cushion.
"Max size is one qu of full size Max size is one quarter full size focusing on base hits focusing on building cushion"
Pending
After approximately five trading days following a significant loss, during which small gains are made, the trader typically feels emotionally much better.
"once I've had about 5 days between me and the loss by that point usually I've made back a little bit of the loss and I'm feeling emotionally a thousand times better"
Pending
Sizing back up to larger trade sizes for recovery begins only after feeling emotionally stable and having recovered close to half of the previous drawdown.
"once you're truly feeling emotionally better and I've made back close to half of the loss then I start to size back up for the next leg higher"
Pending
On the day of the recording, the speaker focused on achieving small, consistent wins ('base hits') and successfully executed this strategy.
"today was a day where I came in looking for base hits and I locked up base hits"
Pending
For traders experiencing an extended drawdown, the primary focus should be on stopping further losses and implementing a trading plan for a slow and steady recovery.
"if you've gone through an extended draw down your number one Focus right now has to be stop the bleeding and put yourself into a trading plan where you can begin your recovery slow and steady"
Pending
Consistently achieving small wins ('base hits') and securing small green days over a period of 5-10 days will significantly improve a trader's emotional state and confidence.
"if you could start focusing on hitting base hits locking up you know small green days 5 days from now 10 days from now you're going to feel like a different person"
Pending
The risk of entering 'trader rehab' is missing a significant market move, but the benefit is the ability to emotionally reset and return to trading with renewed confidence and consistency.
"the downside of not doing it is well what if there's a big move and I miss it okay that would be disappointing you're in Trader rehab you missed the move but the upside benefit that's your only downside your upside is that you will be able to reset emotionally and get back to trading from a place of confidence and consistency"
Pending
The speaker experienced a significant drawdown after a period of months without one, and later admitted they didn't know why they made certain trading decisions at that time.
"when I was showing you that 28,000 drawdown from the beginning of the year that was one of the first big draw Downs I'd had in months and I don't I don't know what I was thinking"
Pending
Accepting the current reality of a trading loss is crucial; resisting this acceptance will lead to 'revenge trading' in an attempt to recoup losses.
"accepting current reality is critical when you're fighting current reality when you're fighting to accept the situation that you're in it will lead you to continue engaging in the emotion seeking behavior of Revenge trading where you're looking for anything to trade to recover those losses"
Pending
The speaker refused to accept their trading losses until the very end of the trading day at 4 PM, only giving up due to lack of time, indicating a poor approach to loss acceptance.
"I refuse to do that on this day right here right here right here right here and I finally did it right here but this was at the very end of the day this was probably 400 p.m. so I pushed it all the way to the end until I finally had to give up and it was really just because I was out of time which is not a good situation to be in"
Pending
Having a clear plan and roadmap after a significant trading loss provides a better feeling and changes the trader's perspective.
"I always always feel better because now I have a plan now I've got a road map and it totally changes my perspective"
Pending
By following a recovery plan after a trading loss, traders stop worsening their situation and start progressing towards recovery.
"you're not digging the whole deeper anymore you're now on your path to recovery"
Pending
Shifting from a scarcity mindset (due to loss) to an abundance mindset (focusing on gratitude) makes coping with trading losses much easier.
"when you experience loss we're immediately from this perspective of scarcity we've just lost something and if you can change that to a perspective of abundance that I have a lot I have a lot to be grateful for that is makes it so much easier to cope with the loss"
Pending
Traders without a proven profitable track record in a simulator should not be trading with real money.
"if you don't have a positive track record of profitability in a Sim what are you doing putting real money on the line you really have no business doing it"
Pending
In trading, consistent performance is necessary; failure to perform will lead to avoidable losses.
"you have to perform and if you're not able to perform what's going to happen you're going to take these unnecessary losses"
Pending
The speaker's rule is to limit daily losses to an amount that can be recovered within the same trading day.
"I never want to lose more in one day than I can recover in one day"
Pending
During recovery, the strategy involves starting with small sizes to achieve 'base hits' and build a cushion, then gradually increasing position size up to a quarter of the maximum.
