Good morning my friends! Love this quote:
"No profession requires more hard work, intelligence, patience and mental discipline than successful speculation." - Robert Rhea, Dow Theorist 1936
I pulled up a trading psychology blog I follow by Dr. Brett Steenbarger (who has a couple of of great trading psychology books I would highly recommend: The Daily Trading Coach
His most recent entry is about the importance of rest and renewal for traders. This is something I've had a difficult time getting used to: knowing when to take a break. I think it's part of the conditioning that happens to our brains during 13 years of school, college and then years of the employee work 9 to 5 mindset. Trading is a difficult and different ball of wax. Sometimes, NOT working is more efficient for your trading performance, NOT working may even be more beneficial for your equity curve.
An example. Several years ago, as some of you know, I made a nasty mistake taking away a stop from a gold trade that ended in a quick $25,000 loss. That happened the beginning of April in 2016. By July of 2016, my account balance was another 10k lower. During that span of 3 months, I felt strongly to take a small break from trading, even of just a couple of weeks. But, that strong feeling met a strong resistance in the form of my belief that "if I am not trading/working, then how can I possibly progress?" I have since learned multiple times that if I had taken a break from trading and given my mind and brain a rest, my account balance would not have suffered any more than it already had. Because I didn't take a break, it did suffer some more, and so did I. I should've taken a larger than normal break,especially after a larger than normal loss. And it's hard because you get to love the markets and trading....but you must rest!!
The same relates those of you who are just starting on your trading path. Rest and renewal is just as important when you're studying, practice trading and developing your own routine. Recognize that the trading profession is not like your boss or manager expecting a certain amount of hours and then you receive your paycheck, regardless of the quality of work you provide. Trading requires your best performance when it's time to perform, and if you don't find time to rest, relax, renew and reset your mindset, then your performance will suffer. Trust me, an hour of focused study/trading, is more beneficial than 8 hours of self-required obligatory forced effort. You may not see this clearly in the short term, but you most certainly will in the long-term.
Wherever you are on your path to becoming a trader, remember that rest and renewal must become an integral part of your routine and plan. This is becoming one of my favorite things about being a trader: when I've hit my profit target for the day, stop, rest and take a much deserved break, even if it's 9 o'clock in the morning. Who wouldn't love being done with their work day at 9 am every day, and able to spend the rest of the day with your family, or doing whatever you want? It's a hard thing to get used to if you've been an employee depending on a paycheck, but it's a good problem to have. ;)
Sunday is my favorite rest day for many reasons. I used to watch the futures markets open on Sunday afternoon and start trading if I saw something. But, I realized, not only is it the Sabbath and I can choose not to work on the Sabbath, but also, it's a day of rest for a reason. So, I even try to get out of any positions if I can help it on Friday, so I don't have to worry about any trades until Monday. My favorite resting activity was sitting in the front yard of a mountain cabin, listening to the wind blow against the many trees upon the mountain side.
So, take a break from the markets every once in a while, after a big loss, after a big winner, after an extended period of nothing. Give yourself the rest that matches what you put in through hard work, intelligence, patience and mental discipline unparalleled.
Have a great week!