HypnoTrading a practical guide to using hypnosis and NLP to improve your trading performance

You will be introduced to hypnotherapy, neuro-linguisticprogramming NLP and Havening as three key therapies that can help you change yourmindset and how you cope with the challenges of t

A practical guide to using hypnosis and NLP to improve

your trading performance

Catherine Stott BSc, DHP, Clinical

Hypnotherapist

First published in Great Britain in 2016

Copyright © Catherine Stott

The right of Catherine Stott to be identified as the author has been asserted in accordance with the Copyright, Design and Patents Act 1988.

Print ISBN: 978-0-85719-503-6

eBook ISBN: 978-0-85719-504-3

British Library Cataloguing in Publication Data

A CIP catalogue record for this book can be obtained from the British Library.

All rights reserved; no part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form

or by any means, electronic, mechanical, photocopying, recording, or otherwise without the prior written permission of the Publisher This book may not be lent, resold, hired out or otherwise disposed of by way of trade in any form of binding or cover other than that in which it is published without the prior written consent of the Publisher.

Whilst every effort has been made to ensure that information in this book is accurate, no liability can be accepted for any loss incurred in any way whatsoever by any person relying solely on the information contained herein.

No responsibility for loss occasioned to any person or corporate body acting or refraining to act as a result of reading material in this book can be accepted by the Publisher, by the Author, or by the employers of the Author.

About the author

Preface

Introduction

Part One An Introduction to Therapeutic Techniques

Chapter One Hypnosis, Psychotherapy and the Trader

Part Two Trading Challenges And How To Deal With Them

Chapter Two Common Client Issues

Chapter Three Understanding Your Trading Challenges

Chapter Four Coping With Losing Trades

Chapter Five Stress and Anxiety

Chapter Six Negative Self-Talk

Chapter Seven The Role of Fear

Part Three Personal Development

Chapter Eight Visualisation – Aiming for Success

Chapter Nine Affirmations

Chapter Ten Modelling Success

Chapter Eleven Boosting Confidence and Motivation

Chapter Twelve Mental Preparation and Discipline

Chapter Thirteen Your Future

Chapter Fourteen Finding a Suitable Hypnotherapist

HypnoTrading courses

ABOUT THE AUTHOR

Catherine Stott studied at the University of Reading, where she obtained a degree inPsychology She then went to work as a human factors psychologist at a science andtechnology company Her focus was predominantly on training and designing trainingsystems for human use Following this she trained as a Clinical Hypnotherapist at theRoyal Berkshire College of Clinical Hypnosis (RBCCH), obtaining a Diploma inHypnotherapy and Psychotherapy

Catherine is fully trained in hypnotherapy, suggestion therapy, hypnoanalysis,psychotherapy, Neuro-Linguistic Programming (NLP), and Emotional Freedom Technique(EFT) She is a Licentiate of the Association of Professional Hypnosis and Psychotherapy(APHP), a member of the National Council of Hypnotherapy (NCH) and one of thefirst hypnotherapists in the UK to become registered with the Complementary and NaturalHealthcare Council (CHNC) In addition to this she is also a member of the BritishPsychological Society

Catherine first began working with traders in 2010 and has developed an in-depthknowledge of trading psychology as well as how hypnotherapy, NLP and EFT can helptraders with the challenges they face

What this book covers

Trading is a minefield of psychological and emotional challenges that are oftenunderestimated It is usually only once you have started trading that you realise howmentally and emotionally involved you become and notice the complex relationship thatdevelops between the trader and the trade

This book provides you with a set of tools to help you deal with some of the commonpsychological issues in trading You will be introduced to hypnotherapy, neuro-linguisticprogramming (NLP) and Havening as three key therapies that can help you change yourmindset and how you cope with the challenges of trading and the trading environment.Specifically, this book covers four main overarching challenges that traders face:

1 Coping with losing trades

2 Stress and anxiety

3 Negative self-talk

4 The role of fear

It also looks at areas for self-development:

1 Using visualisation for success

2 How to write affirmations

3 Modelling success

4 Boosting motivation and confidence

5 Mental preparation and discipline

6 Building your future

Who this book is for

This book is for all traders who want to change how they trade and improve their success.Whether you are a novice trader who wants to trade well from the start or anexperienced trader who wants to tweak your self-belief or motivation, this book is foryou It will be useful for traders who want to:

1 Improve their trading consistency

2 Stick to their trading plan

3 Overcome fear

4 Learn how to deal with losing money

5 Take the leap from part-time trader to full-time trader

6 Trade with a calm and positive mindset

7 Have better mental preparation for trading

8 Reduce how much they lose when trading

9 Have better decision-making skills

How this book is structured

This book is broken down into three sections

The first section will introduce you to three types of therapy: hypnotherapy, NLP andHavening You will learn the basic concepts and theories behind each and the basic stepsneeded for self-hypnosis

The second section outlines common trading issues and then moves on to cover in depthfour key areas of challenge for traders These are: coping with losing trades, stress andanxiety, negative self-talk and fear

The final section contains more general self-help discussion Specifically, it covers usingvisualisation, how to write affirmations, building confidence and motivation, modellingsuccess, mental preparation and discipline

The book concludes with advice on how to choose a hypnotherapist should you wantmore help

Within each chapter, you will find a number of activities and techniques that encompasshypnotherapy, NLP or Havening These are designed to help you address the challengesthat have been identified You will be guided through each technique step by step so thatyou can practise it and use it correctly

The techniques are designed to provide you with a toolkit of psychotherapeuticapproaches that you can use as often as required to help you create the changes youwant You will find that some suit you more than others and you will learn how to adaptthe techniques outlined to address a variety of areas, both within and outside of trading

How to use this book

To make the best use of the book, firstly read through each chapter and each activitybefore you start Make sure you give yourself plenty of time There is no need to rushand, although it will be tempting to move straight to the chapters that you think apply toyou the most, work through each one in turn You can repeat each activity and technique

as often as you want or need to

Once you have completed all the activities you can then dip into the book in the future,using the relevant techniques when needed Once you are familiar with the book and theactivities, you’ll be able to bookmark those that you want to return to so you can practiseand use them as often as you need to

Within each chapter, you will see the following:

Text in italics indicates an activity where you should make notes Perhaps use anotepad specifically for the work you complete in this book; it will help you to keep all

of your notes in one place

TIPS! Specific tips are displayed in bold.

Techniques

Practical techniques are displayed in boxes They are written in a straightforward, step-by-step manner.

If you have these problems when trading then HypnoTrading can help you.

HypnoTrading is not your typical trading psychology textbook It goes a step further thandescribing problems – it guides you step-by-step through a number of self-help solutions.You will discover the power of hypnosis and how to use self-hypnosis with neuro-linguisticprogramming (NLP) and Havening, a modern psycho-sensory technique, to master yourtrading issues, help you make better trading decisions, perform in a calm and consistentmanner, and go on to improve your trading life

I have been working with traders since 2010, when I was first approached by a traderwho wanted to use hypnotherapy to help control his reactions to losing trades andimprove his levels of discipline

Working with this client, I became intrigued by trading issues and the similarities togambling, and I soon knew that I wanted to work with traders as a specialism From thispoint on, I began to develop my knowledge of trading psychology

I quickly realised there was a common set of themes that seemed to appear in my clinic

as I saw more and more traders: discipline (or lack thereof), fear, stress and how youreact to losing trades, to name but a few I realised the huge number of home-basedtraders out there in the world and the demand for my services began to grow

Having seen the brilliant effects that hypnotherapy has had on my trader clients, the nextlogical step was for me to write this book, to bring hypnotherapy and NLP techniques to awider audience of traders I want to pass on some of my knowledge and makehypnotherapy accessible to more traders

This is a practical book It is all very well knowing, for example, that you experienceanxiety whilst trading, but this book shows you how to identify those anxieties and theirimpact and how to overcome them This is hugely important for every trader because thepsychological elements of trading are well known and well documented, but there is verylittle material that deals with how to develop yourself psychologically to deal with tradingand achieve better results

The aim of this book is to help you develop your success as a trader, become moreconsistent in your approach to trading and address larger psychological elements withintrading

You can find out more about me and my practice in Wokingham, Berkshire, on my

website: HypnoTrading.co.uk

HypnoTrading offers a number of approaches that you can use to help overcome thepsychological barriers holding you back or influencing how you trade In Part One, you willfind an introduction to the various techniques that you will become acquainted with asyou progress through the book.

