End of the Week review and Education, using high probability opportunities for this week in Forex, Indices & Commodities.
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This quiet week is a great opportunity to go over an important part to your mental edge in trading.
You may not even have realised that you need this. But my gosh you do. Especially if you haven’t seen this issue in yourself already!
No, I’m not talking about sitting in meditation (although that definitely helps if you don’t already do it), but sitting with something else…
Before we being the lesson for the week, let’s update what’s happened this week:
- EUR/USD – no setup given, no trade
- CAD/JPY – no setup given, no trade
- EUR/JPY – no setup given, no trade
- EUR/CAD – no setup given, no trade
- WTI Crude Oil – no setup given, no trade
- AUD/NZD – almost a setup given, but didn’t meet criteria, so no trade
- Gold – no setup given, no trade
So then, no trades taken this week. If you’re surprised by this, ask yourself if you’ve been unprepared this week. Because we’ve prepared in advance for a slow week and month.
Look closely as you rewind the week. Non of our criteria/parameters were met. It looked close on AUD/NZD, but we never completed the final criteria.
What Hinders Your Focus
Let’s define it first. Here’s the Cambridge dictionary:
As you can see, it’s about what you give your attention to. And you cannot give your attention to multiple things at once, otherwise your attention becomes split.
If you’re not focused in your trading on a regular basis, chances are you’re looking at too many charts. And not only that, but doing so in a short period of time. You might have 10 charts you want to monitor, which is fine – in the space of a week. But if you’re looking at those 10 in the space of 10mins, your focus is destroyed.
The solution seems simple then: remove the number of charts you look at. Yes, and also…
Create a Mental Margin for Yourself
So you know about Margin in your trading account; the one the broker gives you and says you must maintain when you’re trading. It’s like a cushion or buffer of space that you need to keep free, for risk control. Go beyond it and you have a Margin Call and your account is gone.
But have you ever thought about Margin in your own mind?
In the same way as your account, you must keep a margin in your mind. Extra room, extra space.
If you fill up your mind with many charts at the same time, you’re not leaving it any extra room to operate peacefully. Think about it, you’re seeing so many more candles, there’s so much more noise in your head, and neither any focus or peace. You’re just in a rollercoaster, stressing and overloading your brain.
It’s like the straw that breaks the camel’s back. It will only take a bit more strain and your brain will go into a meltdown.
Don’t use your brain to 100% capacity, trying to absorb all the news, analysis, tons of indicators and what they’re saying.
This is not a strategy edge: this is a mental edge. And that’s way more important for you to succeed!!
How To Create the Mental Space to Focus
- Cut down the number of charts you monitor.
I typically look at about 7, but even that’s too much. The reason I can manage it is because it’s on a higher timeframe, so things happen slowly. There’s no rush.
If you keep flicking between different markets, cut it down to 2 or 3 of your favourites
- Always leave ‘extra room’ in your mind. That means, monitor how much capacity of yourself you’re using up. If you find yourself worn out mentally, ask yourself what you can cut down. What are the most important elements? How can you simplify your process even more?
See that you operate at about 75% capacity. You will be fresh and last longer in this game.
- Only pick the best market/chart to enter on the day – with high probability. Don’t try to grab everything at once. Don’t split your attention. Stay focused on the one.
The one who chases two rabbits, catches none.Confucius
Written by: Dima Mihailovich, Technical Analyst for Forex Prop News
Contact and follow Dima on Twitter: @dimafpn
Image by PatrizioYoga, on Pixabay.
(Please note: All comments made in this video and article are not trading or investment advice and are for education purposes only. You are responsible for your own decisions and the risk that goes with it.)