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The 4 Stages To Becoming A Millionaire Trader

What’s Inside?

  • The 4 stages to becoming a millionaire trader
  • What is the most important stage to making money trading?
  • What trading and mindset skills you need to become a profitable trader?

Since February of 2018, I’ve been envisioning how I want to build a complete trader training program that will teach you the stages, skills and mindset you’ll need to build to become a highly profitable trader who can pull a million dollars out of the market. I actually started working on this article over 6 months ago, and it has finally come to fruition.

If there was only one trading article you could read on my site, this would be it, so grab the popcorn as it’s a heavy hitter.

The goal of this article is to teach you about the 4 stages to becoming a millionaire trader. It’s designed to be a roadmap and structure for how to get from where you are now (likely struggling) to becoming a professional trader who can make a million dollars trading the markets.

millionaire-trader 2ndskiesforex

Before I get into the stages and roadmap, I have to explain a fundamental component and basis for this article.

Buddhism And Trading?

For the last 18 years, I’ve been training in Tibetan Buddhism, particularly in the Nyingma tradition. One of the amazing components of training in Buddhism is the ‘structure‘ and ‘stages‘ they clearly lay out for you. And a fundamental aspect of Buddhist practice has to do with the following formula:

Base, Path & Fruit

To explain this simply, the ‘base‘ is the starting point and foundation you build everything else upon.

It’s a fundamental level of direct experience and understanding you need to have to complete a specific aspect of your training. It’s arriving at the base which is what makes any practice, training or method work. Without this, you’re just wasting your time.

Keep in mind, it is not something you can arrive at ‘conceptually‘. What I mean by this is, it’s not something you can just read in a book and understand. You have to have the actual direct experience before you can progress any further.

Think of it like this:

Who would you trust more? Someone who’s lived in Buenos Aires (Argentina) their whole life, and knows the city, streets, traffic patterns, restaurants, various barrios, how ‘corruption’ affects their daily business, local customs, etc? Or someone who’s spent the last several years ‘reading‘ about Buenos Aires, looking things up on google, and watched youtube videos about it?

I’m guessing every time you’ll take the former hands down, which you’ll notice has nothing to do with ‘intelligence’. The person who’s lived in the city has a ‘direct experiential‘ knowledge about Buenos Aires that cannot be read in a book, watched in a video, or learned ‘conceptually’. It has to be a direct experience!

The same goes for the ‘base’ in trading. If it’s not a direct experience, you simply cannot progress any further. This is what I mean by ‘base’.

The ‘Path‘ is the practice, methods and training you use to get you to the direct experience. It needs to be a specific path which takes you from point A to B.

The path needs to be very specific and clearly demonstrated to produce real results.

The ‘Fruit‘ is what you get when you fully complete the ‘path‘ by using those practices, methods and trainings. It’s the ‘result‘ of what you get when you do the work, and it also should be specific.

If you have the base in place, then you can begin the journey. If not, you’ll need to arrive at the base (just like you have to arrive at ‘base camp’ to climb Mount Everest), before you can proceed any further. There is absolutely no way to skip steps here.

This entire training and article is built upon these principles of Base, Path and Fruit. Simply put, if you follow the structure I’m laying out here for you, your progression will naturally follow and you’ll see the results in your trading performance, mental execution and mindset.

Each of the 4 stages to becoming a professional trader has it’s own ‘Base, Path and Fruit’. Before you can progress to the 2nd stage, you’ll have to complete the first. There is no way around this! So if your goal is to make a million dollars trading, you’ll want to go straight for the first stage.

Becoming A Millionaire Trader (Stage 1)

The very first stage to becoming a millionaire trader is what I call the ‘Stage of Discipline‘.

The ‘base’ of this stage is having the direct experience and realization that:

a) your brain is currently not wired to trade successfully
b) you’ve had the experience of how your mind, emotions, and skill-set are currently not sufficient to consistently make money
c) have a real passion for trading, and
d) a mindset focused on growth

If you have those 4 things in place, you have the sufficient ‘base’ to begin the first stage.

By now, you’ve probably witnessed how your emotions affect your trading decisions (FOMO, not pulling the trigger, fear of losing money, risking too much/too little, etc). You’ve probably also noticed how you’re not consistently disciplined in your approach (system hopping, changing instruments, not sticking to your trading plan, etc).

Sound familiar?

If you’ve realized what you’re doing isn’t working, and that you’re lacking certain skills + training, but still have a passion to make money trading + are focused on growth, then congratulations – you’ve arrived at the base of the first stage. You’ve accepted the fact you (by yourself) cannot make this work, that you need a trading mentor + build new habits to succeed.

If you’re here, then you’re ready to actually begin the first stage, which is the stage of discipline.

The only thing you need to pack in your bags from here on out is a commitment to getting past this first stage. You don’t need to have the commitment to become a billionaire trader. Just having the commitment and openness to train is the minimal requirements to begin the first stage. Consider this stage to be your ‘apprenticeship‘ in becoming a successful trader.

The ‘fruit’ of the 1st stage of discipline is ‘consistency‘. If you don’t have consistency, you’ll never a) succeed in trading, and b) make it to the 2nd stage.

I say ‘consistency‘ is the ‘fruit’ of this stage, because it’s what you get when you have a solid level of discipline in place. Without this, there is no progression in trading, and you’ll continue to make the same mistakes over and over and over again.

Does this sound like your current experience?

Thus, discipline is what helps you exit out of that cycle (repeating the same mistakes). It’s the force which allows you to break through your current bad habits around trading. It’s what allows you to execute the same things over and over again, regardless of the emotions you feel, or obstacles you come against.

Consider discipline a type of ‘armor‘ against that which will knock you off your horse and derail your progress. Essentially, it protects you against yourself, and is absolutely necessary in trading..

From my experience, both in Buddhism, and in trading, it actually has to get worse before you give up your current approach (which likely isn’t working). You actually have to suffer to the point you realize “I no longer want to suffer like this. I’m open to trying it differently.” This realization creates the first real opening for you to get out of that vicious cycle of repeating the same mistakes over and over again.

The ‘path‘ of the stage of discipline is the most intricate and nuanced part of your trading progression. It’s the hardest part of the mountain to climb, and requires the most effort on your part. This is because you’re going to be fighting against much of what you currently are, which by definition, is insufficient to consistently make money trading. If you were already there, you’d be doing it.

The ‘path’ has to consist of a series of methods and skills (trading and mindset wise) you’ll need to build to get to the ‘fruit’.

Practices & Methods For the Stage of Discipline

As stated before, the goal or fruit of the stage of discipline is consistency. This means consistency in your execution, decision making process, trading strategies you are using, what instruments you trade, risk management, etc.

Consistency, however, has a ‘root cause‘, meaning the root of what it grows out of. As I’ve stated before, consistency can only come from the mind. If you do not have consistent thoughts, thinking patterns, neurological structures, mindset, (etc) there will be no consistency in your trading. Hence your focus for building ‘consistency’ has to primarily consist of (and begin with) your mind.

If you are currently not experiencing any sort of consistency in your trading, then congratulations, you’ve discovered the root cause of your inconsistency (your mind). Now your initial goal in trading and becoming consistent may seem counter-intuitive, but I’m guessing you’ll find it makes sense when you fully understand it.

Your initial goal in trading should be to become a ‘consistently‘ losing trader. Now many of you are likely thinking “I consistently lose now, why would I want this?” While that may be true in ‘form’, it’s not true in ‘essence’. What I mean by this is, while you may be consistently losing money, there are likely many components of your performance which are not ‘consistent’.

Some of these components can be:

  1. Risk Management – are you consistently risking the same % per trade? If not, then you’re not ‘losing consistently’.
  2. Trading Instruments – are you consistently trading the same instruments till you have a sufficient baseline to make a quantifiable decision? If not, then you’re not ‘losing consistently’
  3. Times of the day – are you consistently trading the same times of the day? If not, then you’re not ‘losing consistently’
  4. Pre-trade preparation – are you consistently preparing mentally for your trading day with the same routine? If not, you’re not ‘losing consistently’
  5. Pre-trade analysis – do you have the same consistent routines and methods (price action, ichimoku cloud trading, etc) for finding trading setups? If not, then you’re not ‘losing consistently’
  6. Post-trade analysis – do you have the same consistent routines and methods for analyzing your completed trades? If not, you’re not ‘losing consistently’
  7. Reinforcing successful trading habits – do you have the same consistent routines and methods for reinforcing successful trading habits? If not, then you’re not ‘losing consistently’
  8. Trading plan – do you have a detailed trading plan which has clear instructions for how to trade, how to train, and how to progress in your trading? If not, then you’re not ‘losing consistently’

I could go on as there are many other variables you’ll need to ‘lose consistently’, but my guess is, when you read the above and really take it all in, you’ll realize that you’ve been ‘losing money’ consistently, but not ‘losing consistently’. There a difference.

It takes discipline and a courage to say “I’m going to focus on consistently losing”, just like it takes discipline and commitment to not hit the target consistently in archery. But that is your initial goal in archery (not just hitting the target), but ‘consistency’ in your technique, process and movements. If there is no consistency in your stance, alignment, breathing, holding of the riser (main bow structure), how you grip the bow string, how far you pull it back, etc…there will be no consistency in where your arrows land.

(Image: Brady Ellison – #1 US Archer – Recurve Bow)

Trading is no different!

Hence in sounding somewhat masochistic, your initial goal in the first stage of discipline is to learn to ‘lose consistently’. By doing this, you’re building the foundation which the entire house you want to build will rest upon. Then you can focus on being a consistently break-even trader. Then you can focus on being a consistently profitable trader.

But before all this, you’ll need to focus on building the prerequisite trading skills, which can be defined as the following:

1) Trading Methodology & Approach

There are only 4 major trading methodologies, or approaches to the markets. They can be any of the following; 1) technical, 2) fundamental, 3) sentiment, 4) flow based.

Now any one of these can fall into broad categories, such as (discretionary, rule-based, hybrid, quantitative).

The approach I teach is a ‘technical‘ model based upon understanding price action context and the order flow behind it. I teach this method because it can be applied to any instrument, time frame or environment, and is based upon what all trading decisions are based upon (*information).

Regardless of whether you are a technical, fundamental, sentiment or flow based trader, all trading decisions are derived from ‘information’. Eventually that information has to be converted into an actual trade (and thus order). All ‘activated’ orders become ‘actualized’ order flow. And order flow is the most proximate driver of price action.

This is why I teach price action context and the order flow behind it, because I’m teaching you a ‘root’ method which communicates the footprint of all orders and trading decisions. By understanding these, you can give yourself the highest probability for trading with the dominant order flow in the market, which is what drives all price action. By doing this, you can learn to trade with the larger players who will most likely dominate directional price movements (which is what we want to capitalize on).

price-action-2ndskiesforex

Price Action Trading Skills

There are many price action trading skills you’ll need to build, and it is important not to learn these skills out of order. I often find traders trying to learn more advanced skills before they’ve built a solid set of foundational skills. One common example is struggling traders trying to trade counter trend before they’ve learned to trade with trend (with the latter being easier).

Now assuming you understand what candlestick charts are, time frames, and what the basics of price action are, then you’ll need to build your core skills of price action. In price action trading, the first set of ‘core’ skills you’ll need to learn is what I call the 3 pillars of price action context.

I’ve talked about the first pillar of price action context, which is being able to identify impulsive and corrective moves. The reason why this is the base pillar is it gives you the most amount (and most nuanced) information about the price action and order flow happening right now.

