Wednesday, January 3, 2018

5 Ways to Start Trading in the Zone | Trading Psychology

Ask any experienced trader what it feels like to be trading “in the zone” and he/she will tell you that it feels like someone else has taken control of your body and is trading for you… you’re energized and hyper-focused, you see the market and trading opportunities clearly, effortlessly finding profitable trading opportunities, and everything else around you seems to fade away.

Professional athletes may call this a “flow state”, or “peak performance”, but no matter what name you give it, trading “in the zone” requires total focus on what you’re doing at that specific time.

In today’s psychology lesson, I’m going to give you five (5) ways to start trading “in the zone”…

But before I go into today’s lesson, I want to remind you that this psychology lesson is the most recent in a series of psychology videos that I publish every week, and these videos build on the topics we’ve already discussed, so if this is the first video you’re watching, you might want to go back and start from the beginning to get the most value out of these lessons.  Ill leave a link down in the description…

Here’s the link to watch from the beginning

I also want to remind you to subscribe to this YouTube Channel, give me a thumbs-up if you like it, and share it with a friend if you think they can benefit as well.

And if you really want to stay in-tune with what’s going on here at SchoolOfTrade, join our mailing list on the homepage of our website, or on my blog at

Ok, now that we got that out of the way… let’s get into today’s lesson.

How do we start trading “in the zone” each day?

The answer is simple, we need to remove all distractions, allowing our minds to do their jobs and execute the task at hand.

The hard part then, is developing our minds in a way that we allow ourselves to actually have that high level of focus.

Do you remember that lesson I did a few months ago on the topic of analysis paralysis and performance anxiety

If you recall in that video, the key to performing at the highest level was to stop worrying about the results of our performance.  We talked about how important it was for traders to remove the fear of losses, which would allow them to have greater focus and better results… make sure you watch that video if you haven’t already because it applies directly to this topic as well.

Repetition & Routine:

The first step to trading “in the zone” is to make your trading strategy as repetitive and routine as possible.

The human brain is a remarkable tool for this… anything we do consistently in the same way, our brain remembers, which makes it easier to do it the next time.  It almost feels like your brain acts like a computer… running specific “scripts” or “code” for each desired task.

This is why most people can brush their teeth or tie their shoes without evening thinking about it… they’ve done it so many times, the same way, that when they pick up a toothbrush their brain just executes the same “script” that it did before.

The most important aspect of repetition when it comes to getting “in the zone” is that you are going to develop a “script” that your brain can execute without much thinking needed on your end.

Start by using a simple set of black and white rules for your trading strategy.  By following those rules, you start developing those “scripts” for your brain to use when you’re trying to get “in the zone.”

Find Your Niche:

Now that you have your trading rules and you’re working on automating those “scripts”, the second most effective way to use those rules is to focus on a specific niche in the market.

After all, if you’re going to build those habits, you should do so in the most positive and effective way possible… right?  You want those scripts to help you, not hurt you.

In a previous lesson I discussed the most effective way to stop over-trading or stop “forcing trades”, which was all about finding your niche and focusing your energy on that specific aspect of the market.

If you haven’t watched that video, make sure you do that when you finish this lesson.

Understand the “Story”

A third way to get “in the zone” with your trading is to learn how to understand the “story” the market is telling you, which is also known as the market’s “context.”

If you’re a client of mine, you hear me say this all the time… “what’s the storying being told?”

When I say “story” I’m referring to the context of the market.  In other words…

·        Is this a trending market? If so, who has control of that trend?
·        Are we at the beginning or the end of the trend?
·        Is the market trading sideways in a range?
·        Are we at the highs or the lows of that range?

Im always asking these questions when I run my trade room, forcing my clients to always be thinking about the market’s context.

Personally, I find one of the most effective ways of getting “in the zone” is to invest the time to understand the market’s context… and I’ve created a simple tool called the 'Price-Action Cycle' to help me identify that “context”

This the opposite of what I did when I first began my career. 

Like most rookie traders I never took the time to find the “context” or the “story”, my focus was nothing more than using technical indicators to find buy and sell signals… which like most rookies… didn’t give me very good long-term results.

If you want to get “in the zone” with your trading, learn how to define the market’s context, or what I call “the story of the market.”

Focusing on the Process, Not the Profits

Next up… the fourth way to get “in the zone” with your trading… is to focus on the process, not the profits.

One of the biggest mistakes we can make as traders, making it almost impossible to trade “in the zone” is to allow our minds to focus on the results of each trade, rather than the process of finding the best trading opportunities.

If our goal is to trade “in the zone” we need to remove the fear of loss by…

·        Clearly define your entry and exit rules
·        Execute at least 100 trades in simulation before going “live” (battle-tested)
·        Risking less than 5% of our account on any single trade (I would prefer 3% personally)
·        Only trade with capital you can afford to lose (risk capital)

I did a lesson a few months ago on the topic of how to remove anxiety from your trading, which is an excellent lesson that builds on this idea… so make sure you check that out as well.

Embrace Diversity

The fifth way to get “in the zone” with your trading is to diversify your trades, and your trading career.

First, it’s important to remember that a successful trading career is the result of tens of thousands of trades… not just one single trade.

That’s why you’ll hear me say that trading is a game of pattern recognition and long-term probabilities.

My trading strategy has proven to be effective over the long term.  No, I can’t tell you what each individual trade result will be, but I know that over 100+ trades my strategy is going to perform quite well.

If I approach the markets with this type of “diversified” mindset, I give myself a much better chance at trading “in the zone” when I do.

It’s also important to diversify your LIFE as well. 

I recently published a video on the topic of 3 ways to make trading easier, and deep in the content of that lesson I talked about how important it was to have positive experiences with things OUTSIDE of trading.

Whether it be personal development, health and nutrition, hobbies, community, relationships, spirituality, etc., by diversifying your life you won’t get so hung-up on the times when trading gets difficult.

Most importantly, when you have other aspects of your life that bring you joy, you won’t struggle with the results of each trade.

Wow…We’ve covered a LOT in this psychology lesson, so let’s do a quick recap.

Today we talked about trading “in the zone”, which is a state of “flow” and positive hyper-focus that the best traders experience when they are executing their trades.

I gave you guys five (5) ways to start trading “in the zone”

1.      Repetition & Routine (develop the mental “scripts”)
2.      Trading within your Niche
3.      Invest the time to understand that “Story” or “Context” in the market
4.      Focus on the Process of trading, not the profit
5.      Embrace Diversity (leverage the law of large numbers & diversify your personal life)

Wrapping things up… I hope you found a ton of value in today’s trading psychology lesson…

…and I would love to hear from you about additional topics that you’re struggling with as traders.

Do me a favor…drop me a comment below this video with any topics you’d like to see me cover in my next psychology video…

… give me a thumbs-up if you found value, subscribe to the channel if you’re not already, and please don’t forget to share this video with a friend who can benefit from this information as well.

And don’t forget, you can find me every morning @ 8:00am EST working hard in my trade room with all of our members here at, I have a great free trial on the homepage of our website, I publish my Nightly Newsletter every evening on my blog before 8:00pm EST, and I’m excited to see you again soon on my next trading psychology lesson.

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