This introduction does not provide you with an in-depth understanding of each therapy –you don’t really need that in order to use the techniques successfully The intention is toprovide you with an insight into the therapies so you understand the basic principles, whythese techniques can work for you and how they can help to improve your trading style,techniques and ultimately success You will learn:

1 A brief history of hypnosis and hypnotherapy, what it is and how to self-hypnotise

2 An overview of neuro-linguistic programming (NLP) and how this can be combinedwith hypnosis to improve your trading

3 An introduction to Havening, a relatively new psycho-sensory technique that can beused to cope with stress, anxiety and getting over psychological blockers and losingtrades

4 How these techniques can be used by traders to deal with the issues they face

1 Hypnosis and hypnotherapy

2 The science behind hypnosis

3 A brief history of hypnosis and hypnotherapy

4 Recent scientific advances in hypnotherapy

5 Self-hypnosis

6 Psychotherapy and NLP

7 Havening: unblocking emotional barriers

8 How hypnotherapy and psychotherapy help traders

1 Hypnosis and hypnotherapy

There is much mystery, myth and scepticism surrounding hypnosis and hypnotherapy.Hypnotherapists have worked hard to ensure hypnotherapy is reputable, governed andunderstood

Hypnosis is a naturally arising state of mind that occurs in many people on a daily basis,for example during a monotonous drive on the motorway, when watching a movie orwhen we drive a familiar route and can’t remember the journey afterwards At thesetimes when we are deeply relaxed or highly focused, our conscious mind goes into aneutral state and our subconscious processing takes over This means our subconsciousmind is more accessible

Hypnosis itself is not a therapy, although one could argue that the relaxing properties ofhypnosis are very healing The therapy side comes when a trained therapist works withthe subconscious part of the mind to treat various emotional, physical and mentalailments and create beneficial changes in a person

Once direct access to the subconscious mind is possible through hypnosis, certaintherapeutic techniques, such as NLP, can then be used to initiate change within the client.This is more effective than using the techniques alone, because you are working with thesubconscious part of your mind, which is the part of you that stores the rules of your

environment and your beliefs, desires and attitudes.

Recent research has revealed that hypnotherapy is a tool that has many usefulapplications – so much so that the NHS now employ hypnotherapists, universities fundresearch into hypnotherapy and mental health charities deploy hypnotherapists to workwith various mental health issues

In short, hypnotherapy is an evidence-based therapy that has changed many lives and itcould change yours too

2 The science behind hypnosis

There is much curiosity surrounding what actually happens when someone is in ahypnotic state

There is a scientifically proven change in brain activity in a state of hypnosis Extensiveresearch using electroencephalographs (EEGs) demonstrates a boost in the lowerfrequency brainwaves associated with dreaming and sleep, and a reduction in higherfrequency brainwaves associated with being awake

Neurological research shows that activity in the right hemisphere of the brain is increasedduring hypnosis – this is the side of the brain associated with the subconscious mind Atthe same time, the activity in the left hemisphere (the logical, conscious side of thebrain) is reduced This supports the concept of the subconscious becoming moreaccessible through hypnosis

3 A brief history of hypnosis and hypnotherapy

Historically, hypnosis or various forms of it are well documented For example, there areancient Egyptian documents suggesting mass hypnotic states during certain ceremoniesand hypnosis-like descriptions of healing in Hindu texts

Western history marks Franz Mesmer as an important person in the history of hypnosis inthe 18th century Mesmer’s work is a defining point because it was the tipping point from

an occult view to a scientific view of hypnosis Mesmer was the first person to suggest arational base for the effects of hypnosis healing many ailments

In the 19th century interest began to focus on understanding the effects of hypnosis andhow they could be applied in real life Most notable in this time period was the physicianJames Esdaile, who pioneered its use in the medical field, and James Braid, whoresearched the physical and biological levels of hypnosis By the end of the 19th century,their evidence-based work led to hypnosis being accepted as a valid clinical tool for use inmedical settings and universities

The 20th century led to a movement of hypnosis away from the clinical setting tobecoming more widely available in private practice to the general public The style ofhypnosis and hypnotherapy moved from direct suggestions to indirect suggestions based

on language patterns

At the centre of this development was Milton H Erickson Erickson is the most well-known

hypnotherapist and Ericksonian hypnosis is still taught and used widely today He shapedhow hypnosis is taught and the way it is used in both the medical and the therapeuticenvironment.

Very importantly, work in hypnotherapy began to move towards understanding howhypnosis can be used to ease psychological issues such as stress, anxiety and weightproblems

4 Recent scientific advances in hypnotherapy

With funding made available for hypnotherapy within universities, the scientific study ofhypnosis is making huge advances and hypnotherapy is moving forward as a credible andwidely available evidence-based therapy

For example, Peter Whorwell, Professor of Medicine and Gastroenterology in the School ofMedicine at Manchester University, discovered and developed a method of treatingIrritable Bowel Syndrome (IBS) using hypnotherapy This method is perfect for those whohave no medical cause behind their IBS and teaches clients how to influence and controltheir gut function Hypnotherapy for IBS can relieve all symptoms of the condition,whereas medication can only ever relieve a few

Hypnotherapy has also been used to aid pain management in cancer patients, reduceanxiety and improve sleep Research into hypnotherapy for depression is also showingpositive results

5 Self-hypnosis

Many of the techniques outlined in this book are separate to self-hypnosis and can beused without it However, as hypnosis allows direct access to the subconscious part ofyour mind, using self-hypnosis will improve the success of the techniques Before we go

on to discuss the psychotherapeutic techniques in detail, this section outlines two veryeffective methods of self-hypnosis

Hypnosis is induced in situations where you have a focused state of mind or you aredeeply relaxed This is great news for traders because it means that you can be in self-hypnosis whilst you are trading and thus use that focused attention to heighten yourtrading skills and make better trades It also means you can use hypnosis before andafter trading to relax, de-stress and make positive changes to your mental attitude,psychology and trading success

I use the techniques outlined in this section, as well as many more, to help traders takecontrol of their lives and start trading more productively, to react better to inevitablelosing trades and to make greater profits Follow the instructions in this book and practisethese techniques and you will see an improvement in your trading ability Takingshortcuts, not taking it seriously or skipping bits will negatively affect the results you see

If you really want success, you have to work for it and earn it

The principles of hypnosis

The basic principles of hypnosis are as follows:

1 All hypnosis is self-hypnosis In a therapeutic setting you cannot be hypnotised ifyou don’t want to be and thus you always choose to go into hypnosis

2 There is so single hypnotic feeling Many people assume that when you are inhypnosis you must feel different, out of control somehow This simply isn’t the case.Some people feel no different at all and don’t even realise they are in hypnosis.Others feel like they are floating or sinking, or warm or cool, and some experiencetingling sensations All of these are right and normal

3 You create change Whether you are using hypnosis on your own or you see ahypnotherapist like myself, you are the one doing all the hard work to createchange This also means you are in full control at all times and can go into or comeout of hypnosis whenever you like This also means you have to want to createchange