It tells you who’s in control of the market (buyers/sellers), and who’s not. It tells you how to read momentum in the price action without any indicators. It tells you when are optimal times to take profit, and not take profit. It tells you when you’ll need to be patient, and when you need to make a quick decision. It tells you when trading breakouts are more likely (or more probable) to occur, and when they are less likely to succeed.

impulsive-and-corrective-price-action 2ndskiesforex

There is a lot more impulsive and corrective moves can tell you about price action, but by learning these, you start to learn how to think like a price action trader, and see the dominant order flow behind it. This is why it’s the first pillar. If you want to learn about the other two pillars of price action context and the order flow behind it, then check out my price action course where we talk about this extensively.

Now before you can even practice these skills and making actual trading decisions, you’ll need to first be able to identify (with 90+% accuracy) these 3 pillars of price action context. My formula for how to build your trading skills (and price action skills) is simple:

Sim, then Demo, then Live

What this means is, after you’ve watched videos and understood (conceptually) the components of an impulsive and corrective move, you’ll want to start building your pattern recognition skills in the charts. You build these pattern recognition skills so you can identify them automatically, and thus, sub-consciously.

If you’ve ever looked at a chart and had the thoughts, “Is this a such and such pattern? I’m not sure, how do I know? I know it said it has to have x, y and z, but is this part the same, or is it different…“

Have you had this experience before? If so, then your skills are not ‘sub-conscious‘. The reason why this is important is you want to use your cognitive thinking, analysis and bandwidth for finding profitable trade setups. If you have all those thoughts going through your mind, then congratulations – you’ve now realized your skills are not sub-conscious, so that should be your next goal.

By starting with a trading simulator, you can have the opportunity to watch the price action unfold, pause it, take time to read it correctly, then resume the historical price action on the chart unfold.

trading simulator 2ndskiesforex

This is why sim is the best place to start, because on demo, the charts just keep moving on whether you got the analysis correct or not. Just like pilots start off in a flight simulator to make sure they have the basic functional skills to fly a plane, you also need to start off on a simulator.

By looking over thousands of candles and charts in a short period of time via a trading simulator, you can increase your learning curve, and accelerate your pattern recognition skills, particularly being able to identify impulsive and corrective price action.

Once you’ve seen enough impulsive and corrective moves, your brain will eventually assimilate these patterns into its database, and be able to identify them on any instrument, time frame or environment with ease (and without doubt).

After you’ve mastered all 3 pillars individually, the next step is to assimilate them together into one cohesive picture (or gestalt). The goal here is to be able to easily identify all three of the pillars of price action context, then be able to come up with a ‘most probable’ direction of the market.

I say ‘most probable’ because this is a mindset you’ll need to develop to make it out of the first stage of trading. Beginners try to use ‘confirmation price action signals‘ because they think they ‘confirm’ the trade and direction. But 1, 2 or 3 candles is a small amount of price action + order flow, and rarely ever dictates the next move (~1% of the time).

Hence you have to shift your mindset from ‘confirming‘ (because there is no certainty in the market) to ‘probabilities‘, because probabilities is all you are ever dealing with. There is no certainty, and never will be when it comes to price action and the next direction. This is why I say confirmation price action signals will crush your account. If these so called ‘confirmation price action signals’ actually ‘confirmed’ anything, there would be ample statistics and data to back that up. Yet nobody to date has been able to provide this (which should tell you everything you need to know about them).

Now while you’re building your core price action trading skills, you’ll also need to build your mindset skills. To succeed in trading, you’ll need a successful mindset which will keep you on track when things are challenging, and help you execute what you need to when your trades and emotions are really affecting your thoughts and trading decisions.

Mindset Skills to Build Consistency In Your Mind

If you’re working towards consistency in your mind, there are several core mind/mindset skills you’ll need to build. For the purposes of brevity and not turning this into a long novel, we’ll talk about the 3 most important mindset skills you’ll need to build consistency in your mind and make money trading.

The first mindset skill you’ll want to build is understanding how the brain works. By understanding how your brain and mind work, you can accelerate your learning process by working with how your brain functions, not against it.

One of the most fundamental aspects of the brain is its ability to re-wire itself. This principle is called neuroplasticity. 

Neuroplasticity can be summed up by the following phrase:

“Neurons that fire together, wire together”

Neurons are the basic neural cells you have in your brain. They connect to each other through axons and dendrites. By connecting to each other, they can pass information via electrical signals.

If you want to wire in a new trading habit, you’ll have to activate neural circuits which do this over and over again. By doing this over and over again, they strengthen those connections till they become ‘dominantly wired‘. Another term for ‘dominantly wired’ is ‘habit‘. Anything you have dominantly wired in your brain is a habit. So by firing the same neurons together, they wire together and form specific habits you’ll want and need to build a successful mindset.

This is where understanding how the brain works helps.

There are 7 components to neuroplasticity, but there is one fundamental ‘root‘ component behind all neurological wiring: Repetition.

By repeating the same thing (and thinking pattern) over and over again, you can wire in the trading habits you’re looking for.

It’s why basketball players will shoot free throws every day in practice. It’s why quarterbacks (American football) will practice throwing the football over and over again, so that their mechanics are automatic and sub-conscious. It’s why Bruce Lee said “I fear the man who practices one kick 10,000 times“, because such a person has that has practiced a kick 10,000x likely can throw it with speed, precision and power.

Repetition is the most fundamental building block to wiring new trading habits. Thus, understanding how the brain works is a fundamental mindset skill you’ll need to develop.

The second mindset skill you’ll need to build is what I call the GBT mindset. GBT = getting better today (also known as a ‘growth’ mindset).

growth-mindset 2ndskiesforex

Notice the focus here isn’t ‘profitable trading now‘. It’s a trading mindset that works every single day to get better. By getting better today at your skills, you eventually build enough skills and competence to make money trading.

The GBT mindset is one that is focused on the process, and has a well designed process + skills + goals they are focused on. The process aspect is the methods and plan of action you engage to build your skills, which allow you to reach your goals.

If you’re just focusing on the results “dang, I’m still not profitable yet“, then you’re jumping too far ahead and not focused on what you need to succeed (skills: 1) technical, 2) risk management and 3) mindset). Hence your ‘goal’ right now if you’re not a profitable trader should be to build the skills to make money trading.

This is why you need the GBT mindset, and an approach which focuses on building your skills step by step, and getting better today at your current level of skills. Then once these are sub-conscious, you take on the next challenge.

The third mindset skill you’ll need to build to become a consistently profitable trader is ‘self-awareness‘.

Now I’m not saying you have to become a zen monk to become a good trader. But you’ll need to develop a minimum level of self-awareness to make money trading.

Why?

Because if you really understand how the brain works, you’ll realize you are actually fighting your own brain and evolution to build a successful trading mindset.

How so?

Let me demonstrate this with a few key brain facts:

  1. You have about 500% more neurons for finding the negative vs the positive
  2. You are more likely to choose an immediate reward (even if it is a lesser reward) than delay gratification (for a larger reward)
  3. Your emotions heavily influence how you interpret (and code) an experience, memory or event

Now lets examine these 3 brain facts.

The first one should be obvious as to how it can affect your trading. If you are 5x more likely to notice the negative vs the positive, what do you think that means when you make a mistake, or a trade starts to go against you? How do you think that will affect your thinking in real time when you have to make clear, calm trading decisions? Do you think it will help, or hurt your decision making process?

Ever experienced a trade that was a winner but starts to go against you? Were you totally relaxed, or feeling ‘stress’ when it started to pull back? And do you think that stress affected your analysis and decision making? This tendency to notice the negative vs the positive is called the negativity bias.

What about the 2nd brain fact? Ever chose to exit a winning trade too early? This is your brain working against you. If you’re more likely to choose a lesser immediate reward, don’t you think that will become problematic in making decisions which will lead toward long term success and trading habits?

In terms of the 3rd brain fact regarding emotions, just think about the majority of emotions you’ve experienced in trading. Have they been mostly positive or negative? Have they mostly helped or hurt your trading process, thinking and mindset? Do you even know how to use emotions to your advantage in trading? My guess is no.

Hopefully it is becoming clear why self-awareness is key. You can determine if the self-talk that’s going through your mind is accurate (“something doesn’t feel right about this trade“), misleading (FOMO, fear of pulling the trigger, etc), or not important (“I wonder how many people liked my last tweet”).

By building self-awareness, particularly around trading, you can learn to know when you need to stick to your discipline and/or trust your gut instincts. You can also learn how to self-regulate your mind, emotions and psychophysiology so you can make the most optimal trading decisions.

Simply put, if your biology and psychophysiology is off (heart rate, breathing, skin conductance, etc), the chances of you making a bad trading decision go up exponentially! And more often than not, the difference between making money trading and losing money trading comes down to the trading mistakes you make.

Becoming A Clutch Performer

The term ‘clutch athlete‘ is actually misleading. When the game is on the line, the statistics are clear. The best performers are not performing at their peak, or above their baseline. They’re actually performing below their baseline. The difference is, they make the least amount of mistakes compared to their baseline, while the non-clutch performers make more. This is why specific athletes are clutch, because when the game is on the line, they make the least amount of mistakes, and thus outperform everyone else.

Trading is a peak performance endeavor that is skill based. There is no way around it!

This means you’ll have to learn how to become self-aware when trading gets intense. If you want to make a million dollars trading, you’ll need the 3 mindset skills I’ve listed above when you have 5 or 6 figures on the line.

By becoming more self-aware, you’ll start to build the psychological and mindset skills to become a consistent trader who makes ‘consistent’ trading decisions, regardless of the pressure or challenges you’re experiencing while trading. You’ll be able to direct your cognitive and mental activity in the right direction, while avoiding getting swept up by your emotions, or negative self-talk.

There are many ‘methods’ and practices you can use to build self-awareness. I teach several of these in my traders mindset course. But one method we focus on in our traders mindset course is meditation, which is scientifically proven to help improve your neurological and cognitive performance in a variety of trading activities.

meditation for trading 2ndskiesforex

I’ve been practicing meditation since 2000, done over 10,000 hours of meditation practice. I’ve completed a 1 year meditation retreat. I’ve completed 3 one month retreats, about 150+ weekend meditation retreats, and trained with the same meditation teacher since 2001. Needless to say, it seems fair to say I have a ‘solid’ training in meditation.

I recognized early on how important meditation is to my trading mindset, and thus created a 12 lesson meditation series specifically for traders. The goal of this practice is to build self-awareness, increase your emotional IQ, and help you enhance your brain’s functioning, which meditation has been scientifically proven to do. If you want to learn more about how to use meditation to become a better trader, then check out my traders mindset course.

Now there are many techniques you can use to build a successful trading mindset, but these are three most ‘fundamental‘ I’d highly recommend you focus on. There are other mindset skills you’ll need to complete the first stage of trading (discipline) and get to the fruit (consistency), which could take me an entire book to write and flesh out. But I feel I’ve given you a glimpse of the first stage of trading.

Getting Past the Hardest Stage (*And Not Jumping Ahead)

From my experience in working with thousands of traders, helping many traders become profitable, I’ve seen how every trader which has failed to become a profitable trader has never completed the first stage. They’ve either a) never built the mindset skills to become a ‘consistent’ trader, b) never built the core foundational skills, or c) tried to skip various aspects of both.

From all the students I’ve trained that have become profitable traders, they’ve all completed the first stage without fail. I’ve yet to meet a profitable trader who is able to make money consistently while skipping the first stage. There is no way around it!

Now if you want to learn about the other 3 stages to becoming a million dollar trader, I’m doing a private member webinar this weekend (Dec. 22nd) for all my course members. After the webinar, I’ll be making this webinar available to all my members so they can follow this road map and become consistent traders.

If you want to learn how to become a member, click here.

