Essential questions that traders should be asking themselves daily, as a part of their trading plan.
Today we’re going to give you the tools necessary to start each day on your best footing possible. In order to create a perfect environment and achieve mental harmony, your physical elements need to come together. It is essential that you know what’s going on inside your head.
In order to explore and discover your various mental states and what is needed to control them, you’ll need a daily mental routine where you prepare yourself cerebrally for the trading day ahead.
For this preparation, you’ll need to think about your previous trading day’s experience and also about what it is that you’ll need to do today in order to maintain success and/or create more. For example, let’s say the previous day’s trading ended well. Are you feeling well enough, confident enough or too confident to succeed realistically in the market today?
Or let’s say yesterday ended poorly. Are you entering your trading in revenge mode today? Or are you over-aware and able to be better today?
We’ll tackle all these issues and more in order to ensure you’re properly prepared for the trading day ahead.
Preparation for the Trading Action Ahead
Before you begin trading, you should do some preparations to put yourself in the zone. Take a bit of time and concentrate, think of the things that will help put you in the right mindset for trading.
Below is a list of questions to ask yourself before beginning each day:
- What is my positive motivation line for the day? Is there any quote that inspires me to use as a motivational guideline for the day? Is there something I can pinpoint that might drive me to success today?
- What are my long term goals? This one’s important to write down even if doesn’t change from day-to-day. Write it down daily to always have it in front of you. Remind yourself over and over what it is that you would like to accomplish in the long run.
- What is my goal for today? What is the tactical achievement that I would like to achieve for today? For example, yesterday was not a good day, so I will use today to recover. What is a reasonable goal for that I expect for myself today? Remember to keep these realistic to avoid unnecessary frustration.
- What are my goals for the month and how do I currently stand towards achieving those? Notice any changes according to these goals and make any changes if necessary regarding your daily goals in order to put you back on track to achieve the monthly goals.
List of Tasks to Complete Before Trading
In addition to asking yourself preliminary questions, explore what you need to do in order to create the right environment to consistently succeed in your trading. This might mean cleaning up your charts and analysis, looking up economic events, clearing your desk, reading emails and, and/or tend to administrative and family chores. It’s also helpful to re-read your trading plan or rearrange your strategy. Try to cover all of your blind spots before you’re ready to trade.
Ask Yourself More Questions
The next set of questions is about defining your mental and emotional awareness of trading. The questions and answers may repeat daily but that is necessary because it ensures further awareness.
- How do I know I’m ready for my trading day? What things will guarantee I’m ready? My charts, desk, hours, length of breaks/lunchtime. What is my mental state today? How is my health? Write it all in detail.
- What is my impression from my last trading day and how might it affect me? Was it an easy day? Did I win, lose, or breakeven? Write down everything you carry over from your last session and how these things may affect you today.
- What interferences do you expect from your trading for the day? How is my health? My mood? Know if today is a day that you should be more patient than usual or if you may need to take a longer or shorter break. Try your best to understand your emotions in order to plan accordingly.
Put Down the Facts
In addition to questions, also write down a few cold hard facts that pertain to your trading. Write about how you know you’re in the zone for trading. Put down the signs and signals that tell you that you’re fully in the work, completely focused and ready for the work.
On the flipside, also write about how you know you’re not in the zone. Put down the signs and signals that show you this. Jot down what distracts you and what takes you out of the trading zone. Jot it down so that next time it happens, you’re able to quickly recognize it and take the necessary steps to fix the course.
The questions laid out here are merely a guide and you are able to add as more as you would like. Whether you add extra or not, the bottom line is that it’s important to maintain such a diary. Every day add to and review the diary so that you end up as familiar as possible with the positive and negative things.
It’s important to be mindful of your emotions. If you want to achieve success, it’s imperative to listen to and be aware of everything that is going on in your surroundings especially how it affects you.