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Trade Mindfully: Achieve Your Optimum Trading Performance with Mindfulness and Cutting Edge Psychology by Gary Dayton

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CHAPTER 9

The Trading Psychology Process: High-Quality Preparation

In Part I and Part II of the book, we have looked at how our minds work and what we can do to develop effective mental skills to overcome the psychological challenges we face in trading. If you have made the effort to complete the exercises and have applied some of the methods presented in the book, you may now be able to begin recognizing the mental shortcuts that affect your trading and to engage your deliberative mind better, and you may now see the influence of cognitive heuristics and biases beginning to subside. For traders who have become ensnared in thoughts and feelings of fear or other strong emotions, if you have started practicing mindfulness, you may be able to begin defusing from those thoughts and feelings, maintain better attention on the market, and start to take the actions that support your trades. You are now on the track to greater success. However, overcoming psychological challenges is only one aspect of trading psychology. For traders to maximize their trading performance there is another very important aspect of trading psychology traders need to know and learn: performance psychology.

So far we have dealt only with what seems to be “negative” psychology: the psychology of negative emotions, unwanted thoughts, cognitive biases, and erratic behaviors. But there is a “positive” side of psychology traders can employ in their ­trading. In fact, it is the positive psychology that can constructively ...

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