4 There are different levels of hypnosis Some people will only ever achieve a lightstate of hypnosis, whereas other people can go into very deep levels of hypnosis.Does it matter? Not really Even in a light state of hypnosis you can create fantasticchanges For many, it just takes a few sessions before they can allow themselves to

go deeper into hypnosis and become even more relaxed

Preparing for self-hypnosis

I will now outline two different techniques to induce or ‘get into’ hypnosis There aremany different methods you could use, but I have chosen to highlight two very effectiveones You will find one method that suits you best and works for you Whilst it isimportant to practise both methods, don’t focus on those that aren’t working for you inthe long term; focus on what works well for you and what feels good

The best place to start is preparation Although you can use hypnosis almost anywhere, it

is important to be on your own Somewhere relaxed and quiet, where you won’t bedisturbed Turn off your phone, wear comfortable clothes, and make sure you are warm

or cool enough

Whilst learning and developing your skills in self-hypnosis, use a room with a comfortablechair, sofa or bed where you can sit or lie down Try to keep your arms and legsuncrossed so you don’t get uncomfortable part way through Give yourself time You’llneed at least half an hour to guide yourself into hypnosis and work through your chosentopic

Finally, prepare in advance what it is you’d like to work on Whether you just want sometime to relax and re-energise, or you want to put a bad trade behind you, or you want toimprove your winning trades – it is important to know the goal of your session to avoidbecoming distracted

Read through each method first before practising it so that you don’t have to stop to

re-read this section or think too much about what you are doing This is easy, it’s naturaland you can’t get it wrong.

The importance of a ‘safe place’

Once you are in self-hypnosis and before you start working on your goals, you’ll need tocreate a safe place This safe place is just a place in your mind where you feelcomfortable, in control and a place where there is only you and your thoughts Somepeople create a living room area, other people have a beautiful garden or a goldentranquil beach Your safe place can be somewhere you have been before that is special toyou or where you felt relaxed, or it can be created from your imagination

Create it in your mind’s eye now – think about the colours you can see, the sounds youcan hear (e.g waves, silence, birds tweeting), whether you can smell anything, what youfeel (e.g warm or cool breeze), how the bed or the chair feels as you touch it

This is invoking all of your senses and will help you gain a deeper state of hypnosis It willalso help you work with the senses that appeal to you most For example, many peoplefind it hard to create an image in their mind So instead, they use smell, sounds orthinking about how something will feel when touched You will usually have a dominance

in visual, auditory or olfactory (smell) processing and you can adapt all of the techniques

in this book to work specifically for you, depending on which it is

Here is a basic method for creating your safe place You can use this quite successfully onits own, or you can adapt it as you wish

Creating your safe place

Imagine a staircase with ten steps leading down, covered in a soft carpet in your favourite colour and design At the bottom of the staircase is a door to your own special room, a room where nobody can go but you Now count from ten down to zero and with each number take another step down that staircase, becoming more relaxed, and when you reach zero you’ll be outside that door to your room.

10, 9

8, 7 – thinking about how soft the carpet feels

6, 5 – halfway down, feeling safe and secure

4, 3

2, 1 – just one more step to zero

Picture that door in your mind now How does it look? Think about the texture of the handle When you are ready, move inside the room It’s warm, softly lit, looking exactly how you want it to look Take a moment to make it really vivid in your mind, thinking about how it feels, how it smells, and how it looks This is a room where you can make wonderful things happen for yourself, just by imagining them.

In the room is the most comfortable chair you’ve ever seen Just go over to it and sit down, relax and let your mind do all the work now as you create positive change for yourself easily Nobody wants anything from you, nobody needs anything, just relax…

Progressive relaxation

Progressive relaxation is very simply taking the time to relax each and every part of yourbody Follow this relaxation by guiding yourself into that special room and you will find

yourself deeply relaxed and able to make confident and positive changes to achievesuccess.

Below is a script that you can follow until you get used to doing it on your own For thefirst few times, just focus on learning to relax Once you have guided yourself into yoursafe place, you can either spend some time enjoying being very relaxed or simply openyour eyes to end the session

When you are feeling confident with being in hypnosis, you can pick one activity or area

to work through whilst in hypnosis Each activity in this book has been designed so thatyou can use them both in and out of hypnosis However, once you’ve mastered hypnosis,

I am confident you will always choose to use it as you will find that it brings quicker andmore effective results

Progressive relaxation

Step 1: Close your eyes Take five nice, slow, deep breaths in, breathing out slowly each time If you can, focus

on slowing the out-breath down so it lasts longer than the in-breath For example, breathe in for the count of four and out for the count of six.

Step 2: Think about a colour you find relaxing It might be a bright warm colour, a pastel colour, or a deep velvety

colour This is the colour of relaxation and as it moves over each part of your body, it will help you to relax it Perhaps you can see it or perhaps you have an awareness that it is there in your mind.

Step 3: Think about the top of your head now Move down slowly to focus on relaxing the muscles of your face:

your forehead, eyes, cheeks, mouth and jaw muscles Just let the skin settle and smooth out Focus on breathing gently, easily Bring that colour or that relaxing feeling down into your neck and shoulder muscles, down through your arms to the tips of your fingers.

Now relax your chest, moving through to your stomach muscles, into those deep muscles either side of your spine Just let them go lazy.

Think about this feeling moving down your hips and into your thigh muscles, relaxing through your knees, your calf muscles unwinding and letting the tension just drift away as you think down into your ankles and feet.

Your whole body is feeling relaxed, easy, lazy even.

Step 4: Guide yourself into your safe room.

Eye fixation

The eye fixation technique is a quicker method for dropping into hypnosis This is aMarmite technique in that some clients find it really easy to get into a wonderful state ofhypnosis, whereas others feel that although they are in hypnosis, it’s perhaps not as deep

as they’d like Practice makes perfect! Once again, don’t forget to create your safe roomonce you are deeply relaxed

Eye Fixation

Step 1: With your eyes open take five nice, slow, deep breaths in, breathing out slowly each time If you can,

focus on slowing the out-breath down so it lasts longer than the in-breath For example, breathe in for the count of four and out for the count of six.

Step 2: Pick a point on the wall or the floor and stare at it Keep your eyes focused on that point and just keep

looking at it Try to avoid blinking You’ll notice your eyes begin to feel a bit tired or strained You may find that your eyelids feel really heavy as if they want to close This is good Just keep staring at that point you have chosen.

Notice your eyelids feeling heavier and heavier.

Step 3: Once you are struggling to keep your eyes open, allow your eyelids to close and as you do, breathe out

and notice how relaxed and wonderful it feels now that your eyes are closed.

Step 4: Now that you are relaxed, keeping your eyes closed, guide yourself into your safe place.