Now I hope you’ve gotten a tremendous amount of value out of this article, and use it as a guide and road map to your successful and profitable trading.

Please make sure to leave a comment, and share this with any friends or forums you feel will benefit from learning about the stages to becoming a million dollar trader.

Until then, may you see real growth in your trading and mindset.

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Trader Coaching Session w/Chris Capre {Pro Trader & Trading Mentor}

Hello Traders – every single week, I do a weekly coaching session with my traders and students in our price action course. We cover everything from trade ideas we posted during the week, trade setups I’m looking at, trading psychology, price action – anything my students have questions on.

In this week’s video, I’m sharing with you several clips from our weekly trader coaching session along with trades that I’m looking to do in the next week.

Get a FREE practice forex trading account:

– For EU/UK residents visit this link: http://go.xtbaffiliates.com/visit/?bt…
– For Non-EU residents visit this link: http://go.xtbaffiliates.com/visit/?bt…

Want to get my Price Action Course for FREE? Click here to find out how: https://2ndskiestrading.com/xtb/

⏰TIMESTAMPS⏰
1:53 – when trading intraday and only forex majors, do I need to take into account this?
2:09 – if trading intraday, you need to know volatility for each forex pair
3:33 – to get funded by me, what kind of a live track should I have and how much capital?
4:50 – how do you know if your meditation session has been effective?
7:23 – when trading in a corrective structure, should we only have a neutral bias in the price action?
9:25 – is ichimoku cloud trading something totally different from trading price action?
11:08 – NZDJPY (forex pair) trade ideas and price action analysis
15:48 – GBPCHF (forex pair) trade ideas and price action analysis
18:07 – WTI Oil trade ideas and price action analysis

Read more

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Forex Trading Q&A – How Do You Know What Price To Get In For Your Trade Setup?

In our new youtube series, we’ll be answering questions from the trading community covering various topics such as trading strategies, how to trade the forex market, risk management, trading psychology and how to build a winning mindset.

If you’ve struggled with any aspects of this in your trading, then make sure to post a comment as we might feature your comment in the next video.

In this week’s video, we’re answering a question from Dennis who asked that since we don’t trade confirmation price action signals, how do we choose our price to get in and what methods do we employ? 

Dennis also talked about some trading situations such as:

-price coming 1 pip from our entry and taking off towards our target
-price creating a false break, stopping us out and then going to our target

He wanted to know how we manage all these uncertainties.

Has this ever happened to you?

If so, then make sure to watch this forex trading video and leave a comment to get your question asked in the next video.

Read more

Analyzing The Performance of A Profitable Trader & Why You Need A Trading Mentor

Earlier this week I had a private skype call with a profitable student of mine (we’ll call him ‘Joe‘ for the purposes of privacy & this article). One of the major benefits of becoming a member of our price action course is you get a free skype call with me whereby I analyze your trading performance across a baseline of trades, and give you direct feedback across 20+ metrics to find leaks, patterns of your behavior that are hurting/helping your performance, and how we can refine your trading plan to make more money.

I recently highlighted one profitable student (Sam) who made +11% profit over 2 months using exceptional risk management (see image below):

sam-profitable-student-2ndskiesforex

Now if you look at the performance and equity graph above, Sam was a consistently break even trader until we did our skype call analyzing his performance and giving concrete recommendations for how to improve his trading. Two months later, he had a breakout performance with his most profitable months of trading to date.

Meet Joe Black – The Profitable Trader

Joe, whom we talked about earlier, is also a profitable student of mine who had performed exceptionally well from mid-September till the end of the year, making +22% profit over 4 months, even while having a 10% draw-down!

Here is a snapshot of his equity graph during that time period.

joe-profitable-trader-2ndskiesforex-equity-graph

Now before we analyze his performance since then, I’d like to point out the stats and highlights:

Total Profit/Loss: +22.25% (shown above in equity graph)
Avg. +R Per Trade: +3.23 (image below)
Total # of Trades: 149 trades (image below)
NOTE: 149 trades over 4 mos = 37 trades per month – try getting that many trades and feedback trading pin bars and confirmation price action signals)
% Accuracy: 33.6% (image below)
Profit Factor: 1.63 (image below)

joe-profitable-trader-2ndskiesforex-avg-r-per-trade
Risk of Ruin: ZERO (image below) NOTE: If you do not understand what the risk of ruin statistic means, click here.

joe-profitable-trader-2ndskiesforex-risk-of-ruin

Instrument Performance: Total of 5 instruments that gained +2-5% profit, while only 1 instrument with a 2% dd (image below)

joe-profitable-trader-2ndskiesforex-instrument-summary

Risk Management:  .5% risk per trade (which showed excellent discipline here)
Total Return: +44R!

Summarizing Joe’s Trading Performance

When you examine the above statistics, Joe performed exceptionally well and had a fantastic quarter to end the year. In fact, his +22% gain over this time period would have beaten out most hedge funds yearly performance, so kudos to Joe.

And Then…The Drawdown

While Joe beat out most hedge funds last year, this year has started on a different note. Since Jan. 17th, he’s down about 11% (see below).

While some things in Joe’s life has changed, and had some negative effects upon his trading mindset and performance, something else seemed amiss behind the night and day change. Joe reached out to me to see if we could do another Skype session and analyze his performance, so we dug into the numbers.

Now tell me what seems out of whack below with the stats:

Total Profit/Loss: -11.45%
Accuracy: 13.9% (image below)
Avg. +R Per Trade: .99R (image below)
Profit Factor: .16

 

As you can see, all the stats are down, but which ones stand out the most? The accuracy being down isn’t helpful, but what is more damaging is his Avg. +R per trade went from +3.23 to .99! That is a drastic difference.

Regardless, accuracy is always in flux when it comes to performance. % accuracy usually operates within a range for traders. It never stays fixed from year to year. So if you’re 54% accurate in one year, the chances of you ending up 54% accurate in the next year is slim to none – don’t bet on it happening!

When I saw Joe’s Avg.+R per trade was down, I immediately started to wonder ‘why‘? If accuracy goes down (it happens) it will obviously affect your overall performance. But why would Joe’s Avg. +R per trade go down? Why would a trader be getting less per trade then their past 149 trades?

There could be many reasons ‘why‘, but to name a few:

1) you’re taking profit too early/earlier than you were before
2) you’re not feeling confident, and thus trying to close any trade for profit instead of letting it run

I could honestly list a litany of reasons, but the summary tab (which analyzes performance per instrument) was the most revealing (see below):

First off, his biggest losing instrument was the NZDCAD which accounted for 40% of his total losses! It’s important to note Joe wasn’t even trading the NZDCAD in the prior 4 months. So he was including a new trading instrument into his trading plan.

Upon further questioning, I uncovered another ‘reason‘ why his performance had slipped so much. Joe had developed a bias on the CAD as a whole. He felt the CAD was about to move into a place of strength, so was bearish on any XXX/CAD pair across the board, including the NZDCAD.

Despite losing every trade on the NZDCAD (10 total), and the price action charts continually ranging or climbing, he held onto his bias and was continually shorting. This obviously had a negative affect upon his performance (holding onto a bias, regardless of what the charts are communicating rarely ever works).

Accuracy Gaining/Declining Shouldn’t Affect +R

Accuracy going down shouldn’t translate into you to going for much smaller targets. Your overall +R per trades should remain stable regardless of you performing well or not. If you consistently go for +2R, winning and losing shouldn’t change this.

Now there were a lot of other metrics Joe and I went through on our private skype call, but two things that became evidently clear were:

1) Joe had made some major changes to how he traded, and

2) Joe needed to have that skype call with me.

This is why I cannot over-state the importance of having a trading mentor. And it’s not just about having a trading mentor, but about having one who can look at your individual performance, and help you see what you’re missing that’s causing you to not get the maximum profit out of your skills and price action trading.

This feedback model I have with my students has been a game changer. I’ve turned break even traders to become profitable traders. I’ve turned losing traders into winning traders. I’ve helped students like Joe spot major issues during a draw-down, and help them correct course. If Joe hadn’t reached out to me, he could have easily kept trading and losing more money.

trading mentors 2ndskiesforex

Hence you have to look at what is the feedback model you’re getting from your trading mentor, and how much can that change your performance. If you’re not getting any analysis and feedback from them, then your trading mentor is just an information dispenser. And without analytical feedback, how would you ever know what mistakes you’re making, and how to correct them?

Thus ask yourself – how valuable would such feedback be for your trading to have an analytical session with your trading mentor digging into your performance, and finding patterns in your trading and numbers you didn’t even know existed?

Is that worth a few hundred dollars, let alone being taught the skills and trading strategies to make money?

In Closing

With that being said, if you’d like to learn how to become a member of our price action course, where you’ll get this type of feedback, along with access to our members market commentary & trade ideas, members trade setups forum, and over 60 hours of trading videos and lessons, click here.

Please make sure to leave a comment and share this with anyone you think will benefit from this.

Until then, I hope you’re seeing real change in your trading performance and mindset.

19 Trading & Life Lessons for 2019

I know, it seems like we’re well into the new year. But I just completed my Losar, which is the Tibetan new year. The Tibetan Losar is similar to the Chinese New Year as it comes in early February. 

However, Losar tends to be slightly different. Leading up to Losar, there are generally 3 main things you focus on. They are:

1) Practicing (meditation, yoga, martial arts, etc) + raising your energy (cleaning up your house, working on uncompleted projects)

2) Clearing any debts you’ve accumulated over the last year

3) Reflecting upon the lessons from last year so you can move into the next year clearer and wiser

It is this last experience I’d like to share with the hope that you become more successful in trading (and life as well) for 2019.

Let’s jump in…

Lesson #1: Wisdom and Confusion

Over the last 10 years, I’ve lived in 5 countries, learned 2 new languages, and visited over 40+ countries.

If there is one thing I’ve discovered from all my travels, observing how other cultures live, think, what they value, etc…I’ve seen that every culture, every family, every individual has wisdom and confusion. I’ve yet to meet someone across all my travels which has invalidated this theory. The bottom line is, unless someone is enlightened, they will always be a mixture of wisdom and confusion.

When you realize this, you’ll understand how there is no perfect ‘system’ (politically, economically, socially, etc), and there is no perfect country to live in. All are based on people that have wisdom and confusion, and thus all have their strengths and weaknesses.

This is a very powerful stance to take because it means you can no longer completely discount certain things, like capitalists do to socialists (and vice versa), or republicans do to democrats (and vice versa). Imagine what the various political/cultural/religions divides would be like if both sides of the isle took this stance.

From my experience, generally problems start to occur when you think that one person/system/religion (or yourself) is either all wisdom, or all confusion.

For 2019, try taking this approach to all people, and see how it changes your experience of them. My guess is you’ll find yourself being more open, relaxed and flexible in your thinking.

Lesson #2: “Avoiding Negative People”

Along those lines, I’ve recently seen this phenomena of people saying “I’m avoiding negative people“. This kind of thinking is both helpful, and problematic when you really understand it.

The whole concept of ‘avoiding negative people‘ actually has some wisdom as people can be quite ‘negative’. By and large, most people’s brains are wired so that they will have 5 times more neural cells for noticing the negative vs the positive.

That can be a problem if every 5 out of 6 thoughts you have about yourself/others is negative. How can you build real confidence in yourself if your self-talk is constantly negative? How can you build the traits you want if you hang around a lot of people who 5 out of every 6 statements about you/life/success is ‘negative’?

You can’t. This is where the wisdom of ‘avoiding negative people‘ comes in because you’re trying to rebuild your belief system, self-image, and positive habits.

