Quote from JackDaniel:
Grob,
This is alot of fun reading and trying to learn you're concepts. They seem sound to me so far. Thanks for sharing.
Here's a quote from something you said Wednesday....
"Because I keep my NLP pictures really clean, I do it like breathing."
What are NLP pictures?
Also, you mentioned something about colors changing on the TWS display and this was important. While watching the bid and ask depth today on the TWS, the colors were changing from red to green quite a bit. I'm not getting what you meant with the color changes in addition to the smaller price etc.
Thanks,
jd
NLP is Neurolinguistic Programing. It refers to the pictures you have that make up your belief sytem. Usually people test things against their beliefs. Because they do, when they are trading they need to have a good set of beliefs.
Once you test, you decide. You usually turn your decision into actions.
What most people test against their beliefs is the result of their analysis of data they gathered.
This string of events, taken all together, is "execution".
Any imperfections anywhere along the way are going to have consequences.
so learning to trade either gives you an excellent string of gathering data, doing analysis, comparing your analysis against your bliefs, and taking action to get the job done.
The major imperfections you see posted for each of these fours steps are:
1. People act on signals and do not gather complete data. If you look at set ups for edge traders, you often see they do not represent a complete set of data. The consequence of omissions is best represented by win loss ratios.
2. Often analysis is done in a context of split second timing. analysis is a lawyerly like thing. All the possibilites are known by precedent. You need all the stuff from 1. to plug in to complete theanalysis. Most traders wing it so they have faulty analysis. You need to design an approach that has a go/nogo set of criteria to run through to get the result. A dichotomous key is the best. you just threadyour way to the answer by passing the branch points as Y's in the path.
3. Beliefs are what you bring the step 2 too for a fitting. here the screw up is either not having a complete set of pictures or having pictures that are in the category of baggage and myths. mentoring by successful traders emerges as the way to go through the process of acquisition. This is the problem with books, they do not provide pictures. The only way to get pictures is through processing. You "see" new pictures. You make them provisional. They bump up against older ones. If you grow, you change one picture for another as a quality assurance process. Gradually you gain a new set. Once you have a complete and undistorted set, you can really roll. The single most difficult aspect of this is fear. People are safe when they "know" how to survive. Being safe and using survival pictures to escape fears, is the most common scenario. If a person glimses a new picture, it jiggles things. It may be a threat to survival at times. If a person is pretty well beat up, they fight or flee often. It takes a lot to deal with new pictures. Most people won't. Sometimes what I say here is seen as a new picture. There are a spectrum of reactions. Reaction is a consequence of experience and previously implanted pictures. People who do not get off to a good start in trading are building screwed up pictures. Bad experiences are learned and NLP pictures are welded into place. It is hell literally andit just keeps getting dug in deeper and deeper. Every damn one has to be replaced. There is no exception. To learn to trade is a process of NLP picture replacement to establish a flawless belief system. Go for it.
4. Actions. People freeze and can't act in a timely manner. People have hair triggers based on fear; these triggers come from reinforced pictures of failure. Whamo, I just blew it all when I reverted to my old way of doing things. No what really happened was there ws no picture of what to do and in the absence the person did the safe survival thing and took themselves down so they could avoid suppressing and denial stuff. The only action that is appropriate when you are in trouble, is to sideline. Then you get to do the next action. Get to work. People say around here to take a break from trading if you have a bad streak. LOL
If you have a bad streak your pictures are busted. Fix your pictures.
