It amazes me how much we can learn in a single day. We are bombarded with information, yet our brains can in an instant turn it into something we understand. A true trading super-computer at our disposal 24 hours a day, so why is trading so hard?
We use both sides of our brain, with each side taking on different roles depending on the stimuli. Yet when it comes to trading, we often run on only half capacity.
According to science, different sides of the brain deal with different aspects of life. When it comes to trading this applies also.
The left side is the analytical side. It’s structured, organized and processes logical problems.
The right side is spontaneous, acts on hunches, is visual and identifies patterns.
It is important to recognize which side of your brain dominates. If you find it hard to stick to a trading plan, place trades on a hunch and move your stops. Then chances are the right side of your brain dominates.
If you plan out every detail, worry over entering a trade on the exact pip, and set limit orders for exists. Then you are most likely left brain dominated.
Like muscles, the only way to gain all round strength is through exercise. There is no reason why the brain should be any different.
I am right brain dominated. It is a constant fight to maintain the discipline to trade. Yet some of my most profitable (I won’t say best) trades taken were on a hunch.
The right brain processed patterns that my left brain just didn’t know about. Almost always though my exits on these trades were diabolical. Right brain got me in, but had no idea how to get me out.
It is clear my left brain needs a good daily workout to compliment those forward thinking left brain trades. Something that requires discipline, forward and methodical thinking.
My solution before starting trading every morning? The only thing that can mirror the frustrating logical thinking needed for trading.
The game drives me nuts, but it needs a bunch of patience and logical thinking and so serve as the perfect warm up for a trading day.
A great trader is someone who can trade what they see and feel while maintaining the discipline to stick to a trading plan to let you cash in.
So what are you doing to exercise the most important tool in your trading arsenal? Are you left or right brain dominated?