"focusing on base hits focusing on building cushion so building cushion means each day when I'm trading I'm starting with small size I'm trying to make 20 cents a share with small size build a little bit of a cushion and then once I have the cushion I'll size up a little bit more up to my quarter size Max position"
Pending
After about five days of trading following a significant loss, with some recovery made, the trader typically experiences a substantial improvement in their emotional state.
"once I've had usually about five days once I've had about 5 days between me and the loss by that point usually I've made back a little bit of the loss and I'm feeling emotionally a thousand times better"
Pending
The speaker experienced a significant drawdown after a long period without one, admitting they were not thinking clearly at the time.
"when I was showing you that 28,000 drawdown from the beginning of the year that was one of the first big draw Downs I'd had in months and I don't I don't know what I was thinking"
Pending
A strategy to build confidence is to achieve a month of profitability in a simulator, then transition to live trading with small sizes for another 10-30 days of consistent profitability, not necessarily daily wins but overall a green outcome.
"you want to see this translate now again again you want to trade in the Sim you know 30 days 60 days 90 days however long it takes you to have basically a month of profitability and then you flip the switch and go live and you want to do that again with small size and see if you can get 10 days of profitability 14 days 30 days of profitability doesn't mean you're green every single day but it means you're consistently green more than your red"
Pending
A track record serves as a reminder that adhering to trading strategy rules leads to success and consistency.
"the track record is a reminder that when you follow the rules of your strategy success and consistency follows"
Pending
It's crucial to avoid multiple losses during a vulnerable period after a drawdown by going on the defensive and 'battening down the hatches,' even though it's not enjoyable.
"so the most important thing here is to avoid having a second or third loss when you're in this vulnerable position this is where you've got to be on the defense and I know it's not fun to be on the defense it's not fun to bat and down the hatches but this is what you have to do"
Pending
Trading involves fluctuations (ups and downs); recovery from a downswing cannot be forced but is achieved by adhering to trading rules.
"you've got ups and you've got downs and when you're in a down you can't force it you can't muscle your way back to the top you only get back to the top following the rules"
Pending
Reluctance to enter a 'trader rehab' phase after losses is often driven by the fear of missing out on potential market gains.
"if you're reluctant to check yourself into Trader rehab I'm telling you most likely it's the fear of missing out that is creating that resistance"
Pending
Implementing a 'trader rehab' plan and accepting current reality can lead to feeling like a different person with renewed clarity and confidence within five days.
"if you put yourself into Trader rehab if you accept current reality and you start today following this plan ... 5 days from now you're going to feel like a different person"
Pending
By detaching from the emotions of a drawdown and making even small incremental progress (e.g., $200 a day), a trader can feel positive and confident, regardless of the total amount still down.
"when you separate yourself from all the emotions of the draw down and you start having even just a little incremental progress that's when you feel like wow it doesn't matter that I'm technically still down $75,000 I'm making2 200 a day and if I can make 200 a day for the rest of this year for the rest of next year ... it's smooth sailing for me and I'm good"
Pending
The potential to recover trading losses exists within the market, but it is contingent upon the trader's discipline in following their strategy rules.
"all the profit to recover my losses is in the market but there's a hitch it'll only come if I have the discipline to follow the rules of my strategy"
Pending
The recovery strategy involves securing small wins ('base hits') to build a cushion before gradually increasing position size towards the quarter-max limit.
"focusing on base hits ... building cushion ... once I have the cushion I'll size up a little bit more up to my quarter size Max position"
Pending
After approximately five trading days following a loss, with some recovery achieved, the trader typically experiences a significant improvement in their emotional state.
"once I've had usually about five days once I've had about 5 days between me and the loss by that point usually I've made back a little bit of the loss and I'm feeling emotionally a thousand times better"
Pending
Sizing up trades again occurs only after the trader feels emotionally stable and has recovered nearly half of the previous loss.
