If your answer includes the words “about” or “roughly” you’re wrong. You should have exact figures. WHY? Because having those figures gives your mind something to anchor to when the going gets tough. It provides a foundation for you to build your trading house on.

If you know, for example, that your system produces 4 losing trades in a row on average and that you had a maximum of 7 losing trades in a row over the sample testing period, you have a base line. When that 3rd, 4th and 5th losing trade come you can have confidence that if you are disciplined, the losses will soon end. Not only were you prepared for this drawdown, you were expecting it. You knew it would come. And now that it has, you are prepared for it mentally.

When this happens your reality literally shifts. You can now change what kind of effect your decisions have on you emotionally based on how you now view your trading. Instead of “winning brings me pleasure and losing brings me pain,” you now have a new reality: “Following my rules brings me pleasure; not following my rules brings me pain.” This is much the same way someone who used to overeat due to a love of food now eats healthy because of a love for their health. They have shifted what brings them pain and pleasure based on how they view the world.

Imagine how different your results would have been over the past several months if you had simply applied some if this knowledge. But alas, you’re trading journey has gone largely the way of the 90%. See if this sounds familiar. (Not unlike the dieter.)

1. Get interested in FOREX and find a chat room where you tell others of your interest.

2. Listen to those people give you advice about how best to trade FOREX. (Most are losing money hand over fist.)

3. Buy several new books by current authors covering the latest strategies for achieving your goal.

4. Do OK in a demo account, decide to go live.

5. Blow your account out in a month.

6. Attend a seminar, buy a $97 EA that promises you millions while you sleep, join a signal service or a live trading room.

7. Decide to get serious and create a plan to follow.

8. Religiously follow your trading plan.

9. Start to see some results.

10. Get cocky.

11. Slip back into your old habits.

12. Blow your account out again.

The secret to gaining discipline in your trading is having confidence in what you’re doing. That comes from KNOWING. Not hoping or believing but KNOWING that if you follow you rules with consistency and discipline that you will achieve consistent results.

Now if you don’t have a winning system or any idea how to test the one you have, then we have more to discuss. But that will have to wait for another article. Until then I wish you every success in trading and in life. Good Luck and Good Trading,

Jason Stapleton
professional trader
co-founder of TradeEmpowered.com