Why Do I Sabotage My Own Trading?

 

9/25/2025 - One of the most frustrating issues I hear from traders is that they find themselves not following their own rules.  This creates a double sense of failure in that they miss opportunities and also feel that they have sabotaged their own success.  In my own trading, this has typically occurred when fear of loss overwhelms sound planning.  Although a trade is working out, I may see very short-term price action going against me and quickly exit the trade.  Many times, that short-term countermovement is precisely where I could be adding to my position!

The cognitive techniques discussed in The Daily Trading Coach book have been especially helpful in eliminating this sabotage.  The idea behind cognitive work is that our problems occur because of how we talk to ourselves.  If we can learn to identify and challenge our negative thinking, we can distance ourselves from it and act upon our best judgement.  One variation of this work that I've written about is imagining that the things you're telling yourself are being said to you by a person you hate and who would want to see you fail.  Imagine that this enemy of yours is shouting in your ear to get out of the trade that's working for you because you might lose your profits.

What would you say to that person?  Chances are good that you would tell them to shut the f*ck up!

In other words, if someone you can't stand said to you what you're saying to you, you wouldn't buy into it.  You would clearly see that it's a sabotage.

Cognitive work helps us identify in real time how we're talking to ourselves so that we can decide whether or not to act upon it.  Many of our greatest emotional problems are because we've learned (and overlearned) negative thought patterns.  By thinking about our thinking, we can evaluate our situations more objectively and do what's right--in markets, but also in relationships and other areas of life.

I will offer more on how to change our thought processes in coming posts--