Ending your self-hypnosis session

You cannot get stuck in hypnosis, but it is important to have a method of graduallybringing yourself back into your day Coming out of hypnosis abruptly can bedisorientating A simple method is to count back up from one to five when you are ready,opening your eyes on the count of five, or you could visualise yourself swimmingunderwater and coming to the surface and opening your eyes wide awake

Warning

Hypnosis is a perfectly normal and natural state But it is a state of relaxation andtherefore it is important to make sure you are somewhere safe You must never practisehypnosis whilst driving or operating heavy machinery, or when you are responsible forlooking after other people

6 Psychotherapy and NLP

‘Psychotherapeutic techniques’ is an all-encompassing term that includes any therapeutictechniques that work on your mind in some way These may include elements ofcognitive behavioural therapy (CBT), neuro-linguistic programming (NLP), reflection andtalking therapy This book is primarily focused on NLP so the majority of techniques thatyou’ll use come under the heading of NLP

NLP is used by hypnotherapists across the world to help create change and improve theirclients’ lives It can be used as a standalone technique or it can be combined with othertherapies When combined with hypnotherapy it can create fantastic and permanentchanges

Neuro-linguistic programming (NLP)

Your world revolves around you and, whilst you probably won’t change the world, you canchange your perception of it NLP helps you do that and do it quickly, increasing yourability to be successful in whatever you want to do

NLP has its origins in the 1970s when linguist John Grinder and mathematician RichardBandler wanted to know why some people are really good at some things and find themeasy, whilst others aren’t so good and find them hard They decided to investigate thedifference between someone who is competent at what they do and someone who isexcellent at what they do The results of this research led to the development of a variety

of techniques that now come under the umbrella of NLP

NLP is comprised of three main aspects:

1 Neuro – the way we use our senses and translate experience into conscious and

subconscious thought processes

2 Linguistic – how we use language to describe and categorise our world to

understand our experiences

3 Programming – our patterns of thought and behaviour Humans repeat patterns

of behaviour to create rules and shortcuts to process their environments

Regardless of whether a person’s ability or excellence is down to nature (genetics) ornurture (practice), NLP techniques are designed to help people develop and enhance theirmindset and behaviours and turn their competencies into excellence, no matter what theyare doing

NLP proposes three main elements to a skill or behaviour: what the person does, whatthe person thinks and what the person feels This book uses those elements, combinedwith other psychotherapeutic techniques, to help you achieve positive changes and meetyour potential as a trader

That can mean going from being able to apply the practical knowledge of how to trade totrading well all the time It can be the difference between knowing you need to controlyour emotions whilst trading and doing that in practice

Fundamentally, the NLP techniques outlined in this book are aimed at helping you tochange the way you perceive specific events within the trading environment and yourstate of mind This means you can change the way you process a losing trade, or you canreduce the fear that you feel After all, fear usually stems from our thoughts and causes aphysical and emotional reaction If you change your thoughts and your reactions then youcan change your behaviour

When you learn to trade, you are taught how to trade, how to analyse the charts, andwhat you should feel when you trade, which is nothing (a lack of emotion) You are nottaught how to think about the information presented and how to feel about the risks youare taking each time you trade This is where NLP can help you restructure the way youapproach trading from a psychological viewpoint as well as a practical one

The techniques outlined in this book were not created by me and I do not claim that theywere I have chosen to include them because they are techniques that I use with myhypnotherapy clients to help them achieve massive changes in their lives, both in tradingand in other areas

7 Havening: unblocking emotional barriers

There are occasions when we don’t know why we behave in certain ways or have certainfeelings or emotional blockers Sometimes, hypnotherapy or NLP alone can resolve thoseissues without needing to delve internally, but sometimes we need to address theunderlying causes in order to create the changes we want

There are a variety of ways you can do that Hypno-analysis or regression therapy is onemethod – it is not something that can be or should be taught in a book like this, but you

will find more information on this in the section on finding a therapist Another approach

to resolving the underlying emotional elements is to use Havening

Havening is a psycho-sensory technique that you can use to help resolve feelings andbehaviours It is a fairly recent therapy and one that has been developed from a scientificapproach The next part of this chapter outlines the basics of Havening and how you canuse it to resolve past emotional issues

You can self-haven or you can seek out a skilled therapist who uses Havening with theirclients One notable therapist is Paul McKenna, who uses Havening for a variety of clientissues

Before I go on to talk more about Havening for emotional blockers, it is important to notethat you can use Havening for fear, stress, anxiety and coping with losing trades So likehypnotherapy, it is multipurpose and you can use the guidance I give you to practise theuse of Havening in different ways

The power of touch

Havening is a breakthrough psycho-sensory and healing technique developed by DrRonald Ruden It is particularly good for working with emotional and psychologicaltrauma

Putting it very simply, Havening uses the power of touch to release serotonin (the brain’shappy hormone) and this combats the stress hormones released when thinking about orexperiencing something you find traumatic, stressful or upsetting Havening can combatthis in minutes

Event Havening combines repeated touch to various parts of the body with various eyemovements and visualisation Havening points are based on a mother’s touch and arehardwired into our bodies and brains This touch is then combined with eye movements,visualisation work and counting to break down the associations with unhappy feelings andmemories The most effective Havening points are:

The area under the eyes and across the cheeks Imagine wiping away tears – this

is the action you would use

The palms of your hands You would rub them as if wiping or washing your hands.The shoulders down to the elbows You stroke from the top of the arm down to theelbow

The specifics of how to use Event Havening will be outlined in the chapter on fear andyou’ll learn how to apply this technique to other issues as well Havening is mostfrequently used outside of hypnosis and is complementary to it However, it is possible to

go into self-hypnosis whilst Havening and this is an excellent technique for resolvingunderlying issues

For more background information on Havening, visit havening.org

8 How hypnotherapy and psychotherapy help traders

Trading success comes down to several elements: excellent methodology, execution anddecision-making, intertwined with excellent emotional and psychological control Of allthese, I believe mental preparation (psychological control) and emotional balance are themost important elements The reason that many traders fail to be a success, whateversuccess means to them, comes down to:

An inability to make a decision and stick to it

Anxiety and stress whilst trading

Poor mental preparation before trading

Not following their methodology and being inconsistent on approach

Negatively reacting to losing trades and being unable to let go of those negativeemotions

Letting fear get in the way

Hypnotherapy and NLP can help you to combat these problems This is because hypnosisallows you to access that subconscious part of your mind where change can be createdquickly and easily These changes can be made with a variety of psychotherapeutictechniques which will be outlined in the following chapters This will provide you with anexcellent set of tools that you can pick and choose from to help you achieve positivechange and success I have been working with traders since 2010 and I use thesetechniques, as well as many more, with my clients and see amazing results

Many trading books that you read or well-known successful traders that you might listen

to will tell you that if you are emotionally weak you shouldn’t trade, or that you should beable to trade without any emotion I disagree Emotions are a reaction to what ishappening in our environment and this should not be ignored However, you can easilylearn to manage your emotions Successful traders do not trade without emotion, theyjust manage emotion differently Hypnotherapy, NLP and Havening can help you harnessyour emotions, control them and put them to better use

* * *

Now that you’ve learned self-hypnosis and have an understanding of the main styles andtechniques used in this book, you can move on to working on your trading challenges

HOW TO DEAL WITH THEM

art Two is designed to help you identify your trading challenges and the potentialpsychological reasons behind them You will learn to analyse your trading pitfalls anduse a variety of techniques to combat them and improve your trading success

In particular, it covers four of the most common psychological blockers in trading Theseare: stress and anxiety, negative self-talk, fear, and reactions to losing trades

This part of the book is very practical and I suggest you take time to work through eachchapter You will need to make notes as you work through the activities Please ensureyou read through the instructions for each activity and technique in full before starting it.The topics of Part Two are:

1 Common client issues

2 Understanding your trading challenges

3 Coping with losing trades

4 Reducing stress and anxiety

5 Getting rid of fear

6 Negative self-talk

he purpose of this chapter is to introduce you to the wide variety of practical,emotional and psychological challenges that traders face This will help you to startidentifying the behaviours you display that may be affecting your trading success

Whilst there is no ‘one size fits all’ approach, these trader errors are usually caused byfear, anxiety, a lack of confidence and how you react to the trades you take Byunderstanding the mistakes you make, you can start to identify why you make them andthen use the techniques outlined in later chapters to help resolve the behaviours

Most technical or practical trading errors stem from decision-making and otherpsychological aspects that inevitably influence how you trade and the decisions youmake

