Monday, July 20, 2020

Controlled Aggression: Trading Like A Sniper

When I wrote the book on developing trader performance, one group that I studied intensively was military snipers.  (See this post for an overview of how good trading is like good sniper technique).  Good trading is all about the integration of aggressiveness and self-control.  The sniper is concerned, not only with the kill shot, but doing so in a way that will not be detected.  That means that the sniper must only act when reward is high relative to risk.

In practice, that means that the sniper does not simply start firing when the high-value target first appears.  The sniper waits, slows his breathing, and looks for the ideal opportunity for a lethal head shot or an unobstructed shot at center mass.  Then it's a single pull of the trigger and a quick move to another location before the enemy can figure out where the shot came from.  It's all about controlled aggression and the patience, selectivity, and self-control that leads up to the ideal shot.

A sniper who "overshoots", like a trader who overtrades, is not one with a long career.  It's not enough to wait for the "setup" to occur.  You want to wait that extra few seconds to see price confirming your idea before you fire.  You want the lethal shot.  That means you don't try to catch exact tops and bottoms:  you hold your fire until you have *reason* to believe a top or bottom has been put into place.  

A good sniper does not feel confident or anxious; a good sniper does not feel excitement or fear.  

A good sniper feels a bit of recoil.  

That's controlled aggression.

Further Reading: