Morning thoughts (Trading in the Zone part 4)

I woke up a little early this morning and decided to consolidate and personalize my thought process for the day. Several of my attempts were just too complex and wordy, but after some effort I was able to streamline everything down to what I think are the essentials.

After thinking about the psychological component of the trading game, I am realizing that there are three major components: truly understanding what the 'market' is (information about what other traders are doing and completely neutral), the acknowledgment that I have no control over what other traders do (the market can do anything), and the idea that a trader has to take complete responsibility for everything that happens to himself/herself during the market, i.e. all the profits and losses, all the missed opportunities. The emotional upset/nightmare can only happen when one of these are missing.

If you find yourself emotionally/mentally upset, thinking that the market is out to get you - or - patting yourself on the back for all the money you are bringing in; stop and consider which component is missing from your belief system. Though it is a lot of work (and right now for me a constant and stubborn application and re-application), re-directing the 'energy' into the correct belief system really works - it remedies all of those problems.

Whether or not it will result in profits has yet to be proven for me personally, but if Scott and Mr. Douglas can be trusted (and I think they can), then the profitable trading will come as edges are refined and honed in.

Here is what I came up with (of course always subject to change as I work on applying it):

How to acknowledge that the market can do anything at any time and take responsibility for what I expose myself to:
1.    The market can do anything at any time, because each moment relies upon the decision of every trader currently participating in the market.
2.    I cannot predict the decisions of every trader participating in the market.
3.    I decide and am in complete control of how much money I give to the market and how much money I take from the market.
4.    I give the market no power to make me fear or regret. I control when I enter and when I exit.
     a.    If I feel fear or regret it is because I have ceded my responsibility to the market.
5.    Before I enter a position, I must take into full consideration the full risk of my decision:
     a.    Am I prepared to pay $xx to find out if this opportunity would work?
6.    Before I add to a position, I must take into full consideration the full risk of my decision:
     a.    Am I prepared to accept that the price may retrace after I add to my position, eating into my  profits?
     b.    Am I prepared to accept that the price may continue in the same direction after my decision not to add to my position, reducing my potential profit?
7.    Before I exit a position and take profits, I must take into full consideration the full risk of my decision:
     a.    Am I prepared to accept that my decision may be early and that I may be leaving money on the table?
     b.    Am I prepared to accept that my decision may be the best possible time to get out and that a later decision may mean less profit?