Psychological barriers cause huge problems for traders – from novice home-based traders

to successful full-time professionals No matter how skilled you are or the extent of yourtrading knowledge, if you can’t overcome the psychological challenges of trading then youwill not meet your full potential and you will continue to make mistakes over and overagain

The issues covered are:

1 Lack of review

2 Focusing only on potential profit

3 Not controlling risk

4 Losing too much money

There are a number of possible reasons why traders do not review their trades:

1 Lack of time Schedule in some time every day to review trades, just as you

already make time to check charts before you trade

2 Avoidance Some traders may not realise they are using avoidance techniques.

Perhaps they don’t want to admit they made a mistake or don’t want the reality ofmoney lost to be staring them in the face Start identifying why you avoid reviewingyour trades, then brainstorm methods to address these reasons

3 Ego Whether it’s to protect their self-esteem or because they believe they know

what they are doing, a trader’s ego can seriously impede their success You need tobelieve in yourself, but also understand the need to keep learning You have toinvest time in developing your knowledge We all teeter on the brink of problemswith self-esteem at times and losing trades can obviously emphasise that feeling oflow self-worth However, by avoiding reality you are setting yourself up for a biggerfall later In fact, this is the perfect opportunity to reframe the issue – instead ofavoiding analysing failed trades and knowing you have not done well or made asilly mistake, choose to think of it as learning and developing You will review yourtrades, understand what happened and be in a better position to make decisionsand act on them in the future

4 The ‘know it all’ attitude If you blame everything and everyone else you are not

accepting responsibility for your own performance Recognise that you need tocontinue to learn and develop your skill Until you admit this to yourself, you will beunable to improve as a trader

2 Focusing only on potential profit

Successful traders analyse charts and make calculated decisions on what they hope toachieve and what they believe will happen, and how much they are prepared to risklosing They might risk 1% of their portfolio and set in place a stop loss or other strategy

to limit the downside This is all part of a long-term trading plan

However, many traders make the error of focusing on short-term ‘what if’ or ‘if only’scenarios and find themselves feeling desperate as they think about how much moneythey could make if the market direction turns again This leads to them staying in tradestoo long and, instead of taking a managed loss in keeping with a plan, they incur a lossthat then seems devastating

This focus on how much they could be making can lead to negative behaviour such asrevenge trading and trying to punish the market, or jumping into trades desperatelytrying to recoup losses

Successful traders focus on a long-term plan, not short-term profit

3 Not controlling risk

I have noticed a tendency among my clients to forget to move a stop loss to break-evenpoint on a trade, or to fail to consider this as a possibility

I was working with a trader who repeatedly incurred losses that were beyond what wasacceptable to him I asked about the possibility of moving the stop loss to break-evenduring the trade, or other ways he could protect any profits made.

My client was genuinely astonished I’d asked such a thing His mindset was focused ononly two outcomes: profit and loss There had been no consideration of making decisionslive, during the trade

We worked together on developing a confident attitude and empowering him to makedecisions and think differently about the information in front of him The change wasinstant and he stopped making huge losses and began to keep hold of his profits in tradesthat would otherwise have turned negative because he adapted his method and attitude

to make better decisions This client learned to take control of the trade rather thanletting the trade control him

4 Losing too much money

This point is very similar to the one above Many traders lose too much money Theproblem is not that they are losing trades – after all, that’s a fact of trading It’s that theamount of each loss is unacceptable to them, yet they feel unable to do anything aboutit

There will be times when losses will be extreme and unpredictable, due to a suddenevent or piece of news that was completely unexpected On the whole, though, you cantake control and make decisions about what you are prepared to risk Losing too muchmoney on a regular basis can affect your self-esteem, cause negative self-talk, increasestress and anxiety, and influence further poor decision-making For some, this is a sign ofself-sabotage, where they are subconsciously making bad decisions – perhaps deep downthey don’t believe they deserve success, or that they haven’t earned the money

One client I worked with really struggled with the feeling that she wasn’t actually working

by trading and so hadn’t earned her money Her family had raised her to believe youhave to work hard for money to earn it She didn’t see trading as a proper job and felt herprofits weren’t really earned so she didn’t deserve to make money So instead she losthuge amounts!

Within a few weeks she had changed her attitude and realised she did work hard whentrading and did deserve to make profits Upon this realisation, her decision-makingchanged and almost instantly she began to make better profits and smaller losses, beforegoing on to earn back her initial investment

5 Lack of planning

Trading plans and strategies don’t have to be complicated or long-winded However, you

do need to have one in some form This will help you focus your mind and your making

decision-Trading is your business and any good business owner has a strategy, goals and

objectives, and a plan for how they are going to achieve them The absence of a planmeans a lack of commitment to a particular strategy or method It means a lack of visionand it also means you cannot measure your success.

Traders without a plan are usually very nomadic in personality and have a tendency toexperience greater levels of stress and anxiety They are open to being negativelyaffected by trading

Here is an example trading plan I offer to my clients and ask them to populate

Trading plan

Objectives

Short term – Earn X points/pips per day

Intermediate – When consistently earning X points, increase the value by Xamount, e.g over two or three months

Long term – To be consistently making £X per year

Personal rules

I trade at these times:

I will not trade at these times:

If I incur £X losses or X number of losses per session I stop for the day

I will review my trades on a daily/weekly basis

I will do X amount of study each month

I will invest in a mindset/hypnotherapist/trading coach

No more than two losses per trading session

No more than X amount to lose per month, e.g X% of portfolio, and if making a loss like this I will re-evaluate my plan

Once I have achieved 50% of my monthly profit goal I will do X to ensure I cannot lose it

Trading specific

Outline your method and create a checklist of criteria each trade should meet before you will take it

Print off this checklist and complete it for each trade

Measure your success by the number of trades you complete where you correctly followed your methodology and plan, not just by profit

6 Unrealistic expectations

Many people go into trading because they see potential to get rich quick In reality only asmall percentage make lots of money in a short time Therefore many traders lackpatience This means they put themselves on an emotional rollercoaster

Anecdotally, take the example of football Whether you are a football fan or not, mostpeople usually watch the World Cup When you watch a match you pick a team tosupport Every time your chosen team moves close to the goal you feel your excitementrising You find yourself saying, “Go on… Good… you can score… go for it….comeon….COME ON!” and you will either end with a “Yes!” or a “No!” Your heart was racing,you may have even felt the blood pumping as you literally sat on the edge of your seat,but there are no real-life consequences for you

In this example, I am showing you the peak and trough of excitement in a harmlesssetting You want your team to win Now apply that to trading You see the trade going

up in the favoured direction You feel the excitement as it builds and all of a sudden youcan see that you could make an even bigger profit than you thought

Then the market changes direction Instead of calmly monitoring this, some traders nowfeel panic or sadness as that money slips away This can lead to them stopping the tradewith either a small profit or small loss because they don’t think the market will reverseagain Or excitement and hope takes hold and they can’t make themselves close thetrade with a good but smaller profit and instead keep hoping the market turns again.They risk eventually being stopped out with a bigger loss

It is hard to make those decisions and essentially practice and experience makes perfect.But this is also where you need to work on perspective and move into a longer-termmindset rather than looking at one trade at a time It’s also where you may need to work

on controlling your emotions and detaching yourself from the situation so you can makedecisions based on logic, your goals and your trading plan

This is also about setting realistic expectations in your trading plan It is unlikely,although not impossible, to start off with £3,000 and turn it into £300,000 within amonth This is where your trading plan can really help you As mentioned above, manytraders live off the ‘what if’ excitement of the possibilities related to trading, rather thanapproaching trading with specific goals and targets in mind

7 Panic or revenge trading

How many times have you incurred a losing trade or two and then carried on trading in adesperate attempt to get back to break-even?

