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Psychology Flashcards

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1
Q

True or False: I do not have what it takes to succeed in life

A

False: I am made in the image of God, I am capable of learning and applying anything necessary to find success in any field.

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2
Q

I am a consistent winner because (1-4)

A
  1. I objectively IDENTIFY edges
  2. I PREDEFINE THE RISK of every trade
  3. I fully ACCEPT THE RISK or I am willing to let go of the trade
  4. I act on my edges, I EXECUTE without reservation or hesitation
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3
Q

I am a consistent winner because (5-7)

A
  1. I pay myself as the market makes money available to me
  2. I continuously monitor my susceptibility for making errors
  3. I understand the absolute necessity of these principles of consistent success and, therefore, I never violate them
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4
Q

Deadly Sin #1

A

Trading my thoughts instead of my proven system

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5
Q

My A+ game is defined as these 5 things:

A
  1. Process oriented
  2. not caring about profit or loss.
  3. Dismissing thoughts of worry as catastrophizing.
  4. Easy to admit being wrong upon presented evidence beyond a reasonable doubt.
  5. Feeling the sting of a loss or a cluster of losses, but able to easily walk away.
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6
Q

When money is on the line you will be battling :

A

Hope, greed, fear and pain

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7
Q

Become attached to these 3 things:

A
  1. Execution
  2. Skill
  3. Improvement
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8
Q

Become detached from:

A
  1. Results
  2. Profit/Loss
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9
Q

Three Demons in real life that show up in trading are:

A
  1. Illusion of control
  2. Hatred of mistakes
  3. Hatred of losing
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10
Q

To avoid loss aversion we must look at each trade as:

A

Part of a cluster, meaning each individual trade does not mean much.

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11
Q

Avoid falling into a directional bias. The market is the ______, not your _____. Allow it to paint a clear _______!

A

Artist, brain, picture!

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12
Q

When taking a beautiful setup in line with currency strength and market trend we can expect:

A

Something to happen! It could be a win, or could be a loss but the expectation should be the same as placing money in a slot machine!

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13
Q

The best practice for managing P&L should be to view in terms of:

A

Risk units! This places an extra barrier between emotions and attachment to money

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14
Q

True or False: A great doctor is always thinking of how much money he is making when performing surgery on a patient.

A

FALSE

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15
Q

The most probable setups occur in line with the _____

A

TREND

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16
Q

Missed Opportunity: “I know I can’t catch every single trade, however, the bigger mistake would be to…”

A

Force a bad entry and violate my system rules, then feel even worse for gambling regardless of the trade winning or losing

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17
Q

EOD checklist

A
  1. Did I follow my money management & position sizing
  2. Did I execute my methodology properly? Entry when signal presented itself and exit according to plan?
  3. Has my emotional state and mindset been properly dialed? Am I watching the market and hoping or focused on execution and managing a business?
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18
Q

Greed causes us to take? Because?

A

Excessive risk; because we have an unrealistic expectation for a trade

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19
Q

Hope causes us to? Because?

A
  1. Not place or move a stop loss
  2. Take excessive losses;

We have the idea that at some point the market will fulfill our expectations

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20
Q

Fear causes us to? Because?

A
  1. Take small profits, take big losses from fear of being wrong
  2. Jump into bad trades for fear of missing out
  3. Violate system rules because fear generates irrational impulsive thinking
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21
Q

Pain and psychological damage cause us to? Because?

A
  1. Violate of system rules.
  2. Blow accounts

There is nothing worse than laying in bed at night knowing you violated your system and blew your opportunity as a professional

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22
Q

10 Demons to watch out for

A
  1. Exiting too soon
  2. Exiting too late
  3. Entering too late
  4. Entering too early
  5. Taking trades not in playbook
  6. Incorrect stop placement
  7. Taking wrong size of trade
  8. Averaging down in losing trades
  9. Moving stop loss in a live trade
  10. Trying to make up for mistakes an violations after an initial error
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23
Q

SMART goals stand for:

A

Specific
Measurable
Attainable
Relevant
Timely

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24
Q

P.R.E.P

A
  1. Planning & preparing: review screenshots of playbook setups and review trading plan
  2. Rehearsal: go back and review plays in mind and on charts
  3. Eventuality: prepare for all case scenarios(additional entries, SL, loss of power, etc)
  4. Positive state: needed to achieve prior to trading session (what have you been doing well this week, what things have you executed properly, what’s been going well in life)
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25
Q

7 Secrets of high performance traders:

A
  1. They are NORMAL, just like you and me
  2. Figured and EDGE THAT WORKS in the markets
  3. They TAKE RESPONSIBILITY for all trades, good and bad
  4. They have a GAME PLAN
  5. They have a VISION of where they want to be
  6. They WORK extremely hard
  7. They DONT QUIT
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26
Q

Trading is a ______ game, so we must:

A

Losing

Get great at taking small losses

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27
Q

As soon as you feel emotions creep into the picture you’ve already gone from the ______ to the ______!