The problem though is thinking this approach of ‘avoiding negative people’ is a be-all-end-all approach. I recently read a tweet from a trader friend (whom I like and appreciate). Here is what they posted:

misunderstanding-negative-people

Akin to point #1, (IMO) this tweet has a mixture of wisdom and confusion. Why?

First off, you cannot avoid all negativity in life. It’s unavoidable! People (including you) at some point will go negative. If you tried to avoid all things negative in your life, you’d be living in a bubble and never interact with anyone. And I’m not sure how you can be a mentor to anyone if you hold fast to this approach.

The whole basis of any teacher-student relationship is taking the student from confusion/negativity to wisdom.

With that being said, how can you be a trading mentor if you’re cutting out all your students who go negative one time? If you did that, you’d likely have no students. So this approach really lacks vision.

Along those lines, ask yourself about those in the military who went to fight the Nazi’s. What would the world be like if they all avoided negativity? Who would take on those battles, make those hard choices, sacrifice their lives for a better good?

Another major problem with this approach is it assumes that you are the ‘wise‘ person, and others (who are negative) are ‘confused’. IMO, this is a pretty arrogant position to take when you really think about it. Maybe your level of wisdom is another person’s level of negativity. Maybe someone much wiser than you would view your beliefs as ‘negative’. So what then? Should they avoid you?

When you really examine this approach, you realize it has its limitations. It has both wisdom and confusion. Can you see how this is helpful and hurtful as an approach?

Lesson #3: Understand Principle & Function

This brings me to my third lesson – understanding principle and function. Principle relates to the basis/fundamental understanding of something and what its founded upon. They explain the how/why things work.

The method of ‘avoiding negative people‘ is based upon the principle that you/others will often lean towards a more ‘negative’ way of seeing things, especially if your brain is wired that way.

Function is having a clear insight as to when this approach/method/practice is useful, and when its not. My guess is the author of this tweet at some point in their life (at least before this tweet) was ‘negative’. What if someone much wiser than them wanted to help them, but decided to ‘cut them out of their life the moment they went negative‘? How functional would that be? How would people ever really grow, or get help from others?

When you realize principle and function, the idea of ‘avoiding negative people‘ or any other method becomes more appropriate in specific situations/times, and completely misunderstood in others.

Hence learn to see the principle and function in your training, growth and development (in all things you do) and you’ll find yourself using the right tools for any situation. Using the wrong tools at the wrong time often creates more problems.

NOTE: this is not something I created – the concept of understanding principle and function. It’s a particularly buddhist approach to training and teaching. It’s just been a major lesson I’ve had to really work with this year.

4) Find Somebody Wiser/Kinder/Clearer Than You

I think we can all agree there is someone out there in the world who is much wiser, clearer and kinder than we are. I also think if you are going to be any kind of teacher/mentor to others, you also need to be a student as well. Not only does being a student help you fully understand the teacher/student relationship, but it always means you’re no longer taking your mind/thoughts/ideas as gospel. It means continually exposing yourself to someone whom you trust to give you a less biased view of yourself, and point out any confusions you are missing.

I feel very lucky. 19 years ago I met my current buddhist teacher, and have been with her since I made a commitment to be her student. Yes, I’ve taken teachings/trainings from other buddhist Lamas and masters, but she will always be my ‘root‘ teacher. I’ve seen her continually grow and evolve at a pace and magnitude I’ve never seen anyone else do in my life, and have thus committed to being her student my whole life.

In essence, we are all students in life, and there are people out there who can help us become a better version of ourselves right now, while also helping us see our own confusions we are currently missing (trust me, they are there).

Hence, find that person who a) embodies something better than you are now, b) communicates in a way that makes intuitive sense to you, and c) is someone you want to train with (and wants to train you). My guess is when you do this, you’ll find yourself constantly growing, and being challenged to become a stronger, clearer, wiser version of yourself.

5) Building Bridges

The one thing I love about trading is it’s apolitical, non-religious, and doesn’t care about gender. I love the fact that I have students from every religion, across 60+ countries with diverse political beliefs. When people come together for a common goal, our differences aren’t the focus, nor what divides us.

Now with the current buddhist school I’m a part of, we have what you’d call a ‘senior student’ group that you have to complete practices and trainings for.

We recently had a student from Iran who grew up in a Muslim faith join our group. We have no judgments about him, his Muslim practices, faith, or traditions. We appreciate him for who he is and how he relates to us, not what we agree or don’t agree on.

By doing that, we’ve built a bridge between our religions, regardless of our differences. Imagine what the various political or religious conflicts would be like if people didn’t use those differences to see what’s ‘wrong’ with others beliefs?

Imagine what kind of personal, cultural and societal bridges we could build when we stop dividing ourselves from others simply because they hold a different belief system? What if we simply appreciated their good qualities and then looked for common ground?

Over this last year, I learned that when you do this, you build bridges in ways that allow us to work together for common goals, which tends to make us stronger as people.

6) Discipline Has A Momentum. So Does Its Opposite

As a whole, I generally consider myself to be a disciplined person. When I was 11 years old, I got my first job as a paper boy. Keep in mind, this is a job that has no days off. Papers are always being delivered every day, regardless of the weather, health or holiday.

I grew up in Chicago, and we can have some harsh winters. My job consisted of getting up at 5:30am before school started, so I could roll the papers, rubber band them, and put them in a plastic sleeve (if the weather was wet or snowy).

I can remember many days being sick with 100+ degree fevers, and yet still going out there on my bike. And if there was too much snow, I’d have to venture out on foot carrying over 35+ papers around my neighborhood to deliver them on time.

This was hard as a kid, especially getting all this done before I went to school, but I learned the power of discipline. I learned in those early years that what I thought were my limits, were just illusions in my mind. This has become a valuable resource and wisdom for me when I often think about not practicing, quitting, or taking the easy path out.

In trading, you will be tested, particularly in the first stage of trading to see how strong your discipline and level of commitment is. Just like the space shuttle spends the majority of its fuel trying to build enough momentum to leave the Earth’s gravity, so too will you spend a lot of energy trying to leave the gravity of your current habits, conditioning and limiting beliefs.

Hence cultivate discipline, and accumulate it over a long period of time. My guess is you’ll find yourself becoming more confident day by day  that you can reach your goals in trading, and life as well.

7) What Habits Are You Perfecting?

I want you to think about the most important precept of neuroplasticity: neurons that fire together, wire together.

In essence, what you continually think about, and wire together, becomes a habit in your brain, and thus tends to dominate your life.

If you think about what revenge trading is, it’s simply you taking revenge on yourself for making a mistake. If you continually do it again and again, you’re simply perfecting the habit of revenge trading, anger, and punishing yourself for making a mistake. Your creating the very problem you’re trying to stop (anger, frustration, revenge trading) by simply making those experiences become habit.  Hence you’re using neuroplasticity to become a losing trader.

People often think the actions they take is the basis for the habits they create, but I think traders and people also forget that what we continually think, and say (out loud, or internally) also creates habits, beliefs and neurological networks we’re vulnerable to repeat.

So examine your self-talk in trading, and notice the ‘quality’ of it. Notice your speech (internal or external) about yourself and others.

Hence take some time to reflect upon what habits you have created around trading. Just look to what you’ve been repeating the most. Whatever you repeat the most is what you’ve been perfecting. When you do this, my guess is you’ll find you’ve been much more responsible for your current struggles than you realize.

But not to worry, this is a good place to be at, and often is the starting point to making real change in your habits, skills and trading mindset.

8) Being Stuck Often Means You Have to Go To The Next Level

In the early summer of 2000, I was living out of my car – a black 2 seater Miata (man I loved that car). But this was not a happy time. I had less than $3 to my name, no home, no job, and had lost most of my friends to some dark circumstances.

I was stuck in a bad place. And on one of those cold late nights, trying to sleep in my car, I eventually had enough. I threw in the towel to the way I was living, and made a commitment to really change my habits.

I vowed to stop drinking/doing drugs, eat healthy, get a job, and start some sort of mind-body training (I first found yoga). I was tired of suffering in the way I was, and made a commitment to never put myself in a situation like this.

Lo and behold, a few days later, after showering in the local free gyms, I got a job. In a strange twist of irony and humor, it was at a brewery, but I didn’t drink while I worked there as I kept that commitment.

I eventually saved up enough to get a 1bdrm apartment in a shitty neighborhood where resident on the building spoke another language, and some of those ‘residents’ were cockroaches. However, I felt that was my cross to bear for getting myself in that situation.

Less than a month after I made this commitment, I was introduced to my current partner who had just started a teacher training program in yoga and meditation. In the blink of an eye, everything changed.

When I look back in that period of my life, I failed to (at that time) realize how stuck I was in some really bad habits (which landed me where I did). The dark/stuck place I was in, was really the universe’s way of saying “hey, you need to evolve, you need to go to the next level.“

Since then, every time I find myself stuck in a particularly situation I can’t seem to break the cycle of, or get out of, I look at my current life and see where I haven’t evolved. Sometimes just evolving in one area of your life helps to unlock the next door. And even if it doesn’t solve your current problem, you’ve raised your energy, and that tends to lead to better situations, connections and growth in your life.

So the next time you find yourself stuck (in trading, work, life, etc), take a step back and reflect upon the areas of your life you aren’t evolving, and see where it leads.

9) Breaking Big Goals Into Small Steps

How many new years resolutions have you failed to accomplish over the last 20 years? My guess is many. Did you know that those who sign up for a gym membership in January from a New Years resolution will more often than not stop attending the gym within 3 months?

New Years resolutions fail for so many reasons, particularly because you’re making big goals that are too far from your current level of skill, habit and mindset. Yes, it’s important to have big goals, but none of them matter if a) you don’t achieve them, and b) break them down into smaller steps.

Nobody sets out to climb Mount Everest in a year without ever climbing smaller mountains first. The same goes for trading.

So if you really have the goal to become a profitable trader, start with some smaller goals first. Start with the first stage of successful trading – consistency, and break that down into the small steps you’ll need to take to get there. Only when you’ve climbed one mountain can you make goals and aspirations to climb to the next peak.

Hence ditch the fruitless New Year’s resolution. The numbers are against you. If you want to meditate every day, try meditating for 2 days in a row, then 3, then 4, then 5, until you can get to 7. Then try for two weeks, a month, and several months.

Do this enough, and in no time, you’ll have built the habits to accomplish your goals.

10) Big Journey’s Are Rarely Ever A Straight Line

Most likely, you’ve never heard the name Massimo Bottura, or Osteria Francescana. Osteria Francescana was rated the best restaurant in the world for 2018 and Massimo is the chef/brainchild behind Osteria Francescana.

If you watch the Netflix series Chef’s Table (which I highly recommend), Massimo was episode 1. You learn about his success, about his 3 star Michelin rating, and about how many chefs and peers worldwide consider him to be one of the greats. If you were to learn about all his accomplishments, it would be hard to miss the most important part of his story – his struggles, failures, and journey along the way.

Even after finding his passion in cooking early on, Massimo had a long road to becoming one of the best chefs in the world. He had to apprentice for a long time, working long 10-14 hours per day for years on end. He had to study with many mentors and endured a lot of challenges before he could even open his first restaurant in Modena, Italy.

However, even after training for years on end with all the experience in the world, his restaurant struggled immensely. His style of cooking wasn’t well received, and he was going bankrupt trying to keep the restaurant open.

Just when Massimo was about to give in, his partner (and now wife) said “give it 1 more year. If it doesn’t work, we’ll close.” Keep in mind, Massimo had already sold everything he owned just to open his restaurant!

About a few months later, there was a really bad accident on the Italian highways near the Northern part of Italy. After being stuck in traffic for hours, a man decided to take a side route, and ended up in a small Italian town.

