The way sports teams get around that, of course, is by videorecording each play and examining the video in detail to spot best and worst practices. Today's best practice is offered by reader Chris Britton, who video records his own trading and uses the review to work on his performance:
"I am a discretionary day trader and
I trade the 10 year note and 30 year bond futures. My pre-market analysis
consists of identifying key support/resistance levels (yesterday's value area
high, low, vpoc, etc). For actual trading and getting a feel for the
market action, I watch the depth of market with support from a chart to watch for
emerging support/resistance levels.
What I find helpful in doing trade
reviews is recording my trading session (using Camtasia or the like). At
the end of the day, I cut down the video to the important parts that consists
of trades that I make and trades that I missed or whatever I feel may make an
important point. Then I add in notes on the video that point out
interesting clues that I keyed in on or missed. The finished video is
anywhere from 10 to 30 minutes long depending on how many trades I make.
The key points in the video present the context of the price action, the
order flow on the depth of market that show why I entered (or did not enter),
and, in some cases, why I exited when I did.
How does this help me? First,
the recording helps me identify strengths and weaknesses in my ability to
correctly read the order flow. From that, I have built a library of my
own "best setups" or "avoidable pitfalls". For
example, I can review trades that had a successful breakout at some resistance
level and compare the order flow from those to trades that had a failed
breakout. The key element is spotting what the order flow was doing that
made the difference between the two. If my skills can't explain it, then
at least I have the library to review in the future for when my order flow
reading skills will be improved.
Second, the trade reviews at the end
of the day are actually enjoyable. Even if a trade is a loser, I enjoy
watching the video. That is because in some way, I improve my depth of market
reading skills. Before I was making recordings, I dreaded the losing trade
reviews and trying to remember what I did wrong. That opened the door for
bias to creep in which make learning from the mistakes harder. With the
recording, I learned that I can't escape my own accountability in making
errors.
Finally, play back reviews during
slow periods or on the weekends actually help keep my mind sharp and prepare me
for the next trading session. I have found that while watching these
reviews, the dialogue in my mind takes on an instructor type role where I try
to explain the play by play action."
I particularly like Chris' observation at the end, where he notes that watching reviews places him in an instructor role. That reflects the impact of self-coaching. When Chris watches the videos, he is like a coach reviewing game film with players. Going to specific portions of the video, reviewing the elements of performance in detail, and noting what could be done differently adds a level of detail to review that is impossible to replicate with a retrospective journal. As Chris notes, the reviews become enjoyable, because they are constructive--they teach--and don't simply point out negatives.
If pattern recognition is a function of cognitive focus and amount of exposure to those patterns, then a focused, video-based review is a great way to accelerate a trader's learning curve. The trader who has watched markets during the trading session and then focused on patterns in post-market review simply has more learning experience per unit of time than the trader who fails to conduct review. The video review is a powerful tool for learning and self-coaching.
Further Reading: Viewing and Reviewing Your Performance
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