How to be less impatient (through the expensive lesson of forex)

So it turns out, at the age of 30-something, I have discovered one of my greatest flaws: impatience. But being an impatient asshole makes sense when it comes to all my other problems: checking social media compulsively, giving up on projects too early, even accepting the first job offer that comes along instead of waiting for something better. Impatience has become a particularly important at the moment as I embark on yet a new journey: forex trading.

Now, I can already hear your eyes rolling out of your heads and bouncing across the floor. Forex trading is infamous for bankrupting desperate people obsessed with get-rich-quick schemes. Friends tell of stories of people losing their life savings on trading. Only idiots would do it. Even the trading software I use notes that 90% of people lose money on it. It’s a losing game that only intensely arrogant people can imagine winning.

But heck, I’m also seeking distraction and it’s nice to think about ways of actually making money instead of losing my savings to finance an app that may not lead to anywhere. If it takes off, the benefits massively outweigh the downsides (and this is really the project of my partner than my own) and it can help me free up time for projects I care more about.

So, after a couple of weeks of trading on a demo account, and testing a strategy that seems to work 70% of the time, the moment I begin using real money, I start leaking it. So far, I have personally lost £314. I’m on a losing streak.

I am not a cool, calm dog who puts on a trade and sits back and gets on with something else. I’m at the edge of my seat, heart pulsating with every rise and fall of a bar. It’s stupid. I’m emotionally ripped up. On the demo account, I was more relaxed about mistakes; but now I’m eyeing trades in real time, as opposed to letting things go. I’m also making basic mistakes, which would have been fine on a demo account, but now feel intensely stupid on live.

But this is also one of the best lessons I can learn right now: be patient. The reasons I fail are so obvious to me. While part of this is obviously just bad luck, it’s impatience, hope and greed that’s getting in my way. Forex trading is like fighting a dragon that has my face on it. Here are just some of lessons I’m learning:

  1. I’m hunting for trades
  2. Because real money is involved, I have a work day mentality attached to it. That means I want to get things done by a certain time or have accomplished a certain number of trades a day. I set my own targets instead of waiting for opportunities come my way.
  3. I do not think the rules apply to me; I base some of my decisions based on hope instead of objective factors that may impact the trade (e.g. high impact news)

But since this year began, the lesson I need to learn most is to let things play out and to be able to wait for things to happen without getting too emotionally whipped up by them. You have no control in forex trading; once you’ve placed your trade, you just have to wait to see what happens. You cannot will things up or down, no matter how hard you stare at a screen. This tendency to stare and hope and will things into reality will not make it more likely to happen.

These are two important things that I need to work on:

  1. Have patience, let things play out
  2. I do not have control over the outcomes, only the set up

This idea of not having control over outcomes is particularly important to me at the moment. It seems to permeate almost every aspect of my life. I don’t have control over everything, 100% certainty is never possible, getting emotionally whipped up over something leads to bad decision-making. You can only see how thing play out: everything else is just futile bluster.

I was cynical reading all the books that suggested that the difference between a good trader and a bad one was mindset. That seems woolly and falls into the category of positive thinking or willpower or just something altogether weirder. But now I’m seeing how mindset is impacting my performance. I’m not losing trades because my analysis is wrong; but because I’m too desperate to put trades on in the first place, making silly mistakes like ignoring high impact news or not waiting to see how a trade develops for a few bars before putting down a trade.

Trading is a waiting game, but not about waiting to see an outcome of a trade, but to put on. But a waiting game to see what trades to put on in the first place.

I’m also using this as a distraction mechanism for working on my start-up. But I realise that working on my start up will probably make me a better trader. It’s a distraction from staring at the trading software.

But there is a silver-lining to all these mistakes:

  1. I’m learning quickly
  2. The amounts I’m trading are relatively small – so not irreversible quantities
  3. I will not repeat the same avoidable mistakes again
  4. This is a hard lesson in facing my own flaws: impatience, fear and greed

So, in the space of 4 days, I’ve learned more about my psychology (at a literal cost of £314) than I have done in a lifetime.

But now I’m aware of my deep-set flaws, I need to find ways of managing them. So I think here are things that will help:

  1. Write! Express my frustration to slow me down and get some of my restless energy out
  2. Record my mistakes and create a new cheat sheet for when to trade (I’m learning by doing!)
  3. Focus on something else (yes, no excuse now, it’s time to return to my start-up after a very low motivated month)
  4. Exercise and meditation

Since the new year, I’ve been in a very flighty mood. But now it’s time to focus and cultivate patience.