Hungry after a long trip, he decided to eat at ta small restaurant he’d never heard of before. It just so happened to be that this hungry man was also a food critic for a major food magazine. By the time he was done, he was completely blown away by the chef’s style of cooking, which was night and day different from most Italian cuisine.

He decided to write about his experiences at a restaurant called Osteria Francescana. In that moment, lightning had struck, and it changed the course of Massimo’s career forever. While Massimo’s worldwide success happened over a few short months, the journey there was hardly short, nor straight.

When you take a deep look at those who’ve become successful in their careers, you’ll find none of them built success overnight, nor in short order. They’ve all had to work for years at their craft before they had their breakout moment, and that path from start to success was never a straight line.

So give up the fantasy of trading and becoming a millionaire over night. This is not something to fear, but to celebrate. It’s what makes the journey, and experience of success even better than you could imagine.

11) The Best ROI Trade Is To Invest In Yourself

If there is one lesson I could go back in time and teach to a younger me, it would be that the best ROI trade out there is to invest in yourself. Everything begins, and ends with you, your health and mindset. Those 3 variables determine what you think, decide and execute every day. It shapes who you surround yourself with, what support they offer you, what beliefs you share, what qualities you enhance them with, and they you.

It was 19 years ago, shortly after living out of my car, that I really invested started to invest in my health and mindset in any meaningful way.

Since then, I’ve:
-Paid for over 150+ weekend retreats
-Taken about 20+ online training courses is various skills that I needed to work on
-Read on average one book per week for the last 7-8 years
-Done about one 7 day pancha karma retreat (healing/detox retreat) per year for the last 8 years
-And continually pay to keep my body healthy through accupuncture, ayurveda, chiropractic adjustments and exercise

I’ve realized the most important thing I could invest in, is me, my health and mindset. I’m not saying you only have to look out for numero uno. Having a positive impact upon others is important. But you won’t be of any help to yourself or others if you don’t care for you health and mindset.

Hence ask yourself “What am I doing this year (activity, or training wise) to invest in me?” What are skills you want to build? What experiences are you embarking on that will enrich your life?

Take a moment after reading this article, and start really thinking about what you want to grow into this year. I’m not talking about the ‘things’ you want to buy. I’m talking about who you want to become as a person. Figure out what those are, then find ways to invest in them.

I’m guessing once you do, you’ll find it to be one of the best investments and trades you’ll ever make.

12) Making Money Doesn’t Make You A Wise Person

There seems to be this major cultural ignorance, that people who have made a lot of money are also ‘wise’. Wise as in they know what’s best for government, know what’s best for the economy, know what’s best for society, technology, your life, etc.

People seem to equate financial/business success with ‘wisdom’. This is a really strange phenomena because its implicitly admitting we value money above all, and that if you make a lot of money, we should listen to you on all kinds of subjects.

Making a lot of money just means one thing: you’ve learned how to make a lot of money. History is heavily littered with people who made vast sums of money, had massive success in their business/craft, but were miserable in life.

This whole problem has also entered the trading space with trading mentors. They seem to get some sort of success in trading, or business, and are now doling out advice on twitter like a life-coach.

Success in business or making money means just that (success in business/making money). It doesn’t make you some wise person who has clarity or insight into the human mind, what makes people happy, or wiser.

Know the difference.

13) Concept Is < Direct Experience

There is a fascinating book ‘Altered Traits: The Science of How Meditation Changes Your Mind, Brain and Body‘ by Goleman and Davidson. They had spent years testing the brains of experienced meditaters from various practices, traditions and experience.

However one particular subject caught their eye.  His name is Mingyur Rinpoche, and he’s the one person they tested who has spent spent more hours in meditation practice then any other (62000+). To put that in perspective, that is the equivalent to meditating 8 hours per day over 20 years, without ever missing a day!

Goleman and Davidson tested him during an experiment where he was to spend one minute focusing on compassion, and then rest his concentration and awareness for a short period of time.

His EEG activity (Electroencephalographic) had shown something the scientists had never seen before: high amplitude gamma waves, the strongest, most intense form of neurological activity. Gamma waves are the fastest brain waves, and occur when various regions of the brain are working in sync.

Ever have that sudden ‘aha‘ moment where everything clicked and came together? Most likely you’re experiencing a gamma wave. However for us mere mortals, these last about .5 seconds. Contrast that to Mingyur Rinpoche where they lasted the entire minute (while he was focusing on compassion).

Now keep in mind, these authors (and the other researchers they included) are ‘experts‘ in studying and understanding the brain. And yet, regardless of their high IQ’s, when they had to think about what Mingyur’s state and consciousness was like, this is what they had to say:

“We can only make conjectures about what state of consciousness this reflects. Yogis like Mingyur ‘seem’ (my emphasis) to experience an ongoing state of open, rich awareness during their daily lives, not just during meditation.” Source: Chapter 12, Altered Traits.

Notice how they are openly admitting their own limitations in attempting to understand what Mingyur’s state of awareness, clarity and insight is like during these states?

What they are implicitly admitting is, regardless of how strong your intellect is, to understand something ‘conceptually‘ is nothing compared to having the direct experience. Those ‘experts’ in the brain are completely powerless to fully understand Mingyur’s state of clarity, mindset and awareness.

This should help you come to a very important conclusion and realization:

Concept is < Direct Experience

14) Doing What I Was Trained To Do

On Monday, April 16th last year, around 8am, I had missed a call on my cell. I was in the kitchen making tea and getting read to start work. A few minutes later, at 8.04am, I got a text message. It read: “I need to talk to you asap, please call me.”

It was my sister. I called on the quick and the first words out of her mouth were “Dad’s gone.”

After spending a while on the phone, finding out what happened, and getting a flight, I did what I was trained to do (as a buddhist). I sat in meditation, then did practices for my dad.

I remember the scene very clearly. It was winter with lots of snow outside on the treetops and slightly cloudy. I looked outside my office into the vast space across the nearest mountain top to the east, and…just…sat.

My dad and I had a ‘complicated‘ relationship. I eventually made my peace with it, realizing our relationship would never be what I had envisioned between a father and son (does it ever???). But I had accepted it, and him for what he was…a mixture of wisdom and confusion, with definitely a lot of confusion.

I hadn’t seen my dad in months, and his last text msg to me was “uh rtrbnot, biilb, hybrid yy, we isthat, we.” When I got this, I thought he had just accidentally butt-texted me, so didn’t pay any attention to it. Who would think that was an actual message?

But when I sat there in meditation, I started to experience some regret for not texting back. Maybe he was trying to contact me, but was losing his faculties? Maybe he was reaching out, but couldn’t use text well?

When I sat there, a whole range of emotions and thoughts came up, including many, many tears. But instead of getting into the emotions specifically, I just sat there in the raw energy of them. It felt like I was on fire. It was both painful, and highly energizing to sit in such intensity, without making them mean anything about me, my dad, or our relationship.

I did what I was trained to do, and I’m glad I did, because I could have easily fallen into a deep cavern of regret, frustration, anger, or whatever about his passing, me missing his last text, or not seeing him before he left.

A few days later, there I was, standing in front of my dad, in his casket, the life gone from him. He looked like him, and yet not like him. It was kinda surreal. When I said my goodbyes, I left him one of my main malas, which I had chanted 100’s of thousands of mantras with over the years. I said my prayers for him, and shortly after, he was buried.

When I came back home after the funeral, I felt a big vacuum. My dad was there for the 40+ years I’ve had on this planet. Now he was gone, and there was nothing I could do about it.

But while feeling this giant hole and vacuum, which felt very raw and open, I also felt the world, there in every moment, trying to fill up this hole…with life.

Life is pain and joy. It’s loss, gain, and everything in between. There are many ‘initiations‘ we go through in life (love, relationships, success, failures, death). It is during these moments, some of the most intense ones you’ll ever experience, that your training and mindset will be tested.

That which you are most trained to do (or most wired to do), will in most cases, be your dominant response.

Hence ask yourself, when the really intense moments in trading manifest, how strong is your training? What thoughts/actions do you default to? Is it something you can rely upon, or will it hurt you in such moments?

15) People Are More Complex Than You Think

One of the really interesting moments for me after my dad died was spending time with my family, and all the things we talked about regarding his life. I’m not sure why families do this, but often times, people reserve certain ‘details’ about others until after they die. And to no surprise, my family did just that.

I had known my dad was taking medications for years due to his declining health, but I didn’t know the extent to which he was. I also learned that from 60 yrs on, he was taking a steroid daily. Now if you know anything about steroids of any kind, they’re super intense, and are basically a last resort to stimulate some functioning in your body you can’t do naturally.

Sometimes they can be helpful, sometimes not. But one thing they are for sure is ‘mood altering’. So for the last 20+ years of my life, my dad was on a drug that likely affected his thinking, moods and mindset.

Which made me ask the question:

“How much of my dad was I really relating to these last two decades?”

I’ll never know, but the very question created a space for how I felt about my dad. Maybe all those times I felt he was being unconscious, highly moody, angry, loud, blurting out, etc. were actually caused (in part, or wholly) because of his medications.

Maybe if he wasn’t on them, he’d be a different person. I’m not sure I’ll ever know, but I know people who’ve been on meds, and who they are without them can be a completely different person.

I also learned many things about my dad in terms of how he dealt with tragedy, and losing a son who died on X-mas eve. I never got to meet this sibling of mine as he was before my time, but in learning how my dad responded to it, I can see a lot clearer why he was the way he was.

One thing I learned in 2018 is that people are often more complex than you think, and rarely are they ever ‘black and white‘ when it comes to their emotions, personality, and mindset.

And by understanding people are more complex than you often perceive, maybe, just maybe we can hold a little more space for them. Most likely, people are more complex than you think they are. And that accounts for what you’re perceiving about them as well.

16) Generosity Is A Wisdom

As I said before, there are traits and behaviors I learned from my dad, many of them being negative, but also some really positive ones as well. There is one thing my dad had down pat, and that was generosity.

My dad’s parents were super poor, and came from very hard conditions. My dad grew up in the streets of New York in a rough neighborhood. He saw very well how hard the poor people worked to get out of their situation. He also noticed how they struggled just to survive.

Because of this, I have probably a 1000+ memories of growing up in Chicago, and us pulling up to a stop light, and seeing someone on the side of road in -20F weather. Before we’d even get to the stoplight, my dad was reaching into his pocket to grab what few dollars he had. He’d open the window, call to the person, all while traffic is waiting behind him, and give them whatever money he had, suggesting they get some food and stay warm. He’d wish them well, and then we’d continue on our travels.

Often times, after this, my dad would say something like, “my god, it’s so cold out there, how are they surviving?” or “how can a country so wealthy leave people like this?” To my dad, it confounded him how we could call ourselves the ‘richest country in history‘, yet not take care of our own people. I too have pondered this question for decades, and only have partial answers.

I learned very early on from my dad that generosity is a wisdom. It’s a moment in time where we are not thinking about me/myself/mine. It’s a moment we’re letting go of that obsession, and thinking about the well being of others, and actually caring for their condition.

It seems we could use a little more of that spirit in the world today (generosity/thinking of others). It doesn’t have to be money, but could be time, energy, or just listening to someone who needs someone to talk to.

Hence, try the practice of being generous to someone (in any fashion) 1x per day for the next week (even if it’s only for a moment), and see how it feels.

17) Trading May Not Be Your End Game

I’ve been trading for over 19+ years. I’ve had 2ndSkiesForex for over 11 years, been practicing buddhism for 19 years, and only one of those can I confidently say I’ll be doing until the day I die (any guesses?).