"once I'm truly feeling emotionally better and I've made back close to half of the loss then I start to size back up for the next leg higher"
Pending
On the day of the recording, the speaker focused on securing small, consistent wins ('base hits') and successfully executed this strategy.
"so today was a day where I came in looking for base hits and I locked up base hits"
Pending
For traders experiencing an extended drawdown, the immediate priority is to stop further losses and implement a trading plan for a gradual recovery.
"if you've gone through an extended draw down your number one Focus right now has to be stop the bleeding and put yourself into a trading plan where you can begin your recovery slow and steady"
Pending
Consistently achieving small wins ('base hits') and securing small green days over a 5-10 day period can lead to a significant improvement in a trader's emotional state and confidence.
"if you could start focusing on hitting base hits locking up you know small green days 5 days from now 10 days from now you're going to feel like a different person"
Pending
The potential downside of entering a recovery phase ('trader rehab') is missing a significant market move, but the significant upside is the ability to emotionally reset and trade with renewed confidence and consistency.
"the downside of not doing it is well what if there's a big move and I miss it okay that would be disappointing you're in Trader rehab you missed the move but the upside benefit that's your only downside your upside is that you will be able to reset emotionally and get back to trading from a place of confidence and consistency"
Pending
Missing a single trade is inconsequential as the market will continuously offer new trading opportunities.
"you miss one trade who cares there's always going to be another trade around the corner"
Pending
The market will always be available for trading; this is an opportunity to build experience and intuition to know when to adjust trading intensity (ease off, get aggressive, or cool off).
"as I always tell you guys is look the Market's going to be here for you this is your time right now to build your experience and your own sense of educated intuition so you can get better at learning when to ease on the throttle when to get aggressive and when to cool off"
Pending
A disclaimer stating that trading is inherently risky, the speaker's results are not typical, and advising viewers to trade cautiously, manage risk, and recognize the market's endurance.
"trading is risky my results aren't typical so please take it slow manage your risk the market will be here for you"
Pending
After approximately five trading days following a significant loss, with some recovery achieved, the trader typically experiences a substantial improvement in their emotional state.
"once you've had about 5 days between me and the loss by that point usually I've made back a little bit of the loss and I'm feeling emotionally a thousand times better"
Pending
For traders experiencing an extended drawdown, the immediate priority is to stop further losses and implement a trading plan for a gradual recovery.
"if you've gone through an extended draw down your number one Focus right now has to be stop the bleeding and put yourself into a trading plan where you can begin your recovery slow and steady"
Pending
By detaching from the emotions of a drawdown and making even small incremental progress (e.g., $200 a day), a trader can feel positive and confident, regardless of the total amount still down.
"when you separate yourself from all the emotions of the draw down and you start having even just a little incremental progress that's when you feel like wow it doesn't matter that I'm technically still down $75,000 I'm making2 200 a day and if I can make 200 a day for the rest of this year for the rest of next year ... it's smooth sailing for me and I'm good"
Pending
Sizing up trades again occurs only after the trader feels emotionally stable and has recovered nearly half of the previous loss.
"once I'm truly feeling emotionally better and I've made back close to half of the loss then I start to size back up for the next leg higher"
Pending
On the second day after a major loss, the 'guard rails' include sizing down trades and focusing exclusively on high-quality stock setups where the trader has historically been most profitable.
"on day two guard rails number one we size down that's the first thing you've got to do you've got to size down number two you focus on a quality stocks that's going back to the basics of what your metrics tell you you do the best wherever you make the most money that's what you're focusing on for day two"
Pending
The speaker's rule is to limit daily losses to an amount that can be recovered within the same trading day.
"I never want to lose more in one day than I can recover in one day"
Pending
Traders without a proven profitable track record in a simulator should not be trading with real money.
"if you don't have a positive track record of profitability in a Sim what are you doing putting real money on the line you really have no business doing it"
Pending
Following a red day (or month), it is crucial to immediately implement 'guard rails' to minimize the risk of experiencing consecutive losing periods.
