Lessons from the Pros

Specialty Skills

Be Cautious of Blind Spots In Your Trading Vision

Blind spots are areas, biases and beliefs that we are unaware of; and they occur in many forms. There are several types, from ones that affect your vision to those that affect relationships and even trading habits.

A physiological blind spot is a blind spot in your eye that obscures your visual field. These are caused by a lack of light-detecting photoreceptor cells on the optic disc of the retina where the optic nerve passes through the optic disc. Because there are no cells to detect light on the optic disc, then that part of the field of vision can’t be seen. The brain provides some compensation with the other eye so we don’t normally pick up the blind spot.
Here is an example:
Blind spot test
Demonstration of the blind spot

                                                                R                                                                                            L

Instructions: Close one eye and focus the other on the appropriate letter (R for right or L for left). Place your eye a distance from the screen approximately equal to 3× the distance between the R and the L. Move your eye towards or away from the screen until you notice the other letter disappear. For example, close your right eye, look at the “L” with your left eye, and the “R” will disappear.(1)

Other blind spots are a defense mechanism which prevents the recognition of the way you really feel about someone or something; because if you were to actually identify these feelings they would be too painful to acknowledge. They also may be parts of your personality that are hidden in your unconscious. They could be irritating habits like being arrogant or stingy, or they may be deeper desires or fears that are too threatening to admit because they would diminish the view you have of yourself and thereby diminish your self-esteem.

Going further, just as there are blind spots in your eyes and blind spots in your personality there are also the visual blind spots that occur when you look in your side-view mirror at the road where there is a small area just at the left rear corner where another car would be invisible.

Free Trading WorkshopThe above are just a few of the many “blind spots” that affect your ability to resonate with reality; that is, to think about, consider and see things as they are. With this in mind, there is another type of blind spot that I would like to point out. This is the “bias blind spot.” It is a cognitive bias that acknowledges the force of biases as judgement from others while failing to see the effect of biases in your own judgement. Consequently, this type of bias blind spot also extends to trading in that often traders may be unaware of that they tend to perceive others as biased, which is not necessarily a problem until we note the fact that this same individual perceives themselves as being accurate and un-biased. This type of blind spot can severely disrupt your trading because it deters you from accurately identifying your issues; those things that are either causing you to violate rules or to fail to keep trading commitments. And, on another note, people who are high in bias blind spots are more likely to ignore the advice of experts and are less likely to benefit from training geared to reduce their commission of other biases. Does this sound familiar? That is, do the instructors and instructions seem to continue to allude you and you can’t seem to “get it” or to “turn-the-corner?”

So, what are some of the ways that you can become aware of and alleviate your blind spots?

    1. Through appreciative inquiry and a gentle mindfulness of what you are doing and why you are doing it; ask yourself as  calmly and kindly as you can:
      1. What am I afraid of in my trading?
      2. What is the one thing about my trading that I least want to accept?
      3. If I knew what my three greatest issues were, what would they be?
    2. After deriving answers from honest contemplation, let it soak in for a while. Then, use trusted close friends and fellow traders to give you valuable feedback to help you “see” what here-to-fore has been out of your awareness.
    3. Be thankful and open to truthful, honest and sometimes “painful but growth oriented feedback” without judgement; just begin to observe yourself more closely fortified with this new information. It will not be a quick process but it will lead to, if embraced fully and openly, a more authentic and grounded self that is better able to resonate with reality while in the trade process.

Your trading is a serious endeavor because you are putting your hard earned capital at risk and it is critical that you provide yourself with every edge possible in the trader trenches. Just as you wouldn’t drive with blinders on, it is just as important not to trade that way. Flush out, address and alleviate your trading blind spots and support yourself in trading with a laser precision on what matters most. This is what we teach in Mastering the Mental Game online, on-location and XLT courses. Ask your Online Trading Academy representative for more information. Also, get my book, From Pain to Profit: Secrets of the Peak Performance Traders.

Happy Trading

Dr. Woody Johnson – wjohnson@tradingacademy.com

1. https://en.wikipedia.org/wiki/Blind_spot

DISCLAIMER This newsletter is written for educational purposes only. By no means do any of its contents recommend, advocate or urge the buying, selling or holding of any financial instrument whatsoever. Trading and Investing involves high levels of risk. The author expresses personal opinions and will not assume any responsibility whatsoever for the actions of the reader. The author may or may not have positions in Financial Instruments discussed in this newsletter. Future results can be dramatically different from the opinions expressed herein. Past performance does not guarantee future results. Reprints allowed for private reading only, for all else, please obtain permission.

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