As of 04/19/2024
Indus: 37,986 +211.02 +0.6%
Trans: 15,084 +136.79 +0.9%
Utils: 876 +15.31 +1.8%
Nasdaq: 15,282 -319.49 -2.0%
S&P 500: 4,967 -43.89 -0.9%
|
YTD
+0.8%
-5.1%
-0.7%
+1.8%
+4.1%
|
 39,800 or 37,150 by 05/01/202416,200 or 15,000 by 05/01/2024885 or 850 by 05/01/202416,700 or 15,800 by 05/01/20245,250 or 5,025 by 05/01/2024 |
As of 04/19/2024
Indus: 37,986 +211.02 +0.6%
Trans: 15,084 +136.79 +0.9%
Utils: 876 +15.31 +1.8%
Nasdaq: 15,282 -319.49 -2.0%
S&P 500: 4,967 -43.89 -0.9%
|
YTD
+0.8%
-5.1%
-0.7%
+1.8%
+4.1%
| |
|
39,800 or 37,150 by 05/01/202416,200 or 15,000 by 05/01/2024885 or 850 by 05/01/202416,700 or 15,800 by 05/01/20245,250 or 5,025 by 05/01/2024 | ||
In the early days of Basket Case Bob's life, he was a positive individual, with a smile on his face and love in his heart. Brought up in an optimistic family with money, he always had a sunny disposition, facing each day with renewed optimism, a happy-go-lucky guy.
In his adult years, he met Smooth Sally, and they got along famously. He had a son with her. Then one rainy afternoon, he asked his wife to go on an errand. During that errand, she got into a car accident which took both her life and that of their son. Since that time, he has been, well, a basket case.
He blamed himself, thinking that if he hadn't asked her to go on the errand, they would still be alive. Such negative thoughts affected not only his behavior, but his trading results, too.
Bob used to earn big bucks and was a skilled trader, but now he can't find a profitable trade. On one position, he cut his losses and sold. Three minutes later, the stock started the long uptrend that he had been waiting for all morning. Two losses later, he decided to hold on as a stock declined, believing that it was also going to turn up. The general market was moving higher, he reasoned, why not this stock? He held on longer than he should have and crashed along with the airline stock, selling near the low for the day.
Negative thinking is a bad habit, like picking your nose in public. If you practice negative thinking long enough, it becomes familiar, comfortable, and costly. You listen to an inner voice that warns, "you are going to lose money on this trade," and you do. Or "the stock is going to turn higher one of these years." It will, the day after you sell it.
One trader I know lost no more than $5,000 in a single trade during his life. Then he moved into the currencies markets and was doing well. That confidence along with increased leverage allowed him to place a $1.3 million bet on a currency play, one that went bad. He lost $31,000. The resulting depression caused by that losing trade lasted months, making life difficult for him and his family.
Unfortunately, his story is not unique. People think they can handle leverage and wipe themselves out in one trade. How many times have you heard that from traders? And no, I haven't wiped myself out, but I have been stung many times by dead cat bounces. The stock in which I made the most money (almost 5,000%), dead cat bounced no less than 18 times while I owned it, taking me down at least 15% each time. Fortunately, I don't use leverage.
What powers negative thinking? Basket Base Bob holds up four fingers and says, "There are three things...."
Trading can be the same way, like my friend that lost $31 grand. Traumatic losses in the past color your perception of the future.
Instead of exercising, do you form bad habits and don't exercise at all? How about meditation as a release for stress? Who wants to exercise and take care of themselves when they are depressed?
After losing his wife and son, Basket Case Bob sought out others that also experienced such loss. While sharing similar experiences might sound like a good idea, it was like being in the company of losers. No one was happy and they continued to be miserable, prolonging their suffering. Have you ever heard the phrase "misery loves company?"
New that we know what negative thinking is, let's discuss how to correct it.
Here are the steps to overcome negative thinking. I'm not trying to be negative, but you're not going to like some of these...
The fix is not complicated nor difficult. It just explores the nature of your fears, defines what is bothering you by confronting them (writing them down). Then it reshapes your thoughts by replacing fears with opportunity.
If a bad thought comes along, such as "I'm going to lose money on this trade," replace it with, "This trade is going to be the start of a series of winning trades." Begin to view fear not as a problem but as an opportunity. "I'll bet I can make this trade a winning one." "I am going to push past my fear of a loss and make a lot of money. It will take time but I will succeed."
What happened to Basket Case Bob? He followed the tips outlined in this article, but it was a difficult process until he met a girl. She helped him see how a positive attitude could build new opportunities for a future together. Recognizing that she was a key ingredient to his future success, he vowed to complete the steps necessary to change his negative thinking. His daily losses gave way to winning trades and his old confidence returned.
If Basket Case Bob can do it, then so can you. Think positively.
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Vacation: a 2-week binge of rest and relaxation so intense it takes another 50 weeks of work to recuperate.
on 