"after a red day or if it's for you maybe it's a red month or whatever it is immediately as soon as you become aware Implement these guard rails to reduce the risk of back-to-back red days"
Pending
Traders should be swift in reducing their trade size when market conditions become unfavorable ('cold') and develop a strong awareness of cautionary signals in the market.
"be quick to size down when it gets cold and learn to develop a keen awareness of caution Flags in the market"
Pending
During a recovery phase, the maximum trade size should be one-quarter of the usual full size, with a focus on securing small, consistent wins ('base hits') to build a cushion.
"Max size is one qu of full size Max size is one quarter full size focusing on base hits focusing on building cushion"
Pending
After approximately five trading days following a significant loss, with some recovery achieved, the trader typically experiences a substantial improvement in their emotional state.
"once I've had about 5 days between me and the loss by that point usually I've made back a little bit of the loss and I'm feeling emotionally a thousand times better"
Pending
Sizing up trades again occurs only after the trader feels emotionally stable and has recovered nearly half of the previous loss.
"once I'm truly feeling emotionally better and I've made back close to half of the loss then I start to size back up for the next leg higher"
Pending
On the day of the recording, the speaker focused on securing small, consistent wins ('base hits') and successfully executed this strategy.
"so today was a day where I came in looking for base hits and I locked up base hits"
Pending
For traders experiencing an extended drawdown, the immediate priority is to stop further losses and implement a trading plan for a gradual recovery.
"if you've gone through an extended draw down your number one Focus right now has to be stop the bleeding and put yourself into a trading plan where you can begin your recovery slow and steady"
Pending
Consistently achieving small wins ('base hits') and securing small green days over a 5-10 day period can lead to a significant improvement in a trader's emotional state and confidence.
"if you could start focusing on hitting base hits locking up you know small green days 5 days from now 10 days from now you're going to feel like a different person"
Pending
The potential downside of entering a recovery phase ('trader rehab') is missing a significant market move, but the significant upside is the ability to emotionally reset and trade with renewed confidence and consistency.
"the downside of not doing it is well what if there's a big move and I miss it okay that would be disappointing you're in Trader rehab you missed the move but the upside benefit that's your only downside your upside is that you will be able to reset emotionally and get back to trading from a place of confidence and consistency"
Pending
Missing a single trade is inconsequential as the market will continuously offer new trading opportunities.
"you miss one trade who cares there's always going to be another trade around the corner"
Pending
The market will always be available for trading; this is an opportunity to build experience and intuition to know when to adjust trading intensity (ease off, get aggressive, or cool off).
"as I always tell you guys is look the Market's going to be here for you this is your time right now to build your experience and your own sense of educated intuition so you can get better at learning when to ease on the throttle when to get aggressive and when to cool off"
Pending
A disclaimer stating that trading is inherently risky, the speaker's results are not typical, and advising viewers to trade cautiously, manage risk, and recognize the market's endurance.
"trading is risky my results aren't typical so please take it slow manage your risk the market will be here for you"
Pending
After approximately five trading days following a significant loss, with some recovery achieved, the trader typically experiences a substantial improvement in their emotional state.
"once I've had about 5 days between me and the loss by that point usually I've made back a little bit of the loss and I'm feeling emotionally a thousand times better"
Pending
For traders experiencing an extended drawdown, the immediate priority is to stop further losses and implement a trading plan for a gradual recovery.
"if you've gone through an extended draw down your number one Focus right now has to be stop the bleeding and put yourself into a trading plan where you can begin your recovery slow and steady"
Pending
By detaching from the emotions of a drawdown and making even small incremental progress (e.g., $200 a day), a trader can feel positive and confident, regardless of the total amount still down.
"when you separate yourself from all the emotions of the draw down and you start having even just a little incremental progress that's when you feel like wow it doesn't matter that I'm technically still down $75,000 I'm making2 200 a day and if I can make 200 a day for the rest of this year for the rest of next year ... it's smooth sailing for me and I'm good"
Pending
Sizing up trades again occurs only after the trader feels emotionally stable and has recovered nearly half of the previous loss.
