Prospect Theory Complete Evasion! ~ The Essentials of Mental Management ~ [Trade Battle Weekly Report Week 4: Dentist Trader Nobushi vs Calligraphy Trader Tomoaki Kuramoto's Trade Battle]
Well, the trading battle has reached its climax.
For a moment, overwhelmed by the pressure of
trading battle, I lost myself
and my trading style and account balance were about to collapse, but
I have regained my own trading style now.
Rather than beforetrading has become more refined!
I have also reconfirmed the effectiveness of my own method☆
Like after rain, the ground is harder. Haha
Additionally, I have established a new entry method as well (｀・ω・´)
It was quite tough in various ways, but
as a trader, I have grown tremendously (｀・ω・´)
And
the outcome of the trading battle
is now irrelevant to me either way. Haha
When I try to win, I end up losing
due to the prospect theory,
more than winning or losing,
what matters is carrying out the trades I should do!
But I already knew this from the start (;^_^A
I think I wrote about it in the first blog about the trading battle.
Even though I understand it in my head,
when the situation actually occurs, I don’t understand (;´・ω・)
Reason and emotion are separated.
Neuroscience also says so.
It seems impossible to control emotions with reason.
For example
when you are shaking with tremendous anger
you cannot smile broadly,
and more, you don’t know what you might do because of that anger.
If you cannot control emotions with reason,
if you become emotional, what can you do?
That’s the question, but
the important thing is
to wait for the emotional wave to subside.
First, when you become emotional
analyze and become aware of what kind of emotion you are in.
Is it anger, sadness, or frustration,
or are you feeling happy and buoyant?
If it’s the former, you tend to trade recklessly trying to recover
If it’s the latter, you tend to make sloppy trades and mistakes.
Once you know which emotion is dominating you,
then the next step is to
wait for that emotion to diminish.
If the emotional wave subsides,
you will be able to control it with reason!
Just like charts,
emotions have wave properties.
In other words, there are big waves and small waves.
So
when a big wave comes,
you should wait for it to become a small wave.
When it becomes a small wave,
you can look back at your original trading rules
and return to the trades you should be making originally.
However,
the problem here is
when your brain is completely ruled by emotion,
you don’t even know which emotion is controlling you right now.
Rather,
you don’t even realize that you are emotional (;^_^A
This is very troublesome!
Perhaps this is why people say it’s impossible to control emotions with reason.
So what should we do?
In order not to become emotional,
you should arrange your environment!
For example
Trade with surplus funds that can tolerate losing.Lower your lot size to a level you can tolerate even if you cut losses.If your account balance ever drops to zero, have another source of income to recover.Avoid doing battles like a trading battle. Haha
And most importantly...
Get enough sleep!!!
Lack of sleep
reduces brain performance and dulls thinking.
It becomes harder to think theoretically,
you make calculation mistakes,
and you make more minor mistakes that you wouldn’t normally make.
In addition,
a sleep-deprived brain tends to become emotional.
I think everyone has experienced it,
when you are sleep-deprived, you get annoyed at trivial things, right?
When you watch a small drama and cry easily, you are probably sleep-deprived, aren’t you?
Remembering well, every person has surely had this experience at some point in life.
If you can’t recall,
when you feel irritated or sad in the future,
check whether you are sleep-deprived.
You’ll probably realize it suddenly.
By the way, similarly
when you think you are worthless
or think you cannot do it
it’s often because you are sleep-deprived.
So when you lose confidence, sleep well!
As a side note, similarly
sleep deprivation makes you crave food.
As noted, you can’t think theoretically,
and since sleep deprivation increases stress hormones in the blood,
to ease those stress hormones,
humans instinctively want to consume sugar and fat.
So if you want to lose weight, sleep well!
This digression aside,
sleep deprivation is extremely important (｀・ω・´)
In summary
・Trade with surplus funds. ・Lower lot size to appropriate levels. ・Secure another source of income besides trading. ・Get plenty of sleep.
This is crucial for mental management!
To reiterate,
this is not mental control but
mental management!
Control of emotions
is not the goal; rather
management
If you were to describe it,
it might help to think of the emotions inside you as a baby.
When a baby is crying,
You change its diaper, give it milk, and provide the comfort of having a mother nearby
by arranging the environment for it.
That said,
I’ve never raised a child, so I’m not sure if that’s correct (;^_^A
With that long preface,
now I will report this week’s trading results. Haha
First, a discussion of the entry points
February 19, New Zealand dollar
On the 15-minute chart, I confirmed the line break and trend reversal pattern.
I entered on the one-minute entry signal after the line had clearly broken.
Since the signal also rang on the 5-minute chart,
it would have been fine to enter after confirming the first line break on the 5-minute chart!
Next.
February 20, USD/CHF.
This is a very clean flag break pattern☆
For the flag pattern, please view the free report titled "Jinmei-Style First-Class Chart Pattern Collection."
https://www.gogojungle.co.jp/tools/indicators/15043
In the February 20 Leap Trade FX video, this pattern is explained in more detail and concretely!
And then February 20, EUR/USD.
HT Auto Channel rebound followed by a 1-minute scalping setup superbly worked☆
To be precise,
I stretched the profit, so it wasn’t scalping exactly, but
the entry timing was scalping-like♪
If you really want to scalp, just take profit smoothly right after the signal rises♪
On the 5-minute chart, it looks like a typical range.
On the 30-minute chart, you can see it’s supported by the 60-period EMA and rebounding, so on the higher timeframe it’s a trend-following move.
Next.
February 21, EUR/USD
This is again HT Auto Channel rebound followed by a 1-minute scalping signal.
Right after a lower wick, the one-minute chart shows the next pullback high is also broken, forming a clear 1-minute trend-reversal pattern♪
The lower wick and break of the pullback high are classic trend-reversal patterns, so the subsequent rise is strong☆
On the 5-minute chart you can see it was supported by two horizontal lines!
On the 15-minute chart you can see it touched and rebounded from the ochre HT Auto Channel!
Next.
February 21, 16:00 AUD/USD.
Next.
February 22, New Zealand dollar.
On the 5-minute chart, you can see it breaking the pullback high line before a large bearish candle,
and this pattern matched the scenario I explained during the Leap Trade FX distribution,
On the 1-hour chart, despite breaking a large range, it surged as if nothing happened.
This is a big deceptive pattern, so it’s a setup that tends to go higher.
I think next week will also be a rising market,
in my view.
So I traded in many different ways, but
this week’s results are
Number of trades: too many to count (;´・ω・) Pips earned: too many to count (;´・ω・) Net profit: 45737 yen
The total profit since the start of the trading battle is here
This month is February,
the shortest month of the year,
so there are only four more trading days available.
How many entry opportunities can come in four days?
That’s about it.
If there aren’t any chances,
no entries, and if you lose in the trading battle with no entries, that’s fine!
It’s a hundred times better than forcing entries out of greed!
By the way, isn’t it impossible to make up for it from here? Haha
From the start, I thought Nobushi-sensei was capable,
so this is as expected for me♪
After the trading battle ends, I’d like to learn trading from Nobushi-sensei. Haha
※ Sale ends at the end of February!
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