Here is a good sign I need to go for a walk and move away from the screen:
Waaaay too many trades!!!
My sources of overtrading are overconfidence following a good trade that led to a better NLV, which makes me more greedy and less careful.
Today there is a sequence of important data points that are bringing volatility to equities, oil, grains and livestock and make it hard to think clearly and discriminate between best trades as opposed to just “decent” ones. “Decent” trades cause me stress and usually cost me money. It’s better to wait. And then wait some more for really good setups.
The other source of overtrading is fear or simply an attempt to make up for losses. I start seeing patterns everywhere. I get the “hussle” feeling that a team has when it’s down in the last 2 minutes of a game and plays chaotically in attempt to muster up a comeback. Shooting quick 3’s or going for long passes in football. The higher and quick reward is too enticing. Similarly, in trading, I go for tighter stops on larger positions, hoping for the same quick turnaround. Bad idea. One bucket at the time, always. That’s how you win games. One trade at the time is the way to get out of drawdowns. Fewer, more focused, less stressful, with wider stops, and smaller positions. That’s how you regain confidence and regain the feel for the market.