Talking to Myself
I have to admit I do talk to myself at times, maybe even a lot, especially when I'm facing a loss. Let's say I'm down a bunch of points and it came as the result of a surprise move in the market. The temptation is to think, "I have to find a way to get it back." I hate ending the day down a bunch of money. However, if I give in to that thought, I am focusing on the loss and I'm no longer in the market to win, only to get back what I've lost. This is the wrong focus for any trader to have.
If I trade with my focus on making up my loss, the situation will probably get worse. I'm in a hole and if I want to get out of the hole the best thing I can do is to accept my loss and wait for my attitude to change back to trading with the purpose of winning. So this is what I do, I simply say to myself, "I'm done for the day and I'll be back tomorrow. Tomorrow will be a new day. Things will look different tomorrow." Then, I may even move to a different market to trade. There is no law that says I have to make all my winning in the market where I've just sustained a loss. I've seen so many people take a small losing situation, and turn it into a loss that is ten times the size of the original loss trying to get back what they lost.
My stopping point is two small losses in a row or one loss that is more than I anticipated having to take. Any time either of those situations occurs, I'm done. I know how much losing I can stand. So, if it happens, I get away from the market. I get away from trading, go somewhere, do something that has nothing to do with markets or trading. Because I know if I keep watching the market, I'm going to be tempted. Then the talking to myself might be, "Gosh this trade surely has my name on it, I think I'll give it a shot." But trying to get even will have distorted my thinking.