Lessons from the Pros

Specialty Skills

Meditation Can Be the Medication for Your Trading

As Mike looked at the price action begin to edge toward his stop on the NQ 5 minute chart, which he used to enter his supply zone short trade, there was a distinct note of anxiety in his chest. He heard himself say, “Darn it, it’s going to take me out!” A few moments later, he felt something else – it was an urge to move his stop. Now, in the not-too-distant-past, he would have immediately given in to that urge like so many times before.  He would have moved his stop and in fact may have taken it out leaving himself highly exposed to losing much more than his rules allowed.  But, today, he took a deep breath and reminded himself to remain in the Now of the trade.  He also told himself that he must keep his focus on what matters most in order to maintain his best game at the trading platform and how important it was to manage urges that would take him out of his A-Game.  Before, he would have become frustrated, frazzled and fragmented, which would have careened him to an out-of-control state and brought on disastrous results.  What caused him to keep his cool and remain focused on what-matters-most?  Well, Mike started using meditation.  He had been practicing a daily meditation routine for about a year and it had greatly increased his ability to manage his emotional state by remaining patient and it had greatly helped to hone his focus.

Bringing your “A” game to your trading platform and ensuring that you are “in the moment, fully available, fully present and in the now” of the trade is crucial to getting the results that you want.  You’ve got to be able to focus with intention and attention to decrease the pain associated with being out of control.  There is great value in being aligned, centered and grounded in order to optimize all of your system’s resources toward seeing reality for what it is, being on the right side of the order flow, and dancing with the price action by following its lead.  Among the many ways that help you with alignment, centeredness and being grounded, few are as powerful as meditation.  Over the years, the usefulness of meditation has been scientifically documented in hundreds of studies with regard to physiological, mental, emotional and behavioral benefits.  Some of those benefits include:

  • Sharpening attention
  • Lowering heart rate
  • Lowering stress levels
  • Easing anxiety
  • Increasing patience
  • Inducing calm
  • Reducing susceptibility to fear and greed.

With consistency, this powerful practice supports the entire system of mind/body and spirit.

Meditation has covered the entire planet throughout history in one form or another with differing configurations; however there is a common theme of calming, centering, aligning and grounding the mind/body.  Meditation is a journey with no destination, a journey that enters into the depths of heart and mind to open the self to a deeper awareness and just “being.”

To be fully present and in the moment is one of the major aims of meditation.  Being fully present means the mind/body system is living and vibrating in this moment, without internal or external distractions.  Being fully present means the focus is on the task at hand while remaining on purpose, and on target.  So often while trading you are thinking about what happened in the last trade, the last hour, yesterday or what is coming up in the next few moments or tomorrow.  In other words, you’re everywhere but where you should be, that is, focused on what is taking place right now – the “what-matters-most” of the trade.  Distractions can come in the form of negative emotions like fear, greed, and anxiety, all of which can distort perception and make illusions seem real.  Consistent meditation hones an appreciation for just “being,” without timetables, goals or effort.  The central idea is to be mindful and aware of your internal/external environment by surrendering to the moment and letting things be.

Mindful meditation is promoted by John Kabot Zinn in his book, Full Catastrophe Living.  Mindful meditation involves sitting down in a chair, or on a pillow, or on the floor or standing or walking.  If you are sitting, do so with the intention of “sitting with dignity” upright.  You’ll want to keep your back straight in order to facilitate the energy flow up and down your spine.  If you sit in a chair, put your feet flat on the floor, maintaining the energy flow in a constant and facilitated state.  Now, take your attention and focus it on your breathing.  The point is not to try to concentrate energy—that would be an act of doing—but to focus the attention and let your breathing proceed naturally.  Allow any thoughts to come and go with an intention of un-attachment to any thought.  The breath is especially helpful to come back to whenever you find that you are attending to thoughts.  The breath is very important, as it is a cleansing action and oxygenates the blood stream while helping to dilate blood vessels and send more oxygen to the brain, which has a calming effect on the entire body.

It is important to be attuned to the process not as “trying” but “being” in order to allow the mind/body to resonate with the stillness and quiet.  It is said that for every hour of meditation, the body gets the equivalent of 4 hours of rest. As you breathe let go of any thought, care or issue and, when it returns, acknowledge it and allow it to be there without judgment. This may be difficult at first, but just keep the intention strong and in time, you will be able to sit in quiet stillness with only the sound of your breathing as thoughts come and go.  Eventually your ability to just “be” will become stronger and you may find you are held captive less and less by unruly thoughts.

Practice meditation at the same time everyday to help instill the habit and routine, especially when beginning.  It’s a perfect way to start your day before you do anything else.  It can rejuvenate, align, invigorate and charge your system, infusing you with a sharpened sense of attention to what matters.  It’s also a wonderful way to end the day to wind down, de-stress, realign, shed tension, calm the system, and generally defuse any negative energy that could disrupt a good night’s sleep.  A mediation break at lunch is an excellent tool to maintain balance and focus for the day to weed out distractions and remain on purpose and on task.  As you can see, any time might be the best time for you.  Additionally, you may want to develop a two-a-day practice, once in the morning and once in the evening, as a powerful way to instill and maintain a sense of calm intention throughout the day and night.  There is no set time interval to meditate but, generally speaking, 20 to 30 minutes is what many use.  For beginners, I usually suggest that they start with 5 minutes and build up to longer time frames until they are able to remain still and focused for 20 to 45 minutes.

Your trading requires the best you can give while activating and accessing all of your internal and external resources.  Trading is tough and as you meditate, with consistency, you will develop greater capacity for patience, calm, sharpened focus and being less distracted by negative emotions.  Diligent and consistent meditation will help you to reduce distorted judgment by building emotional strength and a level of detachment.  Trading is almost exclusively a mental art.  During your trading process you are preparing, analyzing, processing or executing a trade; all of which require mental and emotional tools.  You’ve got to have mental and emotional tools in your tool belt, otherwise it’s like driving without a steering wheel; you will lose your way and crash and burn without them.   Put the steering into your trading.  Ask your Online Trading Academy Representative for more information.  Also, get my book, “From Pain to Profit: Secrets of the Peak Performance Trader.”

Happy Trading.

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.