Nothing is quite so frustrating as planning a trade, not following the plan, and then seeing it work out--without you on board.
Why does that happen?
Kahneman's work on fast and slow thinking suggests that we have two information processing systems at work at all times. The fast system is highly efficient and responds to immediate situations; it processes information automatically. The slow system is effortful; it reflects, analyzes, and reasons. If someone gave you a challenging math problem, the fast system might respond with, "Yuck! I hate math!", while the slow system would go to work breaking the problem down.
When we plan an action, we engage our slow processing system.
When we are in the heat of battle, our fast processing kicks in.
Indeed, that fast processing can kick in when we are least aware, creating perceptual biases and shaping our behaviors.
As Mike Tyson famously said, "Everyone has a plan until they get punched in the mouth."
Harder planning, better planning, more planning--none of that will work if we are in a different mind when it comes time to execute the plan. That is why special forces teams rehearse maneuvers under simulated battle conditions; why pilots practice on realistic simulators rather than in an empty classroom. The great advantage of mental rehearsal is that you can imagine challenging situations--and evoke the reactions of your fast system--while walking yourself through the right responses.
Either you battle test your plans in rehearsal mode or they will be tested in actual battle.
Further Reading: Visualization Techniques for Traders
Why does that happen?
Kahneman's work on fast and slow thinking suggests that we have two information processing systems at work at all times. The fast system is highly efficient and responds to immediate situations; it processes information automatically. The slow system is effortful; it reflects, analyzes, and reasons. If someone gave you a challenging math problem, the fast system might respond with, "Yuck! I hate math!", while the slow system would go to work breaking the problem down.
When we plan an action, we engage our slow processing system.
When we are in the heat of battle, our fast processing kicks in.
Indeed, that fast processing can kick in when we are least aware, creating perceptual biases and shaping our behaviors.
As Mike Tyson famously said, "Everyone has a plan until they get punched in the mouth."
Harder planning, better planning, more planning--none of that will work if we are in a different mind when it comes time to execute the plan. That is why special forces teams rehearse maneuvers under simulated battle conditions; why pilots practice on realistic simulators rather than in an empty classroom. The great advantage of mental rehearsal is that you can imagine challenging situations--and evoke the reactions of your fast system--while walking yourself through the right responses.
Either you battle test your plans in rehearsal mode or they will be tested in actual battle.
Further Reading: Visualization Techniques for Traders