Trader's Achilles heel: good at analysis/planning but bad at executions/decisions, because being reactive is easier than being decisive? Thoughts?

[Glefdar]

I'd be interested in others' perspectives about this. I have some signals that work very well, which were developed over a fairly long amount of time. I often correctly anticipate a move, meaning my analysis was right, but sometimes I fail to trade my plan. The aggravation of missing the gain that would have resulted from following the plan then sometimes results in a revenge trade that is opposite of the original plan (!).

Say for example I had a plan to buy a dip and rip open, but perhaps I didn't time the dip entry well enough to feel comfortable chasing; but (presumably to avoid the pain of a "missing out" feeling) I then go short too early into the move up, as if to convince myself that I didn't miss out because my original plan was wrong anyway.

Of course in reality, a later, riskier entry into trading my plan would have been much better than trading what was not even a plan, but was just a reaction to a failure / missed opportunity.

The most brief way to summarize and generalize the problem is: can someone have strong skill at analysis and planning, but poor skill at executing (i.e. quickly and decisively pulling the trigger in the heat of the moment)?

If so, what causes the skill gap between these two stages of making a trade?

I think that one aspect of the problem is that it's easier to pull the trigger reactively than to do so out of faith in the plan, because being reactive is easier than being decisive. Being decisive seems to be a skill unto itself that is related to emotional intelligence. What are all of your thoughts?

 

[JoeDV]

The short answer is, yes. Backtesting and paper-trading both leave out the most important factor, human emotions. So yes, you can develop a plan, and be great at analysis, but if you don't have faith to pull the trigger or to ride out a move when real money is on the line, then you'll spend a lot of time doing the coulda, woulda, shoulda game. You have to take emotions out of the game. The past is just that, the past, let it go. If you miss a trade, who cares, it won't be the last one. Lost on a trade, oh well, it's going to happen. See if there's a lesson to learn and chalk it up to experience. Win big, good for you, it's over, now move on to the next. More often than not, in my experience at least, hesitation to place a trade or exiting early is usually an indication that the person is risking more than they should be. My 2 cents.

 

[Glefdar]

Maybe nothing comes close to recreating the emotional context of trading with money on the line, but I wonder if there are particular sports or games that require quick, strategic decisiveness in opposition to reactivity.

More specifically, are there any games or sports whose core factor determining success vs. failure is the ability to be strategically decisive under time pressure, instead of being reactive (I mean, with this decisiveness being the main determinant of success, instead of merely being a peripheral component of winning)?

Seems to me that decisiveness as a form of emotional intelligence must be trained, and that it is the counterpart of patience (i.e., I think that patience is the positive complement to decisiveness, in the same way that indecisiveness - which can superficially resemble patience - is the negative complement to reactivity).

 

[conmayne]

Maybe nothing comes close to recreating the emotional context of trading with money on the line, but I wonder if there are particular sports or games that require quick, strategic decisiveness in opposition to reactivity.

More specifically, are there any games or sports whose core factor determining success vs. failure is the ability to be strategically decisive under time pressure, instead of being reactive (I mean, with this decisiveness being the main determinant of success, instead of merely being a peripheral component of winning)?

Seems to me that decisiveness as a form of emotional intelligence must be trained, and that it is the counterpart of patience (i.e., I think that patience is the positive complement to decisiveness, in the same way that indecisiveness - which can superficially resemble patience - is the negative complement to reactivity).

video games

 

[ziongotoptions]

I'd be interested in others' perspectives about this. I have some signals that work very well, which were developed over a fairly long amount of time. I often correctly anticipate a move, meaning my analysis was right, but sometimes I fail to trade my plan. The aggravation of missing the gain that would have resulted from following the plan then sometimes results in a revenge trade that is opposite of the original plan (!).

Say for example I had a plan to buy a dip and rip open, but perhaps I didn't time the dip entry well enough to feel comfortable chasing; but (presumably to avoid the pain of a "missing out" feeling) I then go short too early into the move up, as if to convince myself that I didn't miss out because my original plan was wrong anyway.

Of course in reality, a later, riskier entry into trading my plan would have been much better than trading what was not even a plan, but was just a reaction to a failure / missed opportunity.

The most brief way to summarize and generalize the problem is: can someone have strong skill at analysis and planning, but poor skill at executing (i.e. quickly and decisively pulling the trigger in the heat of the moment)?

If so, what causes the skill gap between these two stages of making a trade?

I think that one aspect of the problem is that it's easier to pull the trigger reactively than to do so out of faith in the plan, because being reactive is easier than being decisive. Being decisive seems to be a skill unto itself that is related to emotional intelligence. What are all of your thoughts?