"once I'm truly feeling emotionally better and I've made back close to half of the loss then I start to size back up for the next leg higher"
Pending
On the second day after a major loss, the 'guard rails' include sizing down trades and focusing exclusively on high-quality stock setups where the trader has historically been most profitable.
"on day two guard rails number one we size down that's the first thing you've got to do you've got to size down number two you focus on a quality stocks that's going back to the basics of what your metrics tell you you do the best wherever you make the most money that's what you're focusing on for day two"
Pending
The speaker's rule is to limit daily losses to an amount that can be recovered within the same trading day.
"I never want to lose more in one day than I can recover in one day"
Pending
Traders without a proven profitable track record in a simulator should not be trading with real money.
"if you don't have a positive track record of profitability in a Sim what are you doing putting real money on the line you really have no business doing it"
Pending
Following a red day (or month), it is crucial to immediately implement 'guard rails' to minimize the risk of experiencing consecutive losing periods.
"after a red day or if it's for you maybe it's a red month or whatever it is immediately as soon as you become aware Implement these guard rails to reduce the risk of back-to-back red days"
Pending
Traders should be swift in reducing their trade size when market conditions become unfavorable ('cold') and develop a strong awareness of cautionary signals in the market.
"be quick to size down when it gets cold and learn to develop a keen awareness of caution Flags in the market"
Pending
During a recovery phase, the maximum trade size should be one-quarter of the usual full size, with a focus on securing small, consistent wins ('base hits') to build a cushion.
"Max size is one qu of full size Max size is one quarter full size focusing on base hits focusing on building cushion"
Pending
After approximately five trading days following a significant loss, with some recovery achieved, the trader typically experiences a substantial improvement in their emotional state.
"once I've had about 5 days between me and the loss by that point usually I've made back a little bit of the loss and I'm feeling emotionally a thousand times better"
Pending
Sizing up trades again occurs only after the trader feels emotionally stable and has recovered nearly half of the previous loss.
"once I'm truly feeling emotionally better and I've made back close to half of the loss then I start to size back up for the next leg higher"
Pending
On the day of the recording, the speaker focused on securing small, consistent wins ('base hits') and successfully executed this strategy.
"so today was a day where I came in looking for base hits and I locked up base hits"
Pending
For traders experiencing an extended drawdown, the immediate priority is to stop further losses and implement a trading plan for a gradual recovery.
"if you've gone through an extended draw down your number one Focus right now has to be stop the bleeding and put yourself into a trading plan where you can begin your recovery slow and steady"
Pending
Consistently achieving small wins ('base hits') and securing small green days over a 5-10 day period can lead to a significant improvement in a trader's emotional state and confidence.
"if you could start focusing on hitting base hits locking up you know small green days 5 days from now 10 days from now you're going to feel like a different person"
Pending
The potential downside of entering a recovery phase ('trader rehab') is missing a significant market move, but the significant upside is the ability to emotionally reset and trade with renewed confidence and consistency.
"the downside of not doing it is well what if there's a big move and I miss it okay that would be disappointing you're in Trader rehab you missed the move but the upside benefit that's your only downside your upside is that you will be able to reset emotionally and get back to trading from a place of confidence and consistency"
Pending
Missing a single trade is inconsequential as the market will continuously offer new trading opportunities.
"you miss one trade who cares there's always going to be another trade around the corner"
Pending
The market will always be available for trading; this is an opportunity to build experience and intuition to know when to adjust trading intensity (ease off, get aggressive, or cool off).
"as I always tell you guys is look the Market's going to be here for you this is your time right now to build your experience and your own sense of educated intuition so you can get better at learning when to ease on the throttle when to get aggressive and when to cool off"
Pending
A disclaimer stating that trading is inherently risky, the speaker's results are not typical, and advising viewers to trade cautiously, manage risk, and recognize the market's endurance.
"trading is risky my results aren't typical so please take it slow manage your risk the market will be here for you"
Pending