What an incredible month this has been for our Forex Traders! AUD has made nice moves this month making traders excellent returns. Like September, October also promises to provide some excellent opportunities to cash in, if you are prepared to take precise action with managed risk and follow your strategies.
Mark Twain wrote ‘My life is full of misfortunes, most of which have never happened’. As funny as it may sound it is so true. Our mind gets bombarded with negative thoughts which stop us from doing things we really want to do. Luckily we have a process of reframing which can help us to live our desired life with vigour and fun. Reframing is about changing the meaning or the context of the presenting problem we are dealing with. Frame is a perspective and reframing is looking at the same situation from a different perspective.
In trading what is your biggest problem? Eg Losing confidence, trading demo and being afraid to trade live etc.. Let us learn how this simple Neuro Lingustic Programming (NLP) technique can assist you in gaining your confidence back.
Changing a frame of reference is called reframing in NLP. Imagine a picture in a frame. A frame creates boundaries around a picture that you can see and in the same way based on your beliefs, values and experiences you frame the meaning of a problem. Reframing allows us to view our actions or situation with a different perspective. Changing the frame of a situation has a major impact on how you perceive, react or give a meaning to that event.
Every thought has a hidden ‘frame’ behind it based on your underlying beliefs, values, and assumptions.
In NLP there are 2 kinds of reframes – Content and Context Reframe. A cold hard fact is that that nothing has any meaning except the meaning we give it. Let us see how you can use the above to move to the next level in your trading Psychology and empower yourself.
Content (meaning) reframe is about giving a new meaning to a situation. Content reframe is about what you choose to focus on. Eg: Loss of a stable job can be reframed as ‘A new adventure to discover my true passion’. This reframe will change the meaning and give you more power to create what you want in your life.
In NLP it is presupposed that every behaviour has a positive intention.
Therefore our unconscious mind holds onto a behaviour even if it is not producing the desired results in a specific area.
- I am not confident to trade live account so I will trade in the demo mode.
- Positive intention of this behaviour = Protect capital/ not lose money
- Reframe: When I trade live I am more attentive to my checklist & risk management rules therefore I learn faster and achieve my financial goals quicker.
- (Remind yourself) If you only played monopoly and accumulated monopoly money you wouldn’t be able to buy your dream home in real life!
Context Reframe: Almost all behaviours are useful in some context. Abruptly interrupting/ pushing and picking up a child who has run in the middle of the road is appropriate while abruptly interrupting a child while he is telling you a school story in front of his friends is not appropriate.
The context reframe is useful in a situation if you think the following statements.
I am a high risk taker so I shouldn’t trade live so soon.
Reframe: Isn’t it great that I am a high risk taker because I am able to discover new ways of making money.
Use a metaphor: I am a high risk taker, does that mean I shouldn’t drive? Well it really means that while driving I should follow the rules like speed limits, stop signs etc and being conscious of my nature I become the best driver. The same applies in trading. I am aware of my adventurous nature therefore it makes me a fantastic trader because I follow rules and manage risk even more hence it makes sense that I trade live and make money strategically.
Find the positive intention of your behaviour. Ask yourself, ‘Where is this behaviour appropriate’? In which context it is appropriate to hold back, maybe don’t follow a quick stock tip from a friend and trade on tips without knowing anything about the stock or trading..
Following is Your Assignment if you choose to accept!
Find a buddy for this role play and please write everything so you can help your buddy and in turn transform your own trading psychology.
Question sequence to explore the problem that you can reframe.
7 Step Reframe process for Traders
- What is the biggest problem you face while trading live?
- How is this a problem? (make sure your buddy understands how of the presenting problem)
- Ask them and yourself ‘What is the positive intention of this behaviour?/
- Where is this behaviour appropriate
- Find the resourcefulness of this behaviour in another context
- Reframe the context or the content
- Remember there is no failure only feedback therefore if you don’t get the desired result with your buddy or yourself, no issues. Start again. Present another reframe. A time will soon arrive when it will all click and this fear will transform into power.