I struggled with this, first off paper trading is a good idea, download interactive brokers and use their trading simulator, I thought I was ready to trade after using thinkorswim paper trading , but once I switched over to interactive brokers simulator, it was a rude awakening. Second the issue I would say is determining how to enter for that I recommend read al brooks book, look for setup bars, and high 1 or 2 and low 1 or 2 pullbacks, in conjunction with your plan/analysis basically need to learn price action/patterns, through repetition and success you will build confidence my rule was I would not trade live unless I was able to trade profitably for 1 month and consistently using the same size. It’s all trial and error and it takes time not easy at all

 

[antwerks]

I'd be interested in others' perspectives about this. I have some signals that work very well, which were developed over a fairly long amount of time. I often correctly anticipate a move, meaning my analysis was right, but sometimes I fail to trade my plan. The aggravation of missing the gain that would have resulted from following the plan then sometimes results in a revenge trade that is opposite of the original plan (!).

Say for example I had a plan to buy a dip and rip open, but perhaps I didn't time the dip entry well enough to feel comfortable chasing; but (presumably to avoid the pain of a "missing out" feeling) I then go short too early into the move up, as if to convince myself that I didn't miss out because my original plan was wrong anyway.

Of course in reality, a later, riskier entry into trading my plan would have been much better than trading what was not even a plan, but was just a reaction to a failure / missed opportunity.

The most brief way to summarize and generalize the problem is: can someone have strong skill at analysis and planning, but poor skill at executing (i.e. quickly and decisively pulling the trigger in the heat of the moment)?

If so, what causes the skill gap between these two stages of making a trade?

I think that one aspect of the problem is that it's easier to pull the trigger reactively than to do so out of faith in the plan, because being reactive is easier than being decisive. Being decisive seems to be a skill unto itself that is related to emotional intelligence. What are all of your thoughts?

The biggest skill gap in trading isn’t indicators; it’s knowing your levels before the market gets there.
Different traders use different tools:

• GEX
• Support and resistance
• Liquidity sweeps
• Volume profile
• VWAP
• Moving averages
• Prior highs and lows

It doesn’t matter which one you use. What matters is this:
They define decision points ahead of time and wait for price to come to them. That’s the edge.
The market is ultimately a system of human behavior:

• fear
• greed
• positioning
• reaction

Because these behaviors repeat, price tends to react at certain areas consistently — not perfectly, but often enough to build a statistical edge. These levels are not magic.
They represent:

• trapped traders
• profit-taking zones
• liquidity pools
• shifts in perceived value

The real learning curve is:

• trusting your levels
• waiting for them
• executing without hesitation when price gets there

Patience is the hardest part. Most traders lose not because they’re wrong, but because they act too early or too late. The goal is simple, define your levels then define your scenarios then wait then execute.
And remember:

• Time decay punishes hesitation
• The market doesn’t care about your position
• Discipline is the only thing that keeps you in the game

REAL EXAMPLES (THIS IS WHERE IT CLICKS)
Example 1 — VWAP Reaction

• Price trending above VWAP
• Pullback into VWAP
• Buyers step in

Why it works:

• Institutions defend value
• Late shorts get trapped

Example 2 Prior High Sweep

• Price breaks previous high
• Immediately rejects

Why it works:

• Stops get triggered (liquidity grab)
• Smart money exits into that strength

Example 3 VWAP Band (your system)

• Price extended far above VWAP
• PNVI weakening
• Vol engine showing exhaustion

Reaction: Mean reversion back to value

Example 4 Compression then Expansion

• Vol engine shows compression
• Price at key level
• Break occurs

Why - Energy release after consolidation

The truth is:

• Levels don’t predict the market
• They define where decisions matter

The edge is:

• Not being first
• Not being fast
• But being prepared and precise

 

[armybender]

Ugh... ok, so everyone so far has basically said "yeah, it's possible" but nobody is providing you specific clear guidance to move beyond it. They're talking about the technical stuff, but your issue is 0% technical and 100% biological / emotional.

How do I know this? Well, I struggled with this exact same thing for a very long time. It's the single biggest thing you'll have to overcome as a trader. It's emotion vs. intuition and skill.

Here's the problem... I'll get to the advice in a second to tell you exactly how to solve your issue.

Your brain is very good at identifying threats. Your amygdala is a very basic (early) part of your brain. 100% of sensory information passes through your amygdala before it gets to the "thinking" part of your brain, the prefrontal cortex (PFC). The PFC is the ONLY part of the brain capable of logical thinking.

But, your amygdala can cut off blood flow and electrical signals to your PFC in 0.04 seconds. That's about 1/2 the time it takes you to blink.

So, the problem is that you experience a signal ==> your brain assesses there's a potential risk ==> it shuts off your PFC ==> you either hesitate or make a stupid choice.

