Traders, your commitment to follow your trading plan and stay disciplined is just like a commitment to cut out sugar. The problem is…  The FOREX market is your bakery.

Each and every day you sit down to trade your commitment to follow your trading plan will be tested. You’re on a diet in a pastry shop. The market will seek at every turn to challenge your resolve and attempt to push you out of your comfort zone causing you to make impulsive emotional decisions rather than disciplined, planed ones.

Many people will tell you it is wrong to look at the market as a living breathing entity, “The market is not out to get you.” the saying goes. But I find in this case that it serves the analogy well. The “market” is the representation of every trader’s decision at a specific point in time. That’s all. But the market rewards risk and punishes those that follow the path of least resistance. This must be the case in order for markets to function.  Because of this simple truth we can deduce that in order to succeed, we must have the strength of our convictions since they will no doubt run contrary to many in the market.

Remember 90% of traders lose money. If you want to be part of the 10%, look at what the 90% do, then do the opposite.

If you’re still reading I’ve kept you in suspense long enough. So how do you stay disciplined given the overwhelming temptation to do otherwise?

Discipline is an emotional quality. To have discipline means you have fixed yourself in a course of action and are unwilling to deviate from it. Having discipline starts with commitment. Even this first step causes people some problems. A lot of people think they are committed but most are not.

“There’s a difference between interest and commitment. When you’re interested in doing something, you do it only when circumstances permit. When you’re committed to something, you accept no excuses, only results.” -Art Turock-

Step one to staying disciplined: Are you truly committed? If not, you must make that commitment if you ever expect to succeed. This first step, while simple, acts as an anchor to your trading. The commitment to succeed is what allows your mind to focus on a goal. This is a moving target. As one goal is achieved, a new commitment to a new goal must be set, allowing you to continue your journey.

In NLP and NAC (psychological processes) we actually call this an “anchor”. You must literally change your perception of reality before you will truly create lasting change. Again, using the weight loss analogy, people who ultimately achieve lasting results have shifted their reality. Often this comes from a doctor visit when they are told they have diabetes. For some it comes after a heart attack, or after a child expresses concern for their wellbeing. Whatever the catalyst, something changes in the individual at a fundamental level that literally alters their perception of the world. Their new reality causes them to view their decisions differently and shifts their focus of what’s important.

But if blowing up account after account doesn’t do the trick, how do we create this anchor? I find that a lack of trader discipline is the result of 2 specific things.

1. A Lack of direction

You simply don’t know what you’re doing. This sounds a little harsh but the cold hard truth is most traders simply don’t have the education, understanding and experience to have confidence in what they are doing. If you’re struggling with discipline right now I would venture to say you really question if there’s something you’re missing. Some piece of the puzzle you don’t yet have.

2. Lack of/Unprofitable Trading System

This one gets misunderstood. I don’t mean to suggest most traders don’t have a winning system. What I am saying is that most traders don’t KNOW if their system is a winner or loser.

They have never done any of the hard work necessary to test and verify the system they are trading. I would venture to guess that most of you reading this article have not tested the system you are currently trying to follow for any length of time. For those of you who think you have, let me ask you a couple of questions:

Over the past 300 Trades,

•What is the expectancy of your system?

•What is the average DD given your money management strategy?

•What is the maximum DD?

•What is the average number of losing trades?

•What is the maximum number of losing trades in a row?

•What is the average Risk/Reward Profile?

•Given your money management system, what was the ROI over the past 300 trades after accounting for slippage and commissions?

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