I work with more and more traders on creating their own “upward spiral” – a process unique to the trader they can use to continuously improve.
It’s modeled after the system I created for myself years ago at a low point in my trading career.
I realized I didn’t need another idea for a strategy, I needed a process that, if I followed it, would make trading profits inevitable.
As I spoke to a trader recently about his process, it dawned on me that there was a critical piece of the puzzle that he was missing.
He had traded with a lot of emotions and wanted to get more systematic in his trading.
He started keeping a journal which is the foundation of any successful trader.
He had a coherent strategy and was executing it.
He started seeing definite improvement.
So far so good.
But I realized though that he could be so much better if he added just one important step to his process.
It’s something that has been second nature for me – something that I internalized so long ago that it seems obvious to me.
But he was completely missing it.
What is it?
A feedback loop for finding trades that you didn’t take, but you should have.
Simply journaling all the trades you DO take won’t give you any information on the trades you DON’T take.
Without a process for identifying the trades you didn’t take, you’re only seeing a small part of what you have to see to get better.
Once you work this step into your routine, light bulbs will start going off in your head.
“Wait – how did I miss THAT profitable trade?”
That feeling can be frustrating at first, but when you start doing this regularly it becomes motivating.
It’s exactly the kind of motivation that will eventually yield profitable trades.
