Sensory Overload

Sensory overload . . . a big issue in trading and in developing your trading psychology.

It comes from all angles – information about what to do, what supposedly works, what to invest in (education), magic solutions, chart data, news, pundits, and rumors. Just Google “Forex” (250 million results) or “Trading” (1 billion results.) Where and when does it stop?

Our problem is fear of loss – believing that if we ignore anything it may be the one thing that propels us toward success – so we try to absorb it all. The fact is we can’t. But, we sure waste a lot of time and a lot of money trying to. I can save you some time and money right now – don’t buy any robots or magic buy/sell indicators. They’ll never work for you – and when they don’t, you’ll be more confused and frustrated. These distractions are a nothing more than an excuse to absolve you of responsibility and accountability.

The answer to your trading success is not more “stuff.”

Then there is distrust and skepticism. Whom do we trust after having purchased so much crap and being taken advantage of? Are there really any legitimate resources that we can relate to, rely on, and that have our best interests at heart? (There are a few and you’ve found one here, but I’m not going to waste time trying to convince you.) It is difficult to trust again after having felt like a sucker time and time again – embarrassed for still believing the overblown promises and sales pitches.

Sadly, it is often too late or at the expense of real value that we finally just start to give up or wonder if we can really become successful at this.

How do we ultimately filter through all of this noise? There is no one right answer. The best advice I can give is to do it through trial and error. You have to find what fits your own personality and proclivities. And then you have to act. You have to become good at assessing quickly – is the presenter/ making sense? Does he/she have a track record of results? Does the information/program account for all aspects of complete trading education delivered in a logical and professional manner? If not, move on. Chances are the “product” will be yet another in a long line of wasted time and resources.

If you are at the point where you are frustrated and just kind of spinning with no direction, I suggest you stop trading and start over. Get back to the basics. There are time tested principles that have worked for ions and marketers are counting on your laziness.

Look for information that will provide a solid foundation and then a realistic progression of Trade Plan Development. It should cover everything you need to be successful and independent – and that’s why you got into trading in the first place . . . right?

Here’s what you need to know and learn . . .

Foundation and Basics – Learn and understand the language of the market.

Platform and Charts – Become efficient at using and executing on your platform software.

Systems and Tools – Find indicators and processes that you can understand and implement.

Trade System and Testing – Develop rules for entry, stops and targets and then test and adjust to determine long term system profitability (no less than 200 occurrences.)

Practice and Repetitions – Practice executing your system on your platform for accuracy and dexterity on your demo account.

Live Trading and Psychology – Trade a micro account to develop and adjust your own trading psychology to control emotions and subjectivity.

Consistency and Transition- Track your results for consistency and execution. Once you can perform with confidence and reliability, think about a plan to transition to full time trading if that is your goal.

Risk and Trade Management – Explore expanding your strategies and formulate increasing your position sizing based on your historical performance data and account equity.

That’s a basic outline and, of course, there are more details involved in each step. The most important thing to remember is to master each step before moving on and do not skip any steps. Do either of those and you will create challenges and cost yourself thousands of dollars.

The very first thing to do is take a deep breath and relax.

You can do this.

Rick

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