Many traders are their own worst enemies. I’ve seen new traders take a great trading system and destroy it. But how? The answer lies in their self-talk. Webster defines self-talk as “one’s constant internal conversation.” Whether you realize it or not, you’re always talking to yourself. And the conversation going on in your head often dictates your actions.

For example, if you’re frustrated because you just had two losses in a row, then your self-talk may go something like this: “I can’t believe this damn market took out my stop twice, and then moved in the direction of my trade by 5 points each time! Either this trading system is awful or the market is out to get me!” Chances are, the next time you go to trade, you’ll remember the conversation you had earlier with yourself and miss out on a trade that could make up for your losses and then some.

To make sure you are using appropriate self-talk, I want to tell you exactly what NOT to say. Following is a list of the top five things a day trader should never say (out loud or internally):

1. “Ah, who cares? It’s only a sim trade.”

You must treat every trade as if you have $1,000,000 on the line. If you trade differently with Monopoly money than you do with your cash account, your trading results will always be inconsistent. To make matters worse, you’ll even develop some horrible habits. Trading can be an extremely profitable business, but only if you respect it and treat it as one. In my seven years of trading, I’ve never met a profitable “hobby trader.”

2. “I just know this market is going up (or down).”

Are you a strongly opinionated person? If so, you should read my post on why trading opinions suck. Trading is a game of probabilities. There is no way to know for sure if the market is going to do one thing or another. Sticking to a bias and disregarding what the market is trying to show you is suicide! You must always be open to quick changes in the market. If you don’t, you’ll get destroyed.

3. “This market always stops me out.”

You’re right! If you say it, it shall be so. If you focus on “how bad it is,” you’ll just get more of the same. You must first come to terms with the fact that losing is a part of trading. Anyone who tells you otherwise is lying to you. Sure, I’ve had winning streaks that have lasted weeks, but eventually we all lose. If you’re losing more than you’re winning, go back and find the reason. There’s ALWAYS a reason that can be worked out!

4. “I’m down $500 for the day. I have to go back and make it up.”

First and foremost, you need to forget about the money and focus purely on the components of your strategy. If you make trading decisions based on being positive or negative, you will surely end up negative. Trying to make your money back leads to revenge trading. If you take careless trades because you’re up 10 points for the day, you’ll probably end up giving half (or all) of it back.

5. “This trade setup looks OK, and I haven’t taken a trade in two hours.”

Boredom is one of the top killers of trading accounts. If you take trades just to do something, you’ll surely end up sorry. Just keep this in mind: You don’t need to be in a long or short trade to be actively trading. Flat is a position… and in a lot of cases, the best one to be in. Never take a trade because you’re feeling unproductive. Get up and get a glass of water, do some push-ups, or take the dog out–anything to keep yourself from doing something unwise.

The “easy part” of trading is finding a system that can make money on a consistent basis. The hard part is getting yourself to actually execute within that system. If you’d like more information on a winning trading system and a training program that can develop you into a top-level trader, check out the Emini Academy’s “MAP Trading Strategy”. We’ll show you how to take the guess work out of trading and how to master your own thoughts and actions.

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