A

Hunter, hunted

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28
Q

10 tips for trading success:

A
  1. Know your edge
  2. Work hard
  3. It’s all about flawless execution
  4. Balance. Keep trading in perspective to other commitments
  5. Don’t waste time looking for the holy grail
  6. Don’t buy the hype of fake gurus, do the work put in the effort
  7. Be quick to adjust, don’t be stuck in your bias/position
  8. Do the things that matter; money management, methodology, and mindset
  9. Nothing in life is free and nothing happens overnight. You need to be willing to put in the time and disciplined effort with deliberate intention.
  10. Take responsibility! Don’t make excuses for anything. Good bad, right or wrong
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29
Q

The brain will often see loss as:

A
  1. Missed opportunities
  2. Defeat
  3. Hopelessness
  4. Fatality
30
Q

After a loss, the brain will attempt to trigger which 3 LFEs? (low frequency emotions)

A
  1. Frustration
  2. Disappointment
  3. Self-doubt
31
Q

Just because your at the screen does not mean you have to:

A

Take a trade!

WAIT for the BTS.

Taking random trades doesn’t mean you’re gonna get paid.

32
Q

Trading is a _________. You need to manage the ____, execute the ____, and accept ________.

A

Business!
Risk
Plan
Expenses/Outcome

33
Q

In reality, the bulk of trading success comes from:

A
  1. Risk management
  2. Identifying asymmetrical risk to reward opportunities
34
Q

____ Management > _______ & _____.Every single time!

A

Risk, entries, exits

35
Q

3 Ways to create good trading habits:

A
  1. Accountability system for yourself
  2. Journal the quality of your prep
  3. Accountability self/outside
36
Q

Good trading is not about being _____. If you want to be successful, you need to think of the ____ ___, and ignore the _______ of ___________ ______!

A

Right, long term, outcome, individual trades.

37
Q

What separates professional traders from amateurs?

A

The ability to take losses well

38
Q

Amateurs come to the market with 3 things:

A
  1. Unpreparedness
  2. Unrealistic expectations
  3. Emotional disorientation
39
Q

The professional trading “process” is made up of these three elements:

A
  1. Money management
  2. Methodology
  3. Mindset
40
Q

True or false: I’ll succeed if I work hard”

A

False

41
Q

True or false: All I need is to be disciplined”

A

False: you need a legitimate repeatable edge

42
Q

True or false: “Emotion is a traders worst enemy” for 2 Reasons:

A

False; you shouldn’t have any emotional baring on how you managing your trading system

Because you’ve LET GO OF the OUTCOME of that trade

because your focus is to MANAGE RISK and not to get fooled by randomness

43
Q

Your __________ and __________ is the only thing you have control over in the markets!

A

Preparation and Execution

44
Q

Four Pillars for Successful Trading (P.A.D.R)

A
  1. Preparation aligned with you personal goals, temperament and your system
  2. Attitude: patience, discipline, objectivity and realistic expectations
  3. Discrimination: narrow down methodology based on pair an time of day
  4. Risk management: take losses quickly and often, stay in the game!
45
Q

Every trade is the same regardless of what you ________ it to be, so you need to always factor in your risk management rules.

A

Perceive

46
Q

4 feelings of Overconfidence:

A
  1. Elation
  2. Excitement
  3. Invincible
  4. Super smart
47
Q

The 5 most dangerous words in trading and investing:

A

“THIS TIME, WILL BE DIFFERENT.”

48
Q

What are the 2 most important skills required for profitable Trading?

A
  1. Managing capital
  2. Managing psychological capital
49
Q

You can’t become a 7 figure trader if you don’t learn to…

A
  • Cut your losses
  • walk away for the day
50
Q

What do you need to stop doing?

A
  • Taking way too many losses in one session
  • Thinking about taking early profits if a playbook setup calls for 4R
  • Entering early/late
51
Q

What do I need to improve on?

