1. Trading Live Online, LLC November 4, 2009 Review Trader’s Mindset © 2009

2. “Everything is psychological in terms of investing
“Everything is psychological in terms of investing. So it’s really understanding those psychological variables that are most important for winning and losing…For example, each system typically has a number of discrete trading steps that one must follow and each step is associated with some distinct psychological state. If you follow the steps but don’t have the right psychological state associated with it, you’re going to be in trouble.”
Van K. Tharp, Ph.D 1987 issue of Stocks and Commodities, excerpted from ‘The Three Skills of Top Trading’, Hank Pruden

3. Most Important Trading Asset is the Mindset
Check to see what your states of mind are at different times of your trading.
1. Out of the market
2. Doing analysis
3. Identifying trade setup
4. Order Entries
5. Trade Entry
6. In the trade
7. Trade going against entry
8. Trade going in profit area
9. Trade reversing
10. Profit taking
11. Stop Loss taking
12. Out of trade
Learn to Protect your trading capital and your Trader’s Mindset
Recognize off trading periods
Create a routine for yourself around these periods
You are the most important factor in your trading – Van K. Tharp

4. Actions 2. Doing analysis - focused
1. Out of the market - relaxed
2. Doing analysis - focused
3. Identifying trade setup – objective or opinion?
4. Order Entries – following plan or nervous
5. Trade Entry – follow plan or hesitate?
6. In the trade – relaxed, accepted risk?
7. Trade going against entry – reactive or monitoring market?
8. Trade going in profit area – anxious to take profits or let trade go?
9. Trade reversing – prompted to action or reassess?
10. Profit taking – Job well done or euphoric?
11. Stop Loss taking – Job well done or angry, frustrated, depressed?
12. Out of trade – anxious to get back in or relaxed and patiently waiting for next setup?
With the checklist above what actions are your “normal” actions that you take?
Identify areas that you need to work on and make action list of how you will accomplish it.
Use your sample sets as a tool for your mindset

5. Tips to balance mindset
Helpful Hints
1. Take a break
2. Determine if directional opinion or bias is interfering, look back at charts and trades
3. Avoid revenge trading
4. Take a break
5. Always record trades – you have to accept where you are to move forward
6. Know your trade plan
7. Get back to basics – follow a simple plan, commit to it
8. If you can’t identify why you lost or made money – you have no plan
9. Have confidence you will regain any losses.
All traders from time to time will go through challenging periods in trading. Having a plan to get through these times is a key element in getting back on track.