How To Break Out of a Trading Slump

April 30, 2007 by Trader Rich 

The definition of slump that I find most fitting is "a period
of decline or deterioration."   Since trading is so psychological by
nature, this period of decline or deterioration has to be expected.  I
don't think there is anyway to avoid it, it's inevitable.  The bottom
line is that I've either been in a slump or my level of inexperience
and ability is just not sufficient for it to be called anything but
expected.  

What can you or I do (or not do) to break out of this slump?  

  1. Take steroids like athletes do.  This is certainly one way to do
    it in baseball or other sports but unfortunately in trading, there is
    no such thing.
  2. By trying harder.  This seems like a sure-fire way to prolong the
    slump and this added pressure only makes things worse.  This could lead
    to overtrading and heavier losses. 
  3. Taking a short break.  This sometimes helps me to refocus and
    takes my mind off the negativity.  This can definitely be a difference
    maker in breaking out of a slump and certainly has to be seriously
    considered as a "cure."  
  4. Take a complete inventory of why you love trading.  Personally,
    if I don't love something, I just don't want to put the time or effort
    into doing it for there to be success. 
  5. Trade in your demo account.  I feel like trading my demo account
    throughout April has helped considerably.  I've managed to take my demo
    account very seriously and I have a new fond respect for its ability to
    help me break out of a slump.
  6. Change your routine.  If you don't have a daily routine, maybe
    creating one would help and if you already have one, maybe changing it
    would make all the difference.
  7. Stop thinking in terms of winning and losing.  Focus more on
    whether your overall trading skills are improving even if you're losing
    more than you're winning. 
  8. Unstress yourself.  Do something else other than trading that can
    relieve the everyday stress of trading and life in general.  Sometimes
    I forget why I'm striving to be a full-time trader, to have more
    freedom and security to enjoy things outside of earning a living.
  9. Try something new or simpler.
  10. Find someone that can help.  This someone could be in person, in a book, or just another fellow trader.

I'm not a trading expert, nor an expert in the field of psychology
but I read a lot and breaking out of a trading slump is really no
different than breaking out of any other slump that life throws out at
you.  I think we all have the ability to break out of it because of all
the experience from past slumps that we've encountered.  If I ever want
to be a full-time trader, learning how to break out sooner than later
can make the difference in whether I'm a success or failure.   

Lately, I feel like I'm ready to break out of this slump… I just feel it. 

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Comments

2 Responses to “How To Break Out of a Trading Slump”

  1. Alex on April 30th, 2007 11:53 pm

    Human beings have their own cycles like markets do. Everything is cyclical, that’s the process. I guess we have no choice but walk through these cycles. Realizing that someday it will return. Just my 2 cents.

  2. Rich on May 1st, 2007 7:01 pm

    Thanks Alex. Your comments are always welcome.

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