The Power of the Mind

Posted by tradeyouredge on October 14th, 2014

You do know that the mind is a very powerful trading resource, do you not? You also know that it is an important tool that can help you achieve trading success easily and effortlessly, right? If you agree (and I know you do), then great news for you because you are either already part of the 10% of traders who have achieved trading success, or you are moving towards success sooner or late.

By the way, I wasn’t kidding when I said you are part of that 10% because, two weeks ago, as I was browsing some trading websites (and forums), I came to realise that there are many traders who are unaware of the importance of trading psychology. Many still think that the trading system is most important part of trading and they should only focus on that. Of course, since everyone has different learning experiences, there is no right or wrong opinion (that’s why it’s called an opinion).

With that, I thought it’ll be interesting to elaborate my view of what it means to have a great and resourceful trading psychology. Hopefully, you too can come forward to express your view on this topic (at the comment box below).

You and I have a Powerful Mind Too

The beauty of the powerful mind is this, Everyone has one. If you don’t believe me, here’s a fun exercise. When you’re ready, I want you to think of a car. Now think of a cat. Now think of a house. Now think of a clock.

Were you able to catch up? If yes, let’s take this one step further. I want you to think of your favourite restaurant. You are in the restaurant and you ordered your favourite dish or meal. You might have been there yesterday, last week or a long time ago. It doesn’t matter because you can already imagine the food in front of you and it smells really good. You have a smile on your face and you are happy.

Ok, coming back to this article, I hope some of you were able to imagine those items that I mentioned. Did you realise that when you were reading the list above, your imagination got you there within a nano of a second? For some, as soon as you read the word, the images were already in your head and you didn’t have to pause for 5 seconds to think about what a car, a cat, a house or a clock is like? Your mind already knows that and all it does is it takes those images from your “back office” and sends it to the “front office”, and it does so instantaneously.

For some, even if you only managed to imagine just one of the suggestions above, that’s already evidence that you have a powerful mind. In fact, it only takes one image to proof my point. For those who actually smile or even became slightly hungry when you were thinking of your favourite food, that just means you clearly love your food and you are very in tuned with the food you like.  If you couldn’t, that’s fine too because food might not be your thing.

The Mind is a 5 Year Old Kid

Here’s another thing that you need to know about the mind – It’s like a 5 year old kid. What do I mean by that? Well, the mind is simple and is not good with complicated stuff, just like a 5 year old.

Let’s say you asked a 5 year old boy to kick a ball, he’ll kick it without much thought. However, if you ask the kid to put the ball in the middle of the room and kick it at a 45 degree angle, the boy will stare at you for a moment and ignore you as he will kick it like he did before. Of course, he could probably do it but you need to teach the kid how to.

Note: I’m not a parent, so, whether we’re talking about a 3, 5 or 7 year old kid, the point is that kids take think as it is.

The same applies to the mind. Sometimes, the mind fails on the most trivial thing. For example, if I asked you to NOT think of a pink elephant, the mind will inevitably think of the pink elephant first before it removes it to focus on something else. While all that happened very quickly, it’s requires much more effort compared and it takes more time. Again, this is because the mind cannot handle anything more complicated than a simple suggestion.

For example, some of you might have got a little confused when you read the word cat after moving from the word car. While it might not happen to everyone, some would have read car twice before it realised that I was referring to a cat and not a car any more because the image of the car was still stuck in your head. In fact, that is how Tongue Twisters work, isn’t it? Your mind can be confused.

The Trading Mind

Bringing you back into the context of trading, the mind works exactly the same way.

I believe you now understand my point and agree that the mind is a powerful storage of knowledge and memory. Because you can retrieve memories (like favourite food) within a nano of a second, you can also access trading patterns, setups and trading rules exactly the same way. However, just like a kid, the mind only picks what is simple and easy to access, thus ignoring everything else (like the location and angle of the kick).

Separately, for some traders, you struggle to access their trading tools (from the mind) in time – thus causing trading errors and mistakes. That’s because you are not in-tuned with that part of the mind yet. Again, just like the 5 year old, all you need is to teach the mind how to.