Why am I saying this? I’ve taken on big projects that have succeeded well over a decade, and there are two things I’ve really experienced over these last two decades:

1) I’ve evolved as a person
2) With that evolution comes changes in what I’d like for my life

As I’ve gone through my physically unstoppable 20’s, worked like a madman and started several successful ventures in my 30’s, now that I’m in my 40’s, I’m much more aware of my mortality, and how my values are changing.

I’ve had periods over the last two decades where I’m not trading for a month or longer. And most of that time, I felt like I was missing something. Not an addiction, but a skill and challenge. When I’m not involved in the markets, something feels off.

However, I cannot imagine feeling the same in my 70’s, or 80’s. At some point, trading will not be there, and most likely won’t in my end game. I also don’t imagine being a trading mentor in my last days.

What I’m trying to say is, while right now, you may be uber-passionate about trading, and want to trade full time for years on end, who you are in 10 years from now ‘hopefully’ will be different. And along with becoming different, your values change. How you value trading now might not be what it is in 10 years.

Trading may not be your end game. It may be simply a stepping stone to something bigger, some future which you cannot imagine right now. Be open to that possibility, and avoid looking at any failures in trading as life or death. Maybe you’re on a path to a higher peak.

18) The Training Never Stops

I was recently wacthing the Tom vs Time series, which is about one of the greatest competitors of the last 100 years, Tom Brady. Whether you like him or not, you cannot deny his accomplishments and competitive fire. Tom is now 41 years of age, and has just won his 6th super bowl!

He’s an elite athlete in his own sport and position, and yet, after all the skill, knowledge and accolades he’s acquired, he still does something fundamental every day for 8+ months a year. He trains!

I think many struggling traders have this delusion that training and practice isn’t important, that once you are successful, you won’t have to practice or train any more. But any long term athlete, musician or trader will tell you, the training never stops.

There is no athlete that is playing competitively at a high level and is not training. There is no musician who is playing at a world class level who is not practicing their instrument week in, week out. And there is no profitable trader who isn’t doing their homework, reviewing their trades, and constantly looking for an edge in everything they do.

Training never stops. There is no arrival point where we no longer have to practice. Hence ditch the idea that at some point when you’re making money trading, that you won’t have to do any more work.

The work never stops.

19) Try To See People’s Goodness

There is one astounding fact about your brain (including mine) which continues to baffle me, yet explain a lot of world around us. It’s the fact that you/me/others have about 500% more neural real estate towards perceiving the negative vs the positive.

Chalk this up to evolution and our desire to survive as a species, but this trait of ours has run its course and isn’t really applicable in today’s world.

Regardless, if our brains are primed to see the negative more than the positive, then what does such a fact mean for how we perceive others? It means we’re most likely to notice, observe or pay attention to their negative qualities vs their positive ones with 5x’s the regularity.

This creates a myriad of problems in how we perceive others, along with what we reinforce in ourselves.

I think this 5x effect is why news organizations are more likely to publish stories which activate these neural networks. It makes them more money because it triggers more neural real estate in us, thus more likely to prompt a reaction.

I also think if we want a healthier society, we have to learn to balance these qualities out, so we’re able to perceive both the negative and positive qualities with equal skill and regularity.

Try doing this for a week, picking a few people, and notice how it affects your perception and experience with those people. It would be interesting to hear what you find.

In Closing

I sincerely hope you found some wisdom, insight and helpful pieces out of this article. As I reflected upon 2018, I see a year of growth, of great personal challenge, and laying the foundations for an amazing 2019. There were a lot of tough lessons to learn in 2018, and I hope to make less of these mistakes in 2019.

Please make sure to leave your comments, feedback and thoughts on my musings above.

Until then, may this article be of benefit to you in your trading, and life as well.

Why I’m Done With Haters

I’ve been wanting to write a mindset article like this for a long time, but a recent event has given me the final impetus to do so. The goal of this article is to be my last post to a particular group of people today affectionately known on the internet as ‘haters’. While this is not a trading related article, I believe it can be highly useful to you in terms of mindset, and what you want to avoid for yourself in terms of your own success, well being and self-image, all of which affect your trading and life.

Let’s jump in.

Why I Am Done With Haters

If you’ve ever spent time on social media, or online reading any of the comments below various types of articles and videos, regardless of the subject, you’ll find one staple – the presence of ‘haters’. To be fair, I’m not sure ‘haters’ is the best word, but for now, it will suffice.

Haters are anyone who denigrate others, tell people what they are/are not, tell people why they are wrong, stupid, etc., all the while thinking they are the wise ones, while not having an open mind to different points of view, and are simply going negative when its not necessary.

Although it may seem like there are more haters now with the presence of the internet, and the relative anonymity that comes with posting online, haters are not new to our existence. They’ve been around as long as humans have.

They are simply the byproduct of a fundamental part of the human experience whereby we express neurosis, confusion and ignorance. As long as those exist, there will be haters. And as long as you are not a hermit living in isolation, you will encounter them regardless of what you do. There is no way around this!

When you have a social media account with lots of followers, or post things online, you will without a doubt run into haters.

Enter Vinelco (aka James Peterson)

About a week ago, I got the following comment on my YouTube channel (click to enlarge)

james-patterson-comment-1

First off, why is this person making comments about my traders mindset course (via a video) regarding my NeuroTrader partnership and hedge fund trading program? What does their comments about my traders mindset course, or me being a Buddhist have anything to do with this video?

Never mind that incongruency, but another question comes to mind…

Why is this person talking about meditation and vipassana retreats when my traders mindset course is 18 lessons on building a successful traders mindset? Yes, there is a 12 lesson meditation series in the course, but that is in addition to the traders mindset lessons.

Clearly this person hasn’t taken my course, so why is someone without direct knowledge of my course claiming they have an informed judgment about something which they’ve never taken?

Lastly, why is someone who has never had a conversation with me prior to this (as far as I know), claiming I’m not a Buddhist without providing any evidence to demonstrate their claims?

 

Along those lines, my questions to Vinelco and other haters are the following:

1) Do you really think going online, and having little to no prior communication with said person, then denigrating them, is an effective way to get anyone to take you seriously? 

2) Do you really think I’d value your opinions over others who know me well, or at least have had several dialogues getting to know me? Do you really believe that? If so, why, and if not, then why spend your time making such communications?

3) What kind of inner ecology/mindset do you have that you feel this is an effective way to spend your time and influence people in a positive way?

Thus far, I’ve never seen any ‘hater’ ever come up with any reasonable, cogent or clear response to the above 3 questions. Yet they persist in these behaviors regardless.

Moving On…

Before I share with you my response, I’d like to present you with another piece of evidence, specifically that Vinelco (on YouTube) also came onto my site around the same time, and shared his thoughts, again – not having anything to do with my mindset course (click to enlarge).

james-patterson-website-comment

Notice how they posted the exact same comment word for word? Who goes onto someone’s YouTube channel, shares their comments, and then goes onto their site, posting the exact same comments word for word? Did they write this out on some document, save it, then share it on two different channels? Honestly I don’t know, but it seems odd to say the least.

Regardless, I decided to entertain this comment, and give my response. For brevity’s sake, here are the main points of my response:

1) Why are you claiming I’m not a Buddhist without providing any evidence to the contrary?

2) Here’s why I think I’m a Buddhist (which I’ll clarify further below).

3) Why are you claiming to know something about my traders mindset course when a) you haven’t taken it, and b) the course is much more than my meditation series?

Why I Think I’m A Buddhist

First off, for disclaimers sake, I am not a Buddhist lama or teacher. I am also not a Buddhist scholar. I’m simply giving my reasons for why I feel I’m a Buddhist practitioner. I also haven’t asked my teacher this question, or looked for any formal discussion on this. I’m simply providing my thoughts on what it is to be a Buddhist.

If my teacher reads this, and disagrees, I’ll gladly accept her feedback, take that perspective on myself, and post her response in the comments below. If there is any fault in my description of what it is to be a Buddhist, the fault is simply mine, should not reflect upon my teacher or school in any way, and I take full responsibility. Here goes…

I think 3 general qualities make someone a Buddhist (or Buddhist practitioner):

1) That you work with a teacher. This can either be a type of ‘spiritual friend’, or ‘vajra master’.

2) That you minimally take refuge in the 3 jewels (Buddha: teacher, Dharma: Buddhist teachings, and Sangha: Buddhist community), and continue to take refuge in them over the course of your life once you’ve made that commitment.

3) That your training, focus and efforts are dedicated towards reducing/eliminating the causes of ignorance, confusion and suffering (either for oneself, or for oneself + others).

From my perspective, if you are doing the 3 things above, then you can consider yourself a ‘Buddhist’.

Let me briefly unpack these 3 above, and why they are important.

#1 Working With A Teacher

There are many schools and traditions in Buddhism, and they all vary in terms of how you should work/relate with a teacher. But as far as I can tell, on some level, regardless of the school or tradition, you work with a teacher.

To sum up the ‘why’, a simple answer would be:

If you’re not working with a teacher, and just going on what you think, interpret and perceive, how are you ever going to go outside of your own mind, conditioning, beliefs and confusions?

I work with a teacher, and have been with the same one for the last 18+ years. I communicate with her regularly, take regular teachings from her, let her decide what practices I should engage, then I commit to those practices till she feels I’m complete, take her guidance as an instruction, and a lot more, but this sums up my basic relationship with her.

My reasoning above why I work with a teacher is also the same reason why I think you should work with a trading mentor. How will you ever get past your habits, confusions and non-productive behaviors if you’re not constantly getting feedback from your mentor?

#2 Taking Refuge

I’ve not only taken refuge in a formal ceremony several times, but continually take refuge in what are called the 3 jewels, and will continue to do so for the rest of my life.

#3 Training to Eliminate Ignorance + The Causes of Suffering For Oneself (and others depending upon the tradition)

Unless someone is liberated from the causes of ignorance, they will continue to experience it and repeat the causes/conditions which further create more ignorance. This is what leads to the causes of suffering for oneself and others. IMO, to be a Buddhist practitioner, you have to continually train until your training is complete.

When you examine the 3 points above (which is a huge simplification), IMO it makes me a Buddhist practitioner. I don’t mean to claim this as some sort of ‘identity’, just merely a fact of what my understanding of being a Buddhist is really about.

Back to James Peterson

I wrote my response to James, and ended with a clear communication stating that I have no interest in them posting any more comments on my channel or site. You can read my full response here.

Lo and behold, James Peterson didn’t get that communication (or decided to ignore it), and a week later decided to post the following, again…both on my YouTube channel, and my website (click to enlarge).

james-patterson-website-comment-2

Looking at the above, notice how James is no longer talking about my mindset course? Dear James…if that was your main critique before, why are you not following up on this? And why are you posting on a different article than before?

Regardless, I’d like to communicate a few things here as my main response to James.

RE: “Screaming I’m a Buddhist from the rooftops…”

Really? That’s interesting, why do you say this? Reason I ask is, if you search on my site, you’ll find somewhere between 6-10 pages/articles/posts where I talk about being a Buddhist.

We have 1000’s of pages on my website, so are you saying that the 6-10 pages out of 1000+ (or <.1% of all pages) = ‘screaming from the rooftops‘? Really? Ok…that seems a little extreme.

RE: “You’re not a Buddhist…”

Really, what are you basing that on? According to my assessment of what it takes to be a Buddhist, I fit that criteria. Yet I haven’t seen you provide any evidence to the contrary.

But a couple questions come to mind for you James:

1) How many conversations/dialogues have you had with me prior to this? As far as I can tell – none! So are you really claiming to know something fundamental about me, while having no prior dialogues/communiques with me? Really? Ok…that’s interesting.

