Did you know that you don’t have to be mentally ill to have different personalities reside in your body? Actually, it is quite normal to have various “parts” that emerge at different times depending on what is going on at the moment. If fact, these parts speak different languages (as in negative thoughts vs. positive thoughts) and see different things as well; which is why you may have wondered how you made that bonehead trade after seeing the chart’s reality in the wake of a loss. This kind of personal and emotional volatility can play havoc on your trading account. Similar to the market, personal volatility as you trade is a reflection of the emerging emotions of the masses as they trade furiously, impulsively, and at times capriciously.

The market is continually sending messages; messages about volume, momentum, and volatility. But, those messages are best captured by first attending to your own volatility so that you can see the charts as they are. In fact, every blemish, character flaw and weakness that you have is in that reflection, because you “express yourself” while in the markets. The successful trader can “feel the markets” through insight and intuition that has been developed through countless hours of observing market charts; but she does not get lost in those feelings. The successful trader has an intimate understanding about the importance of emotional intelligence, i.e., managing emotional volatility through protocols, routines and habits. They focus on doing the “right” things habitually (following trading plans, rules, money management and position sizing) as if their life depended upon it…and their trading life does depend upon it. In this way they set themselves up to get the right results habitually. They know that consistent successful execution is intimately related to mastering the right things. This represents the development of a “positive trading trance.”

The “positive trading trance” (supporting your ability to focus with a laser precision) becomes a Zen of trading by losing the ego attachment and using mind management tools that engage the subconscious to work for them rather than against them. This is accomplished by redefining your relationship to the trade. As in a business transaction with another human being, the objective is to be in the flow; that is, a detached interaction where (even when a profit is involved) you are not attempting to aggressively bleed the situation dry but come away having done well.

To be and stay in the flow of the “positive trading trance” you must be fully conscious and “watch” what you are doing. You want to activate the “internal observer” and this is accomplished by relaxing at every opportunity and creating the habit of “being fully present, in the moment; and in the Now of the trade.” In this way you can access and activate internal resources that can shift you from a state of fear, frustration, irritation, and stressful tension to a state of relaxation, mental clarity, and self-confidence with focused intention on doing the “right” thing in the trade. There are many internal resources that you have, a lot of which, you may not even be aware. But, it is very difficult to be available to accessing and activating internal resources without activating the internal observer.

Activating the internal observer can be accomplished by doing the following:

Change physiology

• Change your physiology, stand if sitting or sit if standing
• Straighten your body
• Take a good stretch
• Take a few deep breaths, in this way you are oxygenating the blood in your brain and muscles, which in turn helps you to relax. By breathing deeply you slow things down and initiate a “Relaxation Response.”