A
  • stamina: through physical activity
  • mental peace, balance, clarity: meditating & reading
  • time management: organized disciplined schedule for sleep, exercise, mental health, growth and learning
52
Q

6 things that I need to do better?

A
  1. focusing on execution and process based thinking
  2. accepting all possible outcomes and uncertainty
  3. accepting RISK per trade and respecting daily loss limits
  4. accuracy of entries. Patience!
  5. practice, practice, practice (replay mode)
  6. review film (study last weeks setups)
53
Q

5 Second Pause: Step 1

A
  1. Feel the surge: sense the rush of emotions getting riled up (trade slipping thru your fingers, market not going your way, stop loss soon to be triggered)
54
Q

5 Second Pause: Step 2

A
  1. Hit pause: literally give yourself 5 seconds. It’s the blink of an eye but it’s also enough to break the emotional loop!
55
Q

5 Second Pause: Step 3

A
  1. Breathe: take a deep breath in and let it out slowly.

Those few seconds of deep breathing can work wonders to calm your racing heart and clear your mind

56
Q

5 Second Pause: Step 4

A
  1. Question yourself: While you’re doing the breathing thing, throw yourself a question: “Is this decision based on strategy or emotion?”

You’d be surprised how often emotions try to pose as strategies or rational thinking.

57
Q

5 Second Pause: Step 5

A
  1. Proceed with Purpose: Now that you’ve disrupted the emotional autopilot, make your move with intention.
58
Q

The 5 Second Pause
is not…
it is…
when…

A

A magic spell to zap away emotions.

A practice that you can whip out

Those emotions start doing the Macarena on your decision-making process.

59
Q

The 5 Second Pause is essentially your…

A

ticket to more rational, less roller-coaster-y trading.

60
Q

Strategy must be 5 things:

A
  • simple
  • consistent
  • proficient
  • duplicatable
  • scalable
61
Q

Mastery is made up of these 6 elements:

A
  • daily routine
  • consistency in the daily process
  • performance driven metrics
  • balanced mindset
  • congruent with personal risk appetite
  • patience to wait for the desired setups and adequate sample size of trades
62
Q

FOMO is a..

A
  • psychological perception that causes trading mistakes
63
Q

It’s a daily battle to not engage in..

A

impulsive, irrational, emotional behavior

64
Q

What is the hardest thing for a trader to do?

A

Get off the screen!

65
Q

My goal each day is to not be:

A

Stupid: enough to break my rules, add to a loser, take impulsive trades, trade outside the plan

Lazy: in not preparing, marking levels, following the process, looking for the best setup, sticking to simple high probability setups, doing workouts, reviews of playbook setups, not doing affirmations, getting off screen when shift is done

Arrogant: enough to believe I can trade whenever I want thru overconfidence an be humbled by the market, not using proper risk management, not taking profits, delusion an elation after a big win

66
Q

The four $$$$ of Trading

A

$etups!

$ management!!

$elf Management!

$tupid Trading Behaviors!!!

67
Q

10 STBs (Stupid Trading Behaviors) are:

A
  1. Lots of screen time
  2. Going into tilt
  3. Random trades
  4. Overtrading
  5. Over leveraging
  6. Emotional trading
  7. Not having Daily routines
  8. No process based mindset
  9. No Proper funding
  10. Thinking that working harder and longer will make you better. You need to have edge and know when to apply it
68
Q

Disciplined trader has/does these 10 qualities:

A
  1. Trading plan/setups
  2. Executes setup entries
  3. Manages risk on every trade
  4. Takes profits consistently
  5. Has trade management rules
  6. Reviews trading performance
  7. Is emotionally orientated at the screen
  8. Routine and process
  9. Plans their trades and trades their plan
  10. Consistently GROWS their trading business
69
Q

Un-disciplined Trader does/has these 10 qualities:

A
  1. Trades what they think
  2. Takes random trades
  3. Varies leverage per trade
  4. Holds on to losers/cuts winners
  5. Wings it on trades as they go
  6. Has no review process
  7. Gets emotional, takes revenge/anger trades
  8. No routine, no process
  9. Doesn’t plan, just trades
  10. Consistently BLOWS their account
70
Q

If your overtrading your
1.
2.
3.

A
  1. Not following your plan
  2. Not trading playbook setups
  3. Encouraging bad habits, even if you win your rewarding bad behavior
71
Q

Make money on..

A

The days that it’s EASY to make money!

Psychology Of Trading (5 decks)

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