Monday, April 30, 2018

Trading in the Flow State: Cultivating Perceptual Creativity

I've received a number of questions about my recent post on achieving unusually strong focus in trading and the Forbes article on which that post was based.  I had outlined an unusual experience in which I used a meditation routine while tracking the ES market and then perceived the market action, not only unusually clearly, but in a very different way from my norm.  It wasn't that I was simply seeing things better or even slower (which was the case).  I was seeing the market differently.  The closest I can come to describing the experience was that I was perceiving moment to moment shifts in volatility apart from any ideas about directional price movement.  Instead of seeing price, I was *seeing* how volume was or wasn't moving price.

I placed many trades in this mode, happily capturing small swings in the market and not thinking about PL or anything about my trading.  It definitely felt like a "flow" experience, and more than a bit unsettling.

We know that stress impacts performance, but rarely do we see how we perceive and perform completely free from stress, distraction, and the interference of self-talk.  I've focused in the past on emotional creativity--the ability to adapt to situations with new responses--and I do believe that's important in changing our behavioral patterns.  What I experienced with the meditation, however, was something different.  It was perceptual creativity.  I literally saw the market differently.

Perceptual creativity is something we more usually associate with art.  A skilled artist sees their subject in a fresh way and captures that vision through the paint brush (painter) or through movement (dancer).  It is odd to think of trading as akin to art, but it may well be that it's the trader who sees what others do not is able to generate ideas and trades that others cannot see.

My hypothesis is twofold:

1)  We generate unusually high degrees of focus when we enhance one sensory modality at the expense of others.  This is the common element in various meditation practices, as well as hypnosis.  We enter a different zone when we shut off certain sensory modalities and concentrate on one.

2)  In those very high states of focus, we achieve altered states of awareness that enable us to perceive the world around us differently.

A good example of this are isolation tanks in which people float in salt water that is kept at body temperature.  There is no light, no sound, and no sensation, as you can't really feel your body when surrounded by salt water of the same temperature.  In that environment of sensory isolation, it is possible to achieve unusual focus and peace of mind.  Interestingly, when I've stepped out of the tank, the world has *looked* different to me...more vivid...more alive.  I feel separate from the world but experience a sense of awe in observing the world.  That is altered, creative perception.

It is the depth of the focus experience (which correlates with the duration of the meditation/hypnosis/isolation routine) that leads to the unusual state shift.  It is eye-opening to experience, first hand, that emptying the mind leads not to the poverty of loneliness, but the richness of solitude.  I strongly suspect that the intensification of focus within relationships (think of having a special dinner with one you love) is an important component of intimacy and connectedness.  In a state of mental clutter, we don't truly connect with others; note how, even in a world of social media and online connectedness, a significant number of people feel lonely.  Perceptual and emotional creativity keep relationships alive and renewed, and perhaps they also keep our trading fresh and adaptive.