I am reading this "The Habit of Mindfulness" by Brett N. Steenbarger, the Author of Psychology of Trading, you can find his link at my Psychology Tuning Blog Rool, or you may click here to link to his blog.
This article is long, it is longer than any of the posts that I have posted so far... :) WORTH Reading.
Note: A version of this article was submitted to the Trading Markets site on 10/14/05.
"Our joy, our peace, our happiness depend very much on our practice of recognizing and transforming our habit energies. There are positive habit energies that we have to cultivate, there are negative habit energies that we have to recognize, embrace and transform. The energy with which we do these things is mindfulness.
Mindfulness is a kind of energy that helps us to be aware of what is going on. Therefore, when the habit energy shows itself, we know right away. "Hello, my little habit energy, I know you are there. I will take good care of you." In recognizing it as it is, you are in control of the situation. You don’t have to fight it; in fact the Buddha does not recommend that you fight it, because that habit energy is you, and you should not fight against yourself. You have to generate the energy of mindfulness, which is also you, and that positive energy will do the work of recognizing and embracing. Every time you embrace your habit energy, you can help it to transform a little bit.
The habit energy is a kind of seed within your consciousness, and when it becomes a source of energy, you have to recognize it. You have to bring your mindfulness into the present moment, and you just embrace that negative energy: "Hello, my negative habit energy. I know you are there. I am here for you." After maybe one or two or three minutes, that energy will go back into the form of a seed, in order to re-manifest itself later on. You have to be very alert."
Thich Nhat Hanh
Transforming Negative Habit Energies
[link to the teaching is not available, alternatively, visit: http://www.plumvillage.org/]
There is more to ourselves than our selves.
When I am trading poorly, I stop observing the market. I become convinced of a scenario, locked in a bullish or bearish stance. Though I am not psychotic, there is an important sense in which I am out of touch with reality. I convince myself there is opportunity when there is none. I feel impelled to pick a bottom in a falling market. At those points, I am driven by emotional needs that are outside my conscious awareness. The Russian philosopher and mystic G. I. Gurdjieff described people as sleeping: they walk, talk, eat, love, and work the automatic patterns and routines that we identify as our selves. That is how I trade when I trade poorly. I am operating mechanically, in a kind of sleep, impelled by forces that I do not control. I trade with my habitual self, not myself.
When I am trading normally, I closely observe the market. I watch volume at each price level to see if the market is facilitating trade or rejecting that level. I observe the proportion of volume hitting bids and the proportion lifting offers, catching swings in the short-term sentiment of large traders. I study the most recent market regimes and closely scan the correlated markets that lead my market: interest rates, oil prices, and various sectors. Throughout these observations, I am formulating hypotheses, and sometimes I test these hypotheses with trades. When I am trading normally, I behave like a scientist, using the outcomes of trades to inform me about the market and aid the reformulation of my hypotheses.
When I am trading well, I observe myself observing the market. I am aware of market action, but I am also conscious of my own reactions. My Internal Observer knows that, if I feel boredom or panic, other traders probably feel the same way. The Observer also knows my habits: that I will be tempted to pile on during breakout moves or place a trade shortly after a loser to get my money back. The Observer doesn't fight these tendencies. Instead, it dispassionately observes them even as I observe the market. I know I'm trading well when I say to myself, "Here is a place where I used to take that impulsive trade." I perceive my robotic tendencies, but they no longer control me. It is difficult to identify with a pattern and simultaneously stand apart from it as an observer. In the observing mode, I am more myself; my self recedes to the background.
Charles Tart, in his excellent book Living the Mindful Life, cited the patriot Patrick Henry as a source of spiritual wisdom for his words: "Eternal vigilance is the price of freedom." We only have free will when we activate the vigilance of self-awareness. We rarely think of trading as a spiritual discipline, but Zen Buddhists know better. Every task in life, Thich Nhat Hanh teaches, can be performed with or without awareness, from gardening to the pouring of tea. Like muscles, free will is strengthened with use. Gurdjieff used to call out to students to "Stop!" at random intervals, so that they could take the time to step outside themselves and activate self-awareness. Thich Nhat Hanh's Plum Village community in France used the ringing of bells for the same purpose. These are alarm clocks that rouse us from sleep. It is not so difficult to remember ourselves--our goals and trading plans--but it is very difficult to remember to remember. At its best, trading teaches us to awaken; it rewards consciousness and punishes habit. It beckons us to replace our selves with ourselves.
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