Trader Mindset: The Unconscious Factor

As a discretionary day trader, it took me some time to really understand the importance of having a proper trader mindset in order to be consistently profitable. As a former equity derivatives trader and engineer, I’ve always been more attracted by technical setups, a logical risk management approach and planning in advance, all very important things of course but not strategically important to succeed in trading.

I saw traders with a poor understanding of market structure, bad entries and illogical risk management finally succeed with apparently no possible explanation: after months of struggling and some personal experience I suddenly realize what they have that I don’t.

What is exactly a trader mindset?
Well, what I believe, based on my experience, is that if you do not understand the way your mind processes information, the dialogue between your conscious and unconscious/subconscious mind, the set of values/beliefs you’ve unconsciously built up during your entire life, the emotional triggers and why your unconscious generates automatic responses with apparently no control, well, you will have very difficult time on the way to reach success and become consistently profitable.

Let’s say that you just get stop just after the market moves finally in your direction. Observe your feelings. How do you feel? Probably not too happy or satisfied with what just happened. You have some automatic responses like frustration, negativity, revenge and anger no doubt. You know perfectly well that losses are part of the game, you read 100 times that it’s just the cost of doing business, it’s perfectly normal to have losses…but deep inside, YOU DON’T ACCEPT IT!

That’s how it works!

The reality we perceive externally is constantly filtered by our values/beliefs in order to be processed by the conscious mind; that’s because our conscious mind is physically able to process just a very small amount of info. The ways we filter information determine our automatic reactions mostly through emotions and finally our responses in terms of actions/reactions. What does make the big difference are the meanings we give to events and our reactions; respect the event itself. Perception is Projection.


So it’s strategic to understand which kind of values/filters we have in order to be aware of how we process information around us and finally understand why we act in a specific way. But where are they? Our beliefs/values come from our past experience (an old trade for example), education and mostly external environment, and “live” in our unconscious/subconscious mind. The way we believe in something is often not a conscious process but something built and reinforced automatically through our entire life.

Searching a contact between our conscious and unconscious/subconscious is definitely the key to succeed not only in trading, but I strongly believe in every aspect of our life.

If deep inside me I believe that losing is bad, failure is a negative thing, risk is dangerous, etc…my unconscious/subconscious mind automatically generates emotional responses to some events and in order to keep me far from dangerous things and “make me survive”, use automatic triggers to let me avoid repeating again through negative memories, bad emotions and sometimes physical pain.

Think again about your last stop. You just “lose” right? So, whatever some “guru” told you in your last seminar you attended or the last book you read, your unconscious/subconscious mind makes you feel bad. BECAUSE IT’S PROGRAMMED TO DO THAT!

Because it learned that losing is bad and if you keep on losing you are going to die! And your subconscious wants you to live, it makes you live every single day. So, it automatically generates negative emotions like fear and pain in order that you do not repeat. It wants to keep you in your comfort zone for survival.

But if you want to succeed you must go beyond your comfort zone, go beyond your “limits”, accept the risk, embrace uncertainty and probably experiment “losses”, “failures” and “negative responses” during this process.

Now it starts to make sense, right? So what can we do. Well, I can say for sure what I do, every single day!!!

Every morning I wake up two hours before the market opens: I do 30 minutes of Yoga Exercises and 30 minutes of Zen Meditation. Being in silence and watching the thoughts coming to my mind allows me to reach a sort of center state and clarify my purpose of trading for the long term goal.

During my trading I use a subliminal messages audio with alpha/theta waves in order to stimulate my unconscious/subconscious activity and reinforce positive feelings like self-esteem and self-confidence.

I always have a trading/emotions journal in front of me to write my feelings and create a database of my trades. It helps me to be aware of the mental processes inside me and recognize negative triggers asap.

I generally do not trade more than 3-4 hours, so in the afternoon generally I’m much more focused on working on myself through a self-enquiry process and Neuro Linguistic Programs.

I actively study NLP techniques in order to work on shifting beliefs, modeling process and much more. Applying NLP on myself is a MUST for me, much more important than trading itself in this phase of my journey toward success. Vince2

I’m also studying Photo Reading, an incredible technique to learn through your unconscious/subconscious at a faster pace than traditional methods.

As soon as you realize that the critical factor in trading is yourself, and start actively practicing meditation and practical psychology techniques, you will begin your journey toward success!

I’ll be happy to receive your thoughts and feedback on the above, including negative ones!

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