2) Along those lines, do you really think I’m going to listen to you based on your two posts, particularly where you denigrate me, belittle me, and make a lot of inaccurate/uninformed statements about me/my course?

Why would you think I’m just going to believe you, respect your comments, or even take them seriously? If you believe this, why? And if not, why make such an effort?

RE: “Listing Accomplishments/Credentials Does Not Make You A Buddhist…”

Yes, I agree, however I wasn’t listing them as ‘accomplishments‘. I was merely providing various reasons (according to my criteria) why I think I’m a Buddhist. I don’t think they make me special, nor do I view them as ‘credentials‘. I view them as facts of actions I have taken, and that they fulfill my criteria for calling myself a Buddhist.

RE: “If anything, it shows ego…”

Yes, I still have an ego, especially since I’m not fully realized in the nature of mind. But my guess is, you’re not willing to make this claim either (that you’ve fully realized + stabilized the nature of mind). If that is the case, then isn’t your ego still present in you in some moments of time?

Does the fact you were clearly told “hey, your voice is not welcome here“, and yet decide to come back, suggest the presence of ego?

Does the fact that you think I’d actually value your statements about me, despite not having any prior communications with me, suggest the presence of ego?

From my perspective, I’d say yes, but am open and willing to be wrong on this.

RE: “I’m a Follower of the Buddha’s teachings…”

Really? Please clarify where in the Buddha’s teachings it states you should go onto someone else’s website/channel, and denigrate them, while giving unsolicited advice? I’ve yet to discover those teachings, but am open to them being there.

In Summary

TBH, I don’t think James Peterson is a ‘hater‘. I don’t know enough about James to make this qualification. I use this word ‘hater’ because over the last 11+ years of running 2ndskiesforex, I’ve run into many people who have come onto my site, and acted in a similar way to James. I’ve had people call me all kinds of various names, which really weren’t kind, nor were they meant to create real change in someone.

For now, I’m sticking with the general approach that anyone who comes onto my site, tries to denigrate me in any way, without an open mind, or interested in dialoguing about whatever they feel I’m doing wrong, in a constructive manner, will not be welcome, accepted, or allowed a voice here.

My general requirements for allowing any voice on my website or social media channels are simple:

1) your tone is neutral or positive (as a negative tone isn’t constructive)
2) you are open minded
3) if you disagree, state why with facts/data (whenever possible), and if not, then explain your reasoning while being open to different perspective
4) you are willing to be wrong, and see another persons perspective, regardless of whether you agree or not

If you follow those rules, and aren’t trying to promote someone else without prior approval, your comments will be posted. If not, then you have no business posting here, and I will simply delete your comments. Thus, don’t bother wasting your time – my guess is you have better things to do!

From my training and perspective, all people, unless they are realized + stabilized in the clear nature of mind, will display a mixture of wisdom and confusion. And I think people like James who do this are (more often than not) acting from confusion when it comes to actions/communications like this.

As a whole, I don’t want anyone to suffer, and I don’t want people to experience ignorance, or suffer from it. I certainly don’t want James to suffer in any way from his actions or communications with me. I sincerely wish James be free from suffering, and the causes of suffering, just like I wish the same for you and me.

One of my main goals in life is to have a positive impact upon myself and others. I can’t do this with haters who a) don’t respect me, and b) aren’t even willing to entertain my ideas and perspectives. Thus it wastes both our time, and serves no purpose to engage with these people.

It is my hope with this article, that any/all who read it become just a little more kind, clear and aware of how they act/communicate online (or in person) with others.

I myself make mistakes, and will continue to do so, especially since I too am a mixture of wisdom and confusion. Hopefully over time, I’ll make less of those mistakes, and continue to become more free from ignorance and the causes of ignorance. And that is my wish for you as well, whether you’ve been kind to me or not, whether you’ve spoken with me or not.

Hopefully I’ve accomplished this with my post.

Until then, I’ll look forward to your comments/feedback (assuming you meet my general guidelines), and wish you good health and growth in your mindset, trading and life.

The 30 Day Mindset Challenge: Will You Succeed?

trading habits challenge 2ndskiesforex

We are on the heels of June and I’ve decided to take on a new challenge.

For the entire month of June (30 days), I’ll be taking on not 1, not 2, but 7 new habits.

I definitely like a challenge, and for me – a successful mindset requires successful habits.

Hence I decided to announce this challenge openly to you and others, sharing all the details along the way.

But before I get into the nitty-gritty details, I need to talk about habits and why they are key to your brain & success.

key to profitable trading habits 2ndskiesforex

Why Habits Are Key To Your Success

For you to make money trading and achieve your goals, you’ll have to wire in successful habits.

But you currently have a problem. Your brain will do what it is wired to do most of the time (think 90+% on avg).

And your brain is not programmed to make money trading. So you’ll need to un/re-wire your current programming while creating a successful trading mindset.

Now how your brain is wired (wiring = habits) can be explained by one principle – neuroplasticity.

What Is Neuroplastcity?

Neuroplasticity is your brain’s ability to wire and make new connections. Its also the reason why you can unwire connections and bad habits.

There are two key terms for understanding neuroplasticity. They are:

1) SDN = self directed neuroplasticity

and

2) EDN= experience dependent neuroplasticity

To help you understand the above, just memorize the following statements:

1) Neurons that fire together wire together

and

2) Passing mental states = lasting neural traits

Now one thing that is implicit in the first statement is the following:

Neurons that fire apart wire apart

You’ve probably heard something similar in pop culture, such as the ‘use it or lose it‘ phrase. This statement is completely valid regarding your brain.

Habits are what you create by repetitive actions over a consistent period of time. Creating successful habits requires mental toughness because you’re fighting against your brain’s conditioning.

Once you’ve created a habit, your cognitive bandwidth is now available for other important activities.

Think of what your trading would be like if every time you spot a great trade setup – you pull the trigger without worrying about a loss. How would that help your performance on a day to day basis?

Hence your direct path to successful trading is to build successful trading habits.

habit quote aristotle successful mindset 2ndskiesforex

NOTE: If you want to learn my personal methods for wiring successful habits into your brain fast – check out my Advanced Traders Mindset Course.

Front End Work For Long Term Benefits

Building successful habits requires most of the work to be done on the front end. What do I mean by front end?

To wire in a new habit, you have to physically (and chemically) create a new series of connections. This takes (at a minimum) consistent repetition over time.

How long? For the expert at this – about 21 days is the fastest you can do this. 30 days would be more reasonable.

What if you are not working 4-8 hours per day trading at least 5 days per week?

You’ll need about 90-180 days.

From my experience as a trading mentor who’s turned many traders profitable, this is one of the biggest reasons why many never succeed. The habit wiring curve takes just a tad longer than most are willing to do consistently over time.

Do you change your pair, price action strategy or time frames if you don’t get the results you want in a few weeks or a couple of months? Do you just jump from mentor to mentor and course to course as you continue to struggle?

If so, then you have a problem because you’re changing critical behaviors before you’ve fully wired in the habit.

Hence you never get the benefits of wiring successful habits into your brain. And then you eventually wonder why you cannot trade consistently.

Sound familiar?

Thus most of the work in building successful habits for you will come in the front end. The good thing is once you’ve wired them in, the rewards (and potential upside) are unlimited.

That sounds like a pretty good trade to me now doesn’t it?

Why Delayed Gratification Is Key

In your journey to create new habits, you’ll be fighting against a primal instinct. This is via instant gratification and one reason why our brains work against us in trading.

The key is to flip the script and opt for delayed gratification. The problem for you is – in a time of instant gratification, most of what you are exposed to works against this.

The Marshmallow Test & Why Delayed Gratification Matters

 

So you have to go against the grains of every day society and culture.

The bottom line is – if you want ot succeed in trading or life, you’ll need to seek out delayed gratification. This will direct your mindset towards building successful habits over time.

As you begin to add positive habits into your life, you’l build up your self-image along the way.

Having a positive self-image will increase your confidence. Eventually you’ll start to think and believe it is ‘like you’ to succeed.

You’ll believe it is ‘like you’ to accomplish what you set out to do. This is one of the most important things you can build for your mindset.

“The habits you wire in today will become the vehicle for your success tomorrow.”

In the spirit of wanting to build my self-image, habits and mindset, I’m taking on these 7 habits for the month of June.

challenging your mindset 2ndskiesforex

The 30 Day Mindset Challenge: Will You Succeed?

For the next 30 days (without breaks), I’ll be adding the following habits to my daily routine.

Here they 7 new habits below:

1)    1hr of writing/producing new trading content per day

2)    45 pushups

3)    25 situps

4)    25 squats

5)    30 mins reading a book or article about buddhism

6)    30 minutes reading a book or article on neuroscience and/or mindset

7)    30 mins – 1hr work on the new trading applications I’m creating (will announce at a later date)

Looking at the list above, that is a lot of new habits to take on. We’re talking about adding 3-3.5hrs of work to my day every day for the next 30 days.

Normally I do not recommend taking on such a big load of new habits or hours to your daily schedule. However I have confidence in my ability to manage my time and get this done.

Will you take on this 30 day mindset challenge?

If so, I’d recommend starting with 1 habit to begin with.

Start small and work your way up. There is no point setting yourself up for failure, so work on something you can achieve. Just make it stretch your comfort zone a bit.

NOTE: For a great article about the comfort zone and how it determines your success in trading, click here.

comfort zone - challenging your mindset to succeed 2ndskiesforex

 

BTW – if some of you are thinking ‘only 25 situps per day?’, my apologies as a) I’m getting older and b) I’ve spent far too much time in the seat lately 😮

All kidding aside (partially kidding…), what new habit will you challenge yourself for the next 30 days?

Write it below along with why you want to work on this.

IMPORTANT: Make sure to work on a habit that you can control the execution of.

For example – you cannot control the market and profits. Hence creating a habit like ‘I’m going to make $5000 per day trading’ will fail because it’s based on something you cannot control (markets).

This is why you only work on habits that you can control.

Now make sure to share below what one habit you’ll be working on for the next 30 days. Be specific along with sharing what it will mean to you to build this new habit.

I’ll be posting updates on this once per week every Tuesday at 930am so make sure to check back regularly.

I’m looking forward to hearing from you. And I’m willing to bet you’ll feel like a more confident version of yourself for completing such a challenge.

Until then – good health and trading to you.

