Mastering the Skill off Taking Losses

It's that moment you've taken a loss, maybe two, three, four losses. Bam, bam, bam. And now you're in the hole. Suddenly, out of nowhere, there's an urgency that starts just swelling up in you. And before you know it, you're trying to claw back, you're trying to fight back, you're trying to get those losses back. You want to get back to break even. You're not even thinking about making money. Now what you're thinking about, I just need to get to break even. I need to get back to where I was. And meanwhile, you start moving your stops, you do sorts of things, you start making really dumb, stupid decisions about your trading mind and its performance. What just happened.

That'S one of the biggest problems that I see in trading today, is that they guys get pretty good. But when they get into that place where they start taking those losses and their whole mentality about taking losses and winning and all that stuff really screws around with their trading mind. And before you know it, that platitude, oh, yeah, taking losses is just part of doing the business and trading. Yeah, but that's not true when you talk to your caveman brain. That caveman brain is your ancestral brain. Your ancestral mind. It was built for thousands and thousands and thousands of years ago. The world that existed there, not the world that exists. When you're sitting in front of a computer screen. And it just so happens as your prefrontal cortex grew out of that emotional brain of yours, enormous amounts of communication was laid out from the emotional brain back into the thinking brain. But, and here's the kicker, Is that the way evolution did it? Is that the communications going back into the emotional brain, not so good. Kind of like just two little 20th century telegraph lines, that's all. When the other just has a complex neural network and you begin to see, okay, the emotional brain can overwhelm, but the emotional brain is just not about emotions like feelings. The emotional brain is really about coordination of action between you as the organism and the markets as the environment. It acts automatically to defend itself against threat. Now, what do you think happens when you experience threat? Like taking a loss, taking another loss, another loss, and then all of a sudden, you're in the hole and you want to claw back. Well, there's your emotional brain right there. Instinctually, what it's going to do is rev you up and seek to get even. It's like a big cat. A saber tooth tank has attacked and you have to attack back. And it's already got an injury and you have to, if you don't defend yourself, if you don't make it even, it's going to win and you're going to be a meal. That's what the emotional brain is thinking. It's not looking at these elaborate charts, it's not looking at when and where to get out of a. Out of a trade. It's talking survival. And there are biases built in that you wouldn't even see. You would not see them in action because you don't know to even look for them. That's one of the big problems in trading, is you don't realize you're dealing with a very primitive emotional brain. And you keep trying to think that this 21st century, no, it's built for 50, 60, 100,000. 6.5 million years of survival instinct, automatic. And that automatic means once. Once it perceives a threat, the loss, multiple losses. It sees, oh, my God, I'm being threatened. I have to, I have to fight back or I have to, I have to avoid one of the two. And in this particular case, the thinking brain was never attuned, never told about the instinctual stuff. It never saw it.

A really good story about that is one by Sherlock Holmes where he's going to a very wealthy horse owner who has had his magnificent stallion stolen. And he goes in, he looks at the place and they say, well, we don't understand how it could have happened because the dog didn't bark. There were barn hands upstairs, but they didn't hear the dog bark, so they never came. We just don't know what in the world happened.

The owner could not see that the dog not barking was in fact something really important from home's perspective. He says, well, obviously the dog knew the person who was coming and didn't see it as an intruder. Yeah, you see that he was blind and didn't know that he was blind. Same thing is happening when you're taking these losses and then suddenly you try to start making up for all the losses. You don't see you're being sucked down into the trap of revenge, trading of over trading of trying to get even. You're not seeing that because it's not present in your mind. You have to build that awareness by training. It's not. You're just not going to just do a lot of training and it's just going to become natural. No, you actually have to make an attempt to start redesigning the mind so that it is ready for that kind of stuff where it takes a loss. In my training, we look very seriously at taking losses and regulating the psychology at that moment of loss so that it doesn't compound and trip and end up into that urgency to act. You have this expectation of getting even, of winning, and then all of a sudden you're losing and the urgency comes to make up for those prior losses. That's the emotional brain. It's going to overwhelm the thinking brain and ultimately and what I teach and what you're going to have to learn is emotional regulation. You're going to have to understand that breathing and muscle tension are part of an emotion. And as you enter, if, if you, if you start using bellows breathing, intention reduction, you're going to discover that the emotion, the urgency to get back, that desperation doesn't get so bold, so strong that it takes over thinking mind friends, that's the first step. But then you really have to attune yourself and develop your emotional intelligence. Because I tell you something, you are just absolutely.

Not in a good position without understanding your emotional nature. When you're trading, you're always talking about losses, you're always talking about uncertainty. And the brain would see trading as the worst nightmare you could have possibly ever conjured up. That's going to require retraining. Not just emotional regulation, but the very nature, the beliefs that you bring about, your ability to manage uncertainty, not the ones you say you have, but the ones you see evidenced in your trading account, in that health of that trading account. It's those beliefs that have to change and most people need help doing that. It's hard work, it's hard emotional lifting. If you're interested, really about how do I build the mind for the probability management required of trading rather than the certainty management of your emotional brain? That's the big question. They just really are very different from one another. You've got six and a half million years worth of evolution that already have it stacked against you about going into fight flight when there's a threat. And in trading that's what's happening is you're, you're risking capital, you're producing threat. The emotional brain can't tell the difference between that psychological discomfort of losing a little money and save the tooth tiger attacking. You have to build that distinction in the body, in the brain. It can be done, friends, it can be done. Come learn how. Come to the website, really start checking, reading the articles, watching more videos, studying the webinars, really taking a look at it and saying, you know something, Do I really want to become the trader enough so that I'm willing to rework my mind. Rework the brain that gives rise to the mind so that it becomes intentional rather than reactive under stress. That's the deal, friends. That's when you begin to look at it and say, this is probability. This is one loss. It's unrelated to the other losses. It's just random distribution. Okay? Rather than going, I've got to get it back. I've got to make things happen. You've lost the moment. You've got to make things happen because you don't control the outcome. You control the mind that you bring to manage the uncertainty of trading. That's what you can control. Come learn more, friends. Meanwhile, have a great day, and may you find. May you find your dreams in trading. Take care.