Overcoming this is very simple (not easy), and it takes practice. Some people are just better at it than others, so you may just have to continue to practice and reinforce this your whole life.

1. You need to observe yourself. If you cannot label your current emotional state and level of fear, you cannot trade because you don't know who's making the decision. Your prehistoric lizard brain (amygdala) or your modern monkey brain (PFC). This is harder than it sounds because humans aren't used to monitoring themselves. When was the last time you looked at the screen about to make a trade and said out loud "I'm experiencing irrational fear right now." Never.

2. Once you know your emotional state, take a single deep breath in and out. You can even start this process before your signal fully forms if your setups happen fast. Let go of whatever fear you have, and then go back and review whatever signal you just saw... but review it in a way where you can tell yourself you're just in a chart review session. Let your body calm down and focus on making that happen. If your body isn't calm your mind can't focus.

3. It's not over yet - once you've re-analyzed the setup with your PFC and you've calmed your body down, then ask yourself what the right decision is. Make sure you're using your PFC, and then execute whatever that decision is.

This is extremely simple, but very hard. Observe yourself ==> identify fear and tension ==> release fear and tension ==> re-analyze ==> re-process the decision ==> act, knowing your body is still fighting it.

If you can master this you can move beyond it and trade successfully. The key is to realize you have to master it to move beyond it, so focus on your body, not the technical setup. Your analysis is fine - your body is tricking you into bad decisions.

Master yourself... master your trades.

Good luck. I hope this helps.

 

[halcyonguy]

I'd be interested in others' perspectives about this. I have some signals that work very well, which were developed over a fairly long amount of time. I often correctly anticipate a move, meaning my analysis was right, but sometimes I fail to trade my plan. The aggravation of missing the gain that would have resulted from following the plan then sometimes results in a revenge trade that is opposite of the original plan (!).

Say for example I had a plan to buy a dip and rip open, but perhaps I didn't time the dip entry well enough to feel comfortable chasing; but (presumably to avoid the pain of a "missing out" feeling) I then go short too early into the move up, as if to convince myself that I didn't miss out because my original plan was wrong anyway.

Of course in reality, a later, riskier entry into trading my plan would have been much better than trading what was not even a plan, but was just a reaction to a failure / missed opportunity.

The most brief way to summarize and generalize the problem is: can someone have strong skill at analysis and planning, but poor skill at executing (i.e. quickly and decisively pulling the trigger in the heat of the moment)?

If so, what causes the skill gap between these two stages of making a trade?

I think that one aspect of the problem is that it's easier to pull the trigger reactively than to do so out of faith in the plan, because being reactive is easier than being decisive. Being decisive seems to be a skill unto itself that is related to emotional intelligence. What are all of your thoughts?

there is something called the 5 whys
if answered honestly, it can help to drill down to the cause of a problem.
or steer you into asking better questions, to invoke useful answers.
https://www.lean.org/lexicon-terms/5-whys/

I often correctly anticipate a move, meaning my analysis was right, but sometimes I fail to trade my plan.

ask yourself, why didn't you trade?
..are you scared to lose money?
....then make trades with smaller amounts
....if you can't afford to lose the money, you shouldn't be trading.

..are you scared of being wrong?
....everyone is wrong sometimes. the goal is to win more money than you lose. that doesn't mean winning 51% of the time. it means keeping your loses as small as possible. don't 'hold and hope' a losing trade , for a reversal. get out and move on.

..don't you trust your signals?
....stop trading, and re-evaluate them

..you don't need to chase every signal. its ok to ignore some, if you don't have the time or mindset to follow the trade.

The aggravation of missing the gain that would have resulted from following the plan then sometimes results in a revenge trade that is opposite of the original plan.

if you make trades that your plan doesn't indicate, you shouldn't be trading.

Say for example I had a plan to buy a dip and rip open, but perhaps I didn't time the dip entry well enough to feel comfortable chasing; but (presumably to avoid the pain of a "missing out" feeling) I then go short too early into the move up, as if to convince myself that I didn't miss out because my original plan was wrong anyway.

this is wrong. you are trading on a guess of a future reversal. stop trading.

can someone have strong skill at analysis and planning, but poor skill at executing

yes, most people don't have the mental strength to execute trades effectively.

If so, what causes the skill gap between these two stages of making a trade?

you need to get to a point where, you have no emotions. you treat trading like a business. you keep records of trades. it is work. it is boring. you sit and wait for a signal.


find books on the psychology of trading, not trading strategies
here are a couple threads that mention books

https://usethinkscript.com/threads/...mend-please-post-yours.861/page-2#post-150923

https://usethinkscript.com/threads/worth-reading.20835/