Do you stop and ask yourself why you don’t stop trading immediately after the first losingtrade? How are you feeling when you jump straight in? Are you following your tradingplan or are you jumping in blind or with only half the information? Are you tradingbecause you feel a compulsion to get that money back or feel panicked? Are you angry atyourself or the market for your bad trades? Why don’t you stop and think before

Many clients I have worked with don’t even stop to ask themselves questions, analysewhat is going on or reflect on why they lost the last trade They act on impulse and withdesperation, anger or annoyance The decisions they make are influenced by how theyare feeling rather than facts

I once worked with a client who got so angry after losing a trade he would storm aroundthe house in a fury He found the only way to calm down was to take another trade and

he couldn’t relax until he had done so The cycle would continue until he made a profit Itdidn’t matter to him whether this was a small profit or whether the profit superseded thelosses he had incurred

I worked with this client on remaining calm during trades, changing how he chose toreact to losing trades and being able to take control of the situation again He was acompletely different man His home life improved because his family didn’t have to avoidhim whilst he was trading or afterwards if the trades had gone awry

He still had losing trades, but the amount he was losing each week and month wasreduced because he was able to walk away and stop jumping straight into other tradeswithout giving them full consideration He developed a new level of discipline and tookownership of the experience

8 Compulsive trading

Trading addiction or compulsion seems to affect many people Similar to the feeling ofhaving to justify profits as earnings, as discussed above, there are many traders whothink they have to take a trade every day, even if they can’t see a trade setting up Thisleads to desperate trading or trading without a strategy and plan It is also commonlyseen in people who trade around a day job and if, for whatever reason, they had to workwhen they would usually trade, they might decide to trade later on in the day to make upfor that

There is a certain reputation associated with being a trader, and certain stigmas Youneed to ignore these If it’s not an appropriate time to trade, don’t trade Wait untiltomorrow or next week If the compulsion to trade is too strong then consider why and dosomething about it The techniques outlined in later chapters will help you with this

I worked with a trader who found he would try and trade right into the evenings Hedidn’t even have a plan, but he felt that he should trade because his goals were toprovide for his family and to become a full-time trader Instead, he was taking himselffurther away from his family and from being able to leave his part-time job to trade full-time

We worked together on appropriate goal setting, removing that feeling of compulsion totrade and some time-lining methods These are methods aimed at getting a person toassess where they want to be at a future point in their life and how they can achieve this

In a matter of weeks this client went from crazy trading to only trading when appropriate

As a result, he started taking fewer trades overall and increased his proportion of

profitable trades He was sticking to when he wanted to trade rather than when he felt

he should trade He also got his evenings back to spend with his family

9 Lack of routine

Lack of routine has been mentioned in relation to the issues above, but it bears repetitionhere It is important to take control of trading rather than letting trading control you Byhaving a routine and a plan, you will learn to master trading the markets quicker andmore effectively than if you trade without a routine

TIP! As a hypnotherapist I have to be able to swap between being a therapist, a parent, a partner and a friend, on a regular basis Sometimes it can be tempting to blur the lines or it can be difficult not to take client issues home All therapists put in place basic methods to help them balance this Traders need to do the same, otherwise your brain never switches off, you don’t sleep as well and you live and breathe a focus on money Here are some tips to help you do this:

1 Trading is a job – have set times when you trade Once that time is up, switch off your computer and do something completely different.

2 Change your clothes – wear certain clothes for work and certain clothes for home life It is amazing how quickly taking off or putting on your ‘uniform’ can transform your mindset.

3 Relax when you are finished – do a quick relaxation exercise that takes only a few minutes to help clear your mind at the end of a trading session.

10 Too big a point value

This topic links well to having unrealistic expectations If you are feeling panicked andconstantly worrying about how much you might lose on a trade then consider reducingyour point value to a level you feel very comfortable with Having a lower point valuemay mean smaller profits, but this is a short-term view Your long-term view should be ongaining consistency with your trading decisions

If you reduce your point value, you’ll naturally be less anxious and therefore finddecisions easier to make whilst trading Once you are trading well at the lower pointvalue, you can increase it in small, incremental steps Master it one step at a time andyou will be more successful in the long term

The four broad challenges traders face

This is a brief insight into a variety of problems traders come across and what could becontributing towards these behaviours The following chapters address the psychological

causes of bad trading.

The table below will help you see how the errors you make might be linked to the fourkey psychological problem areas outlined in the following chapters This is just as anexample and all four topics are intertwined in a variety of ways To give you an idea, lack

of review may be due to wanting to avoid the negative self-talk associated with makingmistakes; you may feel anxious and want to move on from a trade, especially if you lostmoney; and this may be because you are afraid of failing

When talking to traders, I could probably mark every box for every issue at some point oranother However, it is useful to create some broad patterns to enable you to focus oncertain areas The table may give you an idea of particular chapters you want to paymore attention to, depending on your trading challenges

Issue Chapter 4: Coping with

Losing Trades

Chapter 5: Stress and Anxiety

Chapter 6: Negative

Self-Talk

Chapter 7: The Role of Fear

In order to create positive and constructive change, you need to know what you want tochange and why you want to change it Then you can move on to how you can changeand what you want the result to be This chapter is designed to help you analyse how youtrade, your trading behaviours, the mistakes that you make and what the resolution toeach issue might be This is to provide you with clarity on what exactly it is that you want

to change

Grab some paper and a pen Start by writing down all the bad habits, problems andchallenges you face as a trader It is important that you are honest with yourself sothat you get the best results from the exercise and don’t cheat yourself out of success.Here are a few examples of behaviours and problems traders present with day to day in

my hypnotherapy practice:

No particular methodology

Too much money per point – out of their comfort zone

Not following advice from experts

Pulling out of trades too soon

Misreading charts/missing key indicators

Ignoring their methodology

Getting caught up in the moment

Not sticking to particular times to trade/compulsion to keep checkingcharts/markets, etc., even at a non-trading time

Consistently losing trades

Taking a minimal profit just in case it might become a loss

Feeling like you have to take a trade even if nothing looks suitable

Wanting to prove others wrong/impress others

Being too focused on how much you want/need in your account – pressure

Distracted by family/relationship problems

Problems paying bills/money worries

Once you have written down all of your challenges, rate each one on a scale of one to ten– ten representing a massive influence on your trading success, one representing very

little impact This is so you know where to focus your attention.

Once you have rated each factor influencing your trading, you are ready to start breakingdown those barriers to success The second half of this activity is to write down theresolution to each individual trading problem you identified above

For example, if your trading is affected by a relationship problem the options are: fix theproblem, or be able to switch off from the problem whilst trading

Take your time to complete this and organise the results in a table like the one below inthe order from most influencing factor to least influencing factor

Challenge Resolution

By completing the above activity you are focusing your mind on creating the changes thatyou want You are seeing the problem and you are seeing the resolution Being able tovisualise what you want to achieve is an important step towards achieving it

Let’s now move on to the ‘how’ element of the book We’re going to look at variouschallenges traders face and I’ll provide techniques that can be used to overcome theseproblems

rading is guaranteed to cause you a level of cognitive and emotional confusion It isone of the most emotionally turbulent careers you can choose This is because youchoose it to make money – you hope a lot of money – yet you have to experience losingmoney on failed trades and accept that losing is all part of the process

Easier said than done, right? How are you supposed to accept and move on from losingtrades? No other job involves working at a financial loss and risking profit on a daily basisquite like trading does In this chapter you will learn:

1 Common reactions to losing trades

2 Reasons behind losing trades

3 The grief cycle

4 Grief outside of trading

5 Moving on from losing trades

6 Activity: understanding how you react to losing trades

7 Technique: affirmations – accepting that loss is inevitable

8 Technique: creating an emotional barrier

9 Technique: breathe and calm your mind

10 Technique: letting go of bad trades

11 Technique: results thinking and reframing

12 Technique: Havening to move on from a bad trade

1 Common reactions to losing trades

There are many different emotional reactions experienced when losing on a trade Hereare just some of them:

Disbelief – how can this be happening? You had done your prep work, it looked

like a great trade to take, there were no negative indicators, etc

Anxiety and stress – both during and at the end of a trade This can be linked to

the upset at losing the trade, how this might impact your portfolio, or how it mayimpact your life

Helplessness – feeling like you aren’t in control of the trading environment and

you don’t know what to do

Frustration – why has this happened? Perhaps you know you could have made a

better decision, exited the trade earlier or indeed hung on in there a bit longer forthe trade to turn

Anger – anger at yourself, anger at the market, anger at everyone else This can

be dangerous as it can lead you to revenge trading and taking your anger out onthe market, which can lead to further and bigger losses

Fear – how is this going to impact my overall trading success? Does this mean I

am a rubbish trader? How am I going to explain this? There is a fear of failing and adent to your self-esteem

Desperation – a dangerous feeling that can lead you to jump straight back into

trades in an attempt to claw back your losses This is a problem because in a highlyemotive state, you often won’t be able to think straight and process the information

in front of you As with revenge trading, you may make bad decisions, you mayignore the strategy and methodology you’ve spent time mastering, and you maymake bigger losses

All of these feelings and behaviours are natural and normal These reactions are also part

of the normal human grief cycle

This is the time when you know whether you are controlled by the trade or whether youtake control of the trade You cannot know exactly what will happen during a trade andlosses can be unexpected Nevertheless, you can take control of the trade by takingcontrol of how you behave Mastering this mindset is not easy because you’ll be goingagainst human nature, which is to avoid anything that risks harm or that is unpleasant forus

2 Reasons behind losing trades

Let’s explore reasons for losing trades Some of them are technical, and these elementscan easily be fixed with training and perhaps the use of a technical trading coach, andsome of them are psychological and behavioural, which can be fixed by using thetechniques in this book

The technical reasons include:

Trading too much money yet not having enough – it’s easy to be tempted to

stake large sums of money on trades However, if it’s the only money you havethen you can’t afford to lose it If you have a small start-up capital, start off tradingsmaller amounts

Poor risk management – not putting in place an appropriate stop-loss strategy.

How much are you prepared to lose each trade, e.g 1% of your capital? What isthe minimum profit you’d like? If you’ve met it, perhaps you can move your stop sothat in a worst-case scenario you make that minimum profit level

Indecisiveness – perhaps the trade is slow to start or you aren’t sure if you

should be day trading or swing trading So you do both and get confused Or youdon’t give the trade long enough to gain momentum

Trying to pick tops or bottoms – if the trade goes in the wrong direction, a

trader may add to the position in the hope that it will turn around, thus leavingthem open to bigger disappointment if it does not.

Psychological and behavioural include the following:

Jumping into trades or overtrading – feeling like you should trade because you

are a trader Being too confident and trying to watch multiple trades when yourattention span is limited

Not accepting responsibility for your trades – the mistakes you make are your

mistakes and your opportunities to learn and move on Nonetheless, many tradersrefuse to acknowledge their mistakes and blame the market, or a broker, orsomeone on the internet who gave a ‘good tip’

Self-sabotage – deliberately making decisions that will lead to you losing on the

trades You may be aware that you are at risk of self-sabotage or you may becompletely unaware you are doing it Quite often, self-sabotage is linked to poorself-esteem and poor self-belief

Unrealistic expectations – this is a common problem and something many

traders experience at the beginning of their trading careers You are unlikely to turn

£1,000 into £100,000 in a few months If you are looking for that big trade – youknow, the one that will make you rich in ten minutes when you have started with afew hundred pounds – you are likely to end up demotivated or taking excessiverisks out of desperation

Not sticking to plan – if you consistently jump from one method to another, or

otherwise disregard your plan, how will you develop your skill and how will youmeasure how well it really works for you?

Impulsiveness – this could be jumping into trades too soon, or having a gut

feeling it’s a sure bet so doubling your point value Not taking the time to considereach trade setup properly leads to increased likelihood of poor decision-making

Emotions – fear, stress and anxiety There is a lot of information on this topic

elsewhere in the book

3 The grief cycle

Dr Elisabeth Kübler-Ross, a pioneer in supportive methods for grief and trauma, createdthe five stages of grief: denial, anger, depression, bargaining and acceptance Kübler-Ross argued that everyone who experiences grief has to go through the stages of thecycle in order to fully process the grief and move on

This cycle can easily be applied to traders and you may find it resonates with you This isbecause losing money is obviously a loss and all losses involve a level of grief Somepeople work through the stages quickly and move on, whereas others may get stuck at aparticular stage along the way

1 Denial – have you ever avoided looking at exactly how much you’ve lost or where

your portfolio actually stands? Have you stopped trading altogether because if youaren’t trading, at least you aren’t losing money?

2 Anger – this encompasses many emotions and responses including wanting to lash

out Do you find yourself being grumpy with those around you? Are you bashing thedesk with your fist or do you start smacking the keys on your computer as youtype? Do you find it hard to shake off these feelings?

3 Depression – as discussed above, that feeling of helplessness, not knowing what

to do, hiding away from it all Do you struggle to talk to your partner about losingtrades?

4 Bargaining – this is not uncommon and many clients discuss it with me They play

and replay the trade in their minds over and over again with lots of ‘what ifs’ and ‘ifonlys’ Many traders find a level of self-talk whereby they are negotiating withthemselves, such as “Well if I can regain that loss and get my account to break-even or back to X profit, then I’ll use a different account or a different tradingmethod,” etc

5 Acceptance – this is where you aim to be To know that you have processed what

has happened, why it has happened and how you can learn from it That way, it’snot affecting you any more and you can start trading effectively again

How you react to losing trades means you could go through this process incredibly slowly,making further errors along the way Alternatively, you can choose to react differentlyand you can develop new skills to brush off losing trades and move on

4 Grief outside of trading

Before I move on from the grief cycle, I want to touch briefly on another element that caninfluence losing trades: non-trade related grief

As an example, I worked with a trader some years ago who had lost his father when hewas just a boy As an adult, it was just something that was part of his life; he didn’t reallythink about his father He came to see me because he kept making silly mistakes whilsttrading, with the result that he was showing a net loss

We spent time working on understanding what was happening whilst trading and histendency for self-sabotage Using analysis, it was revealed that my client had held onto alot of anger from when his father had passed away This was anger that his mother andother relatives had not spent time with him discussing what happened and why his fatherhad passed away, leaving him feeling unimportant and unworthy

This was a lightbulb moment for my client It was something he had never realised he felt

at a conscious level – he hadn’t realised his losing trades were down to him feelingunworthy and using avoidance behaviours to ensure he wasn’t in the limelight As soon as

he had this realisation, he let go of his anger and avoidance, and he returned the nextsession a totally different trader He started making better trading decisions, his losingtrend stopped and his profitable trades began increasing week on week He started to be

very successful.

He had been stuck in the grief cycle and had been unable to move on despite having nological and conscious awareness of this and being clueless as to how this could haveaffected his trading

This is an important point: everything in life influences how you trade, what you trade,how often you trade, how you react to losing trades and how you move on to success

5 Moving on from losing trades

The first step is to recognise that you will experience losing trades some of the time Youshould review your portfolio over the space of a month, say, rather than trade by trade.You should look to be making a profit over the medium and long term

Of course, there are steps you can take to reduce your losing trades and the amount youlose on these trades In order to improve, you first need to analyse and understand whatyou are experiencing

6 Understanding how you react to losing trades

It is important to understand what is happening whilst you trade, both from a personalperspective and the reality of the experience For example, when do your levels ofanxiety increase? What is your internal dialogue (the voice in your head)? How does thatrelate to what is happening on the screen in front of you?

