Trading in the moment of now

Trend following is an exercise in observing and responding to the ever-present moment of now - See more at: http://www.tischendorf.com/2009/08/03/ed-seykota-quotes-trend-following-trading-wisdom/#sthash.8Kfj5iOx.dpuf

Trend following is an exercise in observing and responding to the ever-present moment of now - See more at: http://www.tischendorf.com/2009/08/03/ed-seykota-quotes-trend-following-trading-wisdom/#sthash.8Kfj5iOx.dpuf

Trend following is an exercise in observing and responding to the ever-present moment of now - See more at: http://www.tischendorf.com/2009/08/03/ed-seykota-quotes-trend-following-trading-wisdom/#sthash.8Kfj5iOx.dpuf

"Trend following is an exercise in observing and responding to the ever-present moment of now." - Ed Seykota

Psychologically, what happened an hour ago, yesterday or last week, both in the markets and with your own trading should be an irrelevance. It's in the past. What's done is done. You cannot undo your actions - good or bad.

At the same time, what might happen in an hour, tomorrow or next week is unknown - what you think may happen might not happen. As Seykota says, you need to focus on what is happening now.

There are only a few things you can do which affect your performance as a trader. These are:

• Opening an order at the market;
• Placing an order to open at a specific price level;
• Calculating and placing your trades using the correct position size and risk per trade;
• Calculating and placing your stops (either a hard stop in the system or a mental one);
• Allowing your stops to be hit, taking you out of a trade.

You cannot effect anything else, so there is little point in worrying or stressing about it. I call this 'controlling the controllable'. Constantly thinking about things in the past or the future, or what external (i.e. non-controllable) forces may do, can lead to negative emotions such as hope, fear, greed, anger, revenge etc., coming to the fore. These WILL adversely affect your performance.

Now, you need to have a plan as to what you will do should something happen, such as a certain price level being breached which may trigger an entry or an exit. That is what having a series of trading rules you follow is for. But, you will never quite know when that moment will arrive - if at all. What is critical for you as a trader is that you are prepared to act in the moment of now, both physically and psychologically, should it ever arrive.

"I really don’t care about the mistake I made three seconds ago in the market. What I care about is what I am going to do from the next moment on." - Paul Tudor Jones