,

Setting Trading Goals for 2013

Now that 2012 is wrapping up for traders, I’m guessing many of you (like myself) are dying to get into the new year of trading.  During this time, it is a fantastic opportunity to reflect upon what successes you had last year, but also what you need to work on.
A common practice and tradition for people before the new year is to set goals or what some refer to as ‘resolutions‘.  Did you know that over 80% of all New Years resolutions around losing weight or getting into shape fail?  Similarly for traders, virtually the same amount of profitable accounts last year (avg. 28%) is virtually identical to the year before (avg. 26%).
Yet I’m willing to bet most of you made trading resolutions last year that were all designed to help you become successful.  Being that around the same amount are, it’s safe to say these ‘resolutions’ failed, so why do you think that is?
The key is around setting proper goals, for if they are done incorrectly, you will move forward without a real plan of action, just attacking the charts hunting for profits and intraday price action setups, but no real progress towards your trading.
This article is designed to share with you an easy 5 step strategy for setting proper trading goals in 2013. This is so you can make the significant changes to your trading you feel is possible.

setting trading goals for 2013 chris capre 2ndskiestrading.com

 
Step 1 – Make Your Goals Specific
If a goal is not specific, there is no way to focus on it, or take specific actions to achieve it.  Your efforts become dis-coordinated towards achieving your goal, and your energy never drives home any specific change.  Stating to yourself;
“I will stick with my trading method“ is too general and not specific enough.
Sure, your method may be to trade price action, or the ichimoku cloud, but that is too vague.  Does this mean one system or many?  Does this address risk parameters?  No.  Does it address the specific rules of your system?  No.
You have to be specific with your goals, otherwise your efforts will be scattered and ineffective.
Although the most common goals will be numbers oriented, try to avoid these typical ones below;
I want to make a 100% gain on my account
I want to make 10% profit a month
I want to make 500 pips per month
Why?
Because you cannot know what the market will bring.  You may have a goal of 20 pips per day, but what if the market is offering you 100 pips on your price action setup?  Why would you not take what is offered?
Consequently, the market may have low liquidity and be in a super small 15 pip range, perhaps waiting for a big announcement.  So why try and force more out of the market then what it is offering?
Focusing on performance means you may sacrifice technique to get there, and this leads to bad habits in trading which will cause greater losses down the line.
Instead, set some clear ‘process‘ oriented goals which focus on technique instead of result.  If you do the technique correct, and trade following your rule based system, then you trade the system as is, and build positive habits towards trading successfully.  I always suggest – focus on doing the technique correctly, and the money will come.
Some examples are;

-I will execute proper risk management targeting minimally 2x my risk on every trade
-I will stay in a winning position until my system gives me an exit signal
-I will spend 30 minutes each day preparing for my trading day, and 30 minutes reviewing my trading day
Not only are these ‘process‘ oriented goals which build positive behaviors to improve your trading, but they are specific.  Instead of saying, ‘I will use ‘better‘ risk management techniques‘, they state specifically what they are.  ‘Better‘ is ambiguous and hard to define, so how do you know if you achieved the goal?
Specific goals (both small and big) are critical because you direct your efforts in a specific direction where the goal is clear.  Each smaller goal is simply a step on the path to a larger goal and gets you that much closer.

setting specific trading goals chris capre 2ndskiestrading.com

 
Step 2 – Goals Need to Be Measurable
Along the lines of goals being specific, they also need to be measurable.  For example, maybe for the last year, across all your trades, you achieved a 1.5:1 reward-risk ratio for all your winners.  Well, with the goal of having a 2x reward-risk ratio, this is something you can measure.
You can also challenge yourself by adding a time value beyond ‘for the year 2013‘.  An example would be;

By March 1st, I will targeting nothing smaller than 2x my risk

or
By March 1st, over half of my trades winners will be 2x my risk, and the other half no less than 1.5x my risk
You may accomplish these goals earlier, but by having a goal be ‘measurable‘, it becomes a measurable indicator directly related to your goal, which will provide you with clear results and a feedback loop which communicates how you are doing, and what specifically you need to work on.  You can even get specific by making smaller measurable goals which are just one step on the way up towards your bigger goals.

small steps towards larger trading goals chris capre 2ndskiestrading.com

 
Step 3 –  Make Your Goal Attainable
Ask yourself, ‘is your goal attainable?‘  Saying you want to achieve 70% accuracy with all your trades may be difficult if you’ve never had a year (or even month) above 50%.
The questions you have to ask yourself ‘Am I prepared, capable and have all the tools needed to achieve my goals?‘
Maybe you do not even have a rule based price action system with an edge to begin with.  So how can you say you want to achieve 70% accuracy when you a) do not even have a system and b) have not tested your system on demo or live to see how it performs?
Perhaps one of your goals is to write in your trading journal every day.  Well, ask yourself – do you even have a trading journal?
First figure out what you need to achieve your goals, then determine whether you have everything you need or not.  A goal must be attainable, but only if you have the right tools in place.
 
Step 4 – Make Your Goal Realistic
It is easy to make a goal, just like it is easy to make a new years resolution.  But setting a realistic goal is a completely different thing.  Just like a goal needs to be attainable, having a realistic goal keeps you honest about where you are and what is workable to you without putting undue stress on yourself.
setting realistic goals chris capre 2ndskiestrading.com
For example, using the goal, ‘I will spend 30 minutes every day preparing for my trading day‘, what if you work 9 to 5, and your trading day starts at 5:30?  Maybe it takes you 15 minutes just to get home, so spending 30 minutes preparing for your trading day may not be realistic if you need to be trading at 5:30 when your price action setups form.
This is the failure of many exercise or weight goals.  Saying you want to lose 50lbs in 3 months is one thing, but maybe it would be unhealthy for you to lose that much weight so quickly.
The same is for trading – make your goal realistic.  If you are going to make your goal a performance number, like 1000 pips per month, yet you’ve never made over 200 pips, you may be setting yourself up for failure and disappointment which will have a negative psychological impact on your trading.
Thus, find a goal that is achievable, but will force you to work and stretch your current abilities.
 
Step 5 – Make Your Goal Timely
Obviously you will start working on these new goals beginning the new year, but what is your deadline or finish line?  Would you ever join a race if you had no idea how far you had to run?  Of course not.  Thus, not having a finish line for achieving your goals can cause your motivation to wane, or discipline to slip by taking breaks from working on your goals consistently.
Remember, the finish line is not just an ending you are moving towards passing.  It is a guide on how to manage and use your time and effort.  Most traders fail to manage their time effectively, both in front of the screen (trading, analyzing the market for setups), and away from their screen (reviewing trade journal, analyzing performance/stats).
It is common to think ‘next week, or next month I will use proper risk management, or write in my trade journal‘.  How many times have you said this to yourself, and how many times have you not hit your goals on time?
The difference between successful people and those who are not, is successful people know how to manage their time well, set small goals that lead to the larger goal, and constantly make progress towards them.  By knocking down the smaller goals, it makes the larger goal seem much more possible.
setting trading goals 2013 2ndskiestrading.com
Each step you take should have a finish line for achieving your goals, so you know how to effectively manage your time and build towards your new heights.
 
In Summary
Creating resolutions and goals at first seem simple and straightforward, especially if they are just done in your head.  But you’ve committed to becoming a successful trader.
You’ve spent money, time, and made many sacrifices to complete the journey.  Why waste that time and effort to fall short and not get the financial freedom you want?  Why spend so many hours and dollars to not get a return on your investment which is the the best kind of all – independence for both money and time?
Thus, make sure you know what you need to achieve your goals, that they are specific, measurable, attainable, realistic and timely.
I always suggest starting off asking, ‘What Do I Need To Trade Successfully‘.  This is a critical step towards achieving any goal.  But once you’ve asked these questions, then you know what you need to do and where to go.  Now you just need a map and to set your goals for getting there.
Maybe you want to achieve your goals in a few months, a year, or maybe a few years.  Regardless, you need a map, and clear goals/steps to get there, so make sure to make your plans and goals workable by following the five steps above.  Doing so is the fastest way to reaching your goals and crossing the finish line.
trading goals crossing the finish line chris capre 2ndskiestrading.com
Thus in 2013 accept the challenge to become a successful trader by working with a trading mentor, study a rule based system, do the work, and enjoy the rewards as they are more than worth it.
I’d like to end with a quote that was inspiring for me in my early years of trading from Hannah Moore:
“Obstacles are those frightful things when you take your eyes off your goals”
Kind Regards,
Chris Capre
Make sure to out my latest trading articles:
My Top Trading Mistakes for 2012
Developing a Successful Forex Trading Mindset Pt. 1
The Ideal Trader

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Developing a Successful Forex Trading Mindset Pt. 1

Today’s lesson is just to give you some brief tips on how to develop a successful forex trading mindset. Without a profitable and successful trading mindset, you will be swimming upstream against your emotions/fears, thoughts and unconscious habits which undermine your success.  Perhaps you have noticed this already in your trading, almost as if you are being kept at arms length from trading profitably.

developing a successful trading mindset chris capre 2ndskiestrading.com, forex trading strategies

Your trading mindset is really a product of three things;
1) your neuro-physiological wiring

2) your mindset or level of mindfulness 

3) your psychological conditioning

Too many traders always seem to feel it is the system which is holding them back from being profitable. Yet I teach the same price action strategies to hundreds of people, and while many are profitable, others using the same systems are not.

What is the difference between the two?  Their Trading Mindset.

So I will briefly share some key points about the mind, the brain, and how you can help develop a successful trading mindset.  For today’s part 1 of the article, I will focus on the first point, and will cover the other two in the following articles.

Neuro-physiological Wiring (i.e. How Your Brain is Wired)
When your brain changes, so does your mind and vice versa.  They are integrated and help in your development as a forex trader.   Neurons that fire together wire together, and mental activity helps to create new neural structures (positive or negative ones).  Simple unrelated thoughts (about past, present or future) can having significant effects on your trading mindset.

trading mindset neurological programming 2ndskiestrading.com

It should be noted there is no compartmentalized portion of your brain just for forex trading.  Everything in your past conditioning and wiring can and will have an effect on your trading success.

The good thing about this is – your mind is neuroplastic and can be re-wired into a whole brain state.  Any subtle changes in brain chemistry, heart rate, etc. can and will alter your concentration, memory and emotions (all critical for trading successfully).

Fantastic ways to alter your neural programming and to build a whole brain state for better performance + a successful trading mindset are a) ERT training, b) a brain gym or using binaural beats c) right diet and lifestyle.

As a whole, your brain has three fundamental functions:

1) Regulation (physiological processes necessary for survival, perception, etc. through exciting or inhibiting neurons)

2) Learning (forming new synapses, pathways and circuits by strengthening or weakening current ones)

3) Selection (working with perception and experience moving towards what is valuable or not)

These three fundamental functions are critical for all mental activity – especially in forex trading.

Regulation
If you have not taught your brain and central nervous system to relax, to breathe slowly and more deeply, your trading will likely be more emotional, panicked and stressed.  You will miss details and make irrational decisions (not trading your strategy, trading with fear, risking too much).  But you can train your brain to regulate the physiological and mental activity through exercise, yoga and breathing practices.

learning to build a successful trading mindset chris capre 2ndskiestrading.com

Learning
The best ways to accelerate the learning process is to a) work with a trading mentor, b) practice, study and train to use rule based systems, and c) to train in the markets which provide a feedback loop for you.

Selection
In concert with the learning process, your experience in the markets will help provide a rich context and feedback to help you move towards what is beneficial and valuable for your trading.  This is done by discovering what works and consistently making profits, while moving away from what does not.

Your brain has survival strategies (physical/psychological) hard wired into its cells, and these can help or hurt your trading.  It should be noted, when a survival strategy runs into a high energy (or uncomfortable) situation, the brain will create alarm signals that can and will influence mental activity.

Some of these strategies are;

1) to look for stability/solidity in a constantly changing world
2) to divide what is connected creating a subject/object relationship
3) to avoid pain/threats and seek pleasure

negative emotions in trading developing a successful trading mindset 2ndskiestrading.com

Can you see how these strategies may effect/hurt your trading?  Any of the three stand out?

Food for thought, but perhaps you can explore how they have influenced your trading. This is the first step to building awareness around what makes you tick as a trader, and what you need to work on mentally. Overcoming and transforming these obstacles can (and likely will) mean the difference between making money and losing money.

Regardless, each of these three fundamental functions and strategies will play a critical role in building a successful trading mindset.  Additionally, how your brain is physically wired will either support (or hamper) your learning process.

The good thing is, you can completely train and re-program yourself to be hard wired for successful forex trading.  The only thing missing is working with a proper mentor, a training program, and the right effort.

developing a successful trading mindset trading profitably chris capre 2ndskiestrading.com

I hope this helps gives you insights into the mind and why developing a successful trader mindset is important.

I’ll explore more in part two of this article series, so stay tuned, and happy holidays to all!

Kind Regards,
Chris Capre