Today, I want to share with you my personal tilt shakedown checklist, a tool I use to keep my emotions and psychology in check while navigating the markets. As we all know, trading is a mental game, and understanding our triggers and tendencies is crucial for maintaining a disciplined and focused mindset. So, let's dive into the different elements of my tilt shakedown checklist and how it helps me stay on track.
First and foremost, I want to emphasize the importance of treating emotional triggers as valuable data to digest rather than reacting impulsively. By acknowledging our emotions and dissecting our psychology, we can rewire our brains to respond differently and move towards a more positive trading mindset. To support this process, I revisit the top half of my tilt shakedown checklist daily, ensuring that it is tailored to my own tendencies and behaviors.
The different faces of tilt can manifest in various ways, and it's essential to identify the ones that personally affect our performance. For me, some of the key tilt triggers I've identified are:
Life-related/induced tilt: Tilt can carry over from everyday life situations, such as arguments or disputes. Being aware of these external factors and their potential impact on our trading is crucial.
Mood/Attitude: Our demeanor and mindset play a significant role in our trading performance. We must be mindful of the attitude we bring to the charts and strive for a positive and focused state of mind.
Mental Capital/Trading Battery: Just like a phone battery, our mental capacity and cognitive abilities require regular recharging. Beware of mental drain and take necessary breaks to maintain optimal trading performance.
Emotional Strain: Our emotional well-being affects our decision-making and overall trading performance. Monitoring mood swings and ensuring emotional stability is essential for consistent results.
Physical Strength: Taking care of our physical health is crucial for maintaining peak performance. Proper sleep, exercise, and nutrition contribute to mental clarity and overall well-being.
Financial Status: Financial pressures can significantly impact our trading mindset. Assessing our financial situation and ensuring we have a comfortable risk tolerance is vital for trading with confidence.
Profit Induced: Surprisingly, significant financial windfalls can also lead to tilt. Managing the emotions associated with large payouts and avoiding complacency is essential for sustained success.
To further understand my thoughts, feelings, and actions, I observe and document them on a separate legal pad. This simple practice allows me to identify patterns, particularly the negative ones that tend to dominate our thoughts. By recognizing these patterns, I can intentionally move towards the opposite, fostering a more positive and constructive mindset. Rather than chasing perfection, I focus on continuous improvement, aiming to get just 1% better in some aspect of my trading game. Over time, these incremental gains add up, leading to enhanced trading performance.
We must remember that we create our own pain in trading. By practicing moderation and managing risk effectively, we can build confidence in our execution and eliminate fear of results. It's crucial not to chase the high water mark but instead release capital with joy, knowing that it will return multiplied in wonderful ways. Just like the market, our P&L will ebb and flow, so our primary focus should be on disciplined execution.
Continuing with the account protection rules and lockout strategies, it's important to have measures in place to safeguard against impulsive trading decisions during tilt. Here are some steps I follow:
Shutting Down Charts: When I recognize signs of tilt or emotional instability, my first step is to shut down the trading charts. Removing the visual stimuli helps break the cycle of impulsive trading and allows me to regain clarity and focus.
Closing Open Positions: I ensure there are no open positions on any of my trading accounts. Exiting existing trades helps eliminate the temptation to intervene or make impulsive decisions based on emotions.
Deleting Alerts: To prevent myself from being tempted to revisit the charts or engage in impulsive trading, I delete all alerts related to market movements or specific trade setups. This helps create a mental barrier and reduces the urge to act based on emotions.
Extreme Measures: While I haven't had to resort to extreme measures personally, I am aware that some traders take additional steps to prevent access to their trading platforms during tilt. This can include temporarily deleting the MetaTrader app or any other trading platform from their devices.
In the bottom half of my tilt shakedown checklist, I maintain a rule sheet/log. This section serves as a record of my trading offenses and describes the reasons behind my chosen actions and time periods. By analyzing past mistakes and understanding the triggers that led to tilt, I can identify patterns and make necessary adjustments to my trading approach.
Remember, tilt is a common challenge that traders face, and implementing these strategies can help mitigate its impact. It's crucial to continuously work on our mindset, emotional control, and risk management practices. By prioritizing self-awareness, discipline, and adherence to our trading plan, we can navigate the markets with greater confidence and consistency.
Stay tuned for my next blog post, where I will delve deeper into the offenses and lessons learned from my tilt shakedown checklist.
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