Personal experience vs actual experience

On a piece of paper, outline what happens when you experience losing trades How doyou feel? How do you react? How do you behave?

Rather than just trying to recall what happened in the past, take your time with thisactivity and make notes as you experience a losing trade That way you are workingwith the reality of your reactions rather than how you think you react – which can bevery different

Move on to outline the reasons why you have lost trades – describe what is happening(e.g exiting too late, wrong direction) and why it happened These may link with youranswers above, they may overlap or they may appear very separate As with the firstpart of this activity, take your time and be honest with yourself

Now you’ve examined what’s happening emotionally and physically when you lose on atrade, you can go on to start making some changes The rest of this chapter provides afew techniques that you should work through one at a time to see which works best foryou

Before that, here are some practical tips for you to consider:

1 Use losing trades an as opportunity to learn Review the trade after a short break

Understand why it became a losing trade Were there any signals indicating youshouldn’t have entered the trade? How can you learn from it? What will you dodifferently next time? Was it part of your strategy?

2 Protect your losses and the amount you are prepared to lose Put appropriate stoplosses in place

3 Stop watching the whole trade It’s an emotional rollercoaster watching it second

by second and this could cause you to make decisions based on stress and anxietyrather than your trading plan

4 Do not focus on this one trade, look at your profile over the course of a few weeksand months Remember trading is an investment As long as you are predominantlygoing up, then smaller losing trades are nothing but opportunities to learn

5 Take a break from trading – particularly if you find you are feeling stressed andtempted to jump straight back into the next trade that comes along It rarely endswell and you will feel worse about yourself afterwards

7 Affirmations – accepting loss is inevitable

Affirmations are brilliant for helping you to change your mindset quickly and almosteffortlessly, so I have included a few here for you Affirmations can help you adjust fromseeing losing trades as completely negative to understanding and accepting them as aninevitable part of trading They allow you to give yourself positive feedback and use this

to create change An in-depth guide to writing your own affirmations can be found in PartThree

Affirmations – losing trades

Here are a number of affirmations to help you cope with losing trades The best way to use them is with hypnosis and then repeat these affirmations either quietly inside your head or spoken out loud – whichever you prefer.

self-Losing trades are part of the pathway to my trading success.

I use losing trades as an opportunity to grow and learn as a trader.

I welcome the success that comes with losing trades.

I remain calm and confident that I am a successful trader whether I make a profit or a loss.

I react with focused determination and a calm attitude whilst trading.

These affirmations have been designed to be memorable and realistic as well as deliberately aimed at helping you utilise losing trades for a more positive future.

8 Creating an emotional barrier

This technique is a powerful way to protect yourself and your emotions You can use it tostay calm during the turbulence of trading and when dealing with losing trades, and tocombat fear, stress, anxiety and other emotions during trading I personally use

something similar as a therapist to prevent me from taking on clients’ issues as my own.Transference of emotions is incredibly common in the trading domain If you lose a tradeand become angry or annoyed then you may very well carry this on into the next fewtrades This technique is designed to help prevent that.

Creating an emotional barrier will help you remain clear, focused, calm and in control ofthe trade Whilst you can’t predict what will happen during a trade, you can control yourtrading environment and this will improve your decision-making

This technique will require a number of tries to get it right because at first it will be novel

to you and you want it to become something that eventually comes instantly andnaturally to you Remember: practise, practise, practise!

Creating an emotional barrier

Step 1: Choose a barrier that suits you and spend time visualising it You do not need to use self-hypnosis for this.

Whilst you are developing your emotional barrier, hypnosis will help integrate it faster Here are some examples:

Step 2: Once you can visualise the barrier, imagine a time when something you have seen on the screen during a

trade has thrown out an unwanted emotional response from you (for example, the trade reversing direction), hitting against the barrier.

Step 3: Imagine the barrier acting as a filter so that it keeps out unwanted emotions and lets through cognition for

good decision-making.

Step 4: When you are confident that you have this barrier in mind and it is comfortable for you to bring to mind

with ease, practise using it in the trading situation Before you start to trade, get comfortable and get everything set up ready to start looking at the charts, etc.

Step 5: Just before you start your trading day, whilst in front of your computer, spend a few minutes with your

eyes closed evoking your emotional barrier Play around with it a bit to make it as real as possible Know it is there

to protect you emotionally Perhaps imagine how hard or soft it feels and how heavy it might be.

Step 6: When you are happy that it’s in place, start trading, safe in the knowledge that the barrier is there If

something is happening during a trade that’s triggering an emotional response, block this by mentally deflecting it to your barrier You’ll soon find it happens automatically and you use it less and less as you learn how to control your emotions.

9 Breathe and calm your mind

We all know how to breathe, right? Wrong!

Many people hold their breath in anticipation or find they are having short, quickenedbreaths as they watch what is happening with a trade

As you experience an increase in anxiety, stress or excitement, your breathing changes.However, we need to breathe properly to maximise the amount of oxygen in our brainsand to stop the body’s ‘fight or flight’ instinct kicking in When we breathe properly, theoxygen we need is going to the correct parts of our body and we can make better

Obviously a little adrenaline and some positive stress can be very good for us Here, I amtalking about bad levels of excitement or anxiety – you know your own levels and you’llknow when things are positive or negative

This is a simple, quick and easy technique that is often overlooked because of itssimplicity Sometimes complicated techniques are not required

Breathe and calm your mind

Step 1: Pick a memory that makes you really happy and, even better, a memory of being more relaxed If you

are struggling for a memory, pick a place or create somewhere in your mind Perhaps you find the beach to be a very calm place, or perhaps a countryside walk, lazing by a pool or fishing.

Step 2: Spend a moment thinking about your breathing Try breathing in for the count of four and out for the

count of eight (or six if eight is too much) As you slow down your out-breath, you are optimising the oxygen in your body and helping your body slow down.

Step 3: Once you have taken several breaths and feel calmer thinking about your calm memory, let your breathing

return to its normal calm pattern.

If you still aren’t calm, keep thinking about that memory and complete another four or five rounds of four and eight breathing.

If you need to, walk away and leave the room for a bit to calm down.

TIP! In the ‘Breathe and calm your mind’ activity you could use hypnosis or you could use the special place you have created just for the visualisation element whilst practising the breathing.

self-10 Letting go of bad trades

The previous techniques were aimed at protecting yourself from negative emotions andcalming yourself down The next two techniques are aimed at letting go of bad trades sothey don’t play on your mind and then moving on to become a results thinker rather than

a problems thinker

I must stress here it is very important to review all trades to understand what went welland what went wrong This will help you to learn from the trades You will develop theability to spot things that indicated you shouldn’t have taken a trade, or perhaps youexited too early or too late, as well as the times you were spot on with your decisions

It is incredibly easy to dwell on losing trades This is because humans appear to beprogrammed to look at the threats in their environment and to focus on negatives Thismeans we will do what we can to avoid experiencing that again

However, in the trading environment it is not realistic to expect to never lose One reasonmany traders take losing trades so badly is the expectation that trading leads to makingmoney, fast The ideal outcome that you are fantasising about moves further away whenyou incur a loss and this contributes towards cognitive dissonance – the mental stressand discomfort caused by two contradictory ideas happening at the same time In otherwords, “I should be making money but I’m losing money.”