For Business

Trading Psychology

What Discipline in Trading Actually Means

Discipline in trading is doing what the plan says at the moments the feeling says otherwise, and it is a count of such moments rather than a mood or a strength. This paper shows you four moments in one afternoon, in example times, where the plan and the feeling disagreed; the idea as a metronome that keeps its beat whatever the player feels; the plan as a letter written in the morning and opened in the trade; what discipline is not, as bumpers on a bowling lane; and the saved template on your platform that carries the morning's lines onto every chart.

Difficulty
Intermediate
Reading time
5 min
Pages
8
Reviewed by
Saman Rahbar

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Four moments in one afternoon

Discipline is smaller and more exact than the word suggests. One trade, one afternoon, with these as example times. At 13:30 the trade is nine pips down and the feeling says move the stop away; the plan says leave it. At 16:00 it is fifteen pips up and the feeling says take the sixty; the plan says the target is fifty. At 17:00 the feeling says add a second trade; the plan says one a day. At 18:00 the feeling says watch; the plan says the alerts are set, close the screen. Discipline that day is four moments, and in each one the plan was done instead of the feeling. None of them felt good. That is what discipline is: a count, not a mood.

A metronome

Picture a metronome. Its beat is set before the piece begins, by moving the weight up or down the arm, and from then on it does not know how the player feels: it does not speed up for a passage that is going well or slow down for a hard one. Discipline is playing to the metronome. The beat is the plan, chosen when nobody was excited or frightened, and the weight is the plan's size and stop, which are what fix the beat. The player who plays to it is not stronger than the player who does not. They have simply agreed to be told the tempo by something that cannot feel.

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