Negative Self-Talk – A Demon in the Head?

Mahatma Gandhi

Imagine yourself setting up for the next trading session, as you start your usual (trading) routine, you begin by hearing a small voice saying: “Hmm… wonder if I can ever get a good trade today?” or “Will today be one of those days again?

As you listen to that voice, you continue to open your charts and begin to start your market analysis. Within less than a minute, you hear another voice saying: “One potential set up here. Yes, meeting all the rules… BUT something is missing… Not sure what it is, let’s move on…

And you continue looking through the various markets with the same voice convincing you why you should not be taking this, that and the other trade. When you are about to finish your analysis and call it day, you hear another voice saying: “There, I knew it, nothing at all today.” – the same old voice that you’ve been hearing for days or even weeks now.

Just when you thought you were doing fine (as you managed to convince yourself that you are protecting your money), you feel uncomfortable knowing that you have missed a few good trades. Then, you hear another voice saying: “I told you trading was difficult. 

Have you been through similar situations? If not, I’m sure you can relate to what I’m talking about, can you not?

Voices in Your Trading Head

talk-to-yourselfIn case you can’t, let me clarify what I’m talking about because this is a classic example of how traders usually self-talk their way out of taking trades and, sometimes, this can go on for a long period of time. While these traders are able to rationalise their decision by thinking that they are protecting their money, they fail to realise that they are trapped in a negative self-talk scenario and they often self-talk their way out of profitable and valid trade setups.

Just to be clear, negative self talk can go in many directions too and the problems are very diverse. While the example above shows how self-talking can prevent one from taking any trades, on other occasions, it can also cause over-trading, breaking of your trading rules, trading with no proper trade size and so on. Essentially, it can affect areas where you need to make a rational decision – yes, you can see the scope of this, can you not?

Nonetheless, self-talking is not a sin and neither does it represent a demon inside yourself. In fact, this is just a mental program (see related article) that has been running for a long time and the programs have been caused by multiple factors in your life. For some, these voices represent the things your parents taught you about investing (also known as beliefs – see related article). For others, they are ideas that you inherited or built when you started to learn to trade. Hence, creating unnecessary expectations (see related article). Again, they are endless reasons for it.

Managing the Voices

Now, imagine a day when you only hear positive voices. It doesn’t have to be perfect but you know that you can always hear an encouraging and constructive voice that gives you the boost that you need when you open the charts. Imagine how good that would be?

I’m sure that’s what you really want and so does many traders out there. So here is a simple step-by-step approach to doing that.

1. Listening to the Voice

I think the very first thing you need to do (and this is before you think about managing those voices) is to be able to listen to it. Just to be clear, this is a method that I’ve used and I would highly recommend other traders to use too. However, whether it works (or not) really depends on how you approach it from the beginning.

Just to make this work better, here’s a little fun exercise for you. Read the italic sentence above one more time but, this time, pay attention to the voice inside your head. More importantly, check if you hear a voice that has a less-than-encouraging feedback or a very optimistic one, is it a positive or negative energy that you are getting?

If you get a positive energy, that’s great. If you get a negative energy, that’s great too. Because either of them would mean that you have successfully started the exercise today and it shows that you are able to listen to your voices.

You see, the voice in the head has been there since you were born. People generally fail to hear it is because the voice has blended into your day-to-day routine and that you are no longer aware of it until I started highlighting to you today. Would you agree? (and as you agree (or not agree) to my question, that’s the voice again).

2. Understand the Voice

Once you understand the first step and you understand how to listen to your voice, the next thing to do is to understand what the voice is saying.

So what does that mean?

Let’s take a step back and remind ourselves what we are dealing with here. Going back to some of my older articles, I’ve mentioned that the mind is like a 5 year old kid (see related article). If you believe that, then you should also believe that the voice in your head is the voice of a kid too.

Now, think about it, when was the last time you tried talking to a very young kid? Do you remember that, sometimes (just sometimes), the words that come out from them don’t really make sense? Right? That’s because, very often, when they are so young, they tend to make statements without thinking of its consequences, right? Hence, making those sentences can be somewhat meaningless and they are just blabbering.

More importantly, when a kid makes a mistake, do you think you would punish the kid straight away? My guess is probably not, because you want to make sense of what he/she is saying before you take action right?

In a similar way, that’s how you want to treat the voice that you get. You want to understand what the voice is telling you. Sometimes the voice is just making a neutral statement and it has nothing to do with the action that you’re about to take next.

3. Choose What to Accept

accept_rejectWhile understanding the voice will always be there, you should realise that accepting any suggestion is a choice.

I know this might sound a little weird initially but if you think about it carefully, a voice is a not a decision. When you make a decision, you make it based on all the information you have. The voice merely provides another information. And you can choose to accept or reject it. Just like how anybody can provide a suggestion but you can consciously choose to accept it or not.

For example, the next time you hear “Will today be one of those days again?” Pause for a moment, think about it and just say, “It can be or it could be a GOOD day too.

Get it? Isn’t it simple?


Make every effort to pay attention to the voice inside your head. Start with simple exercises like “yes” and “no” answers and gradually learn to hear more. Once your can do that, progress further by paying attention to what you hear just before, during and after you trade. These voices will become clearer and louder as you start to learn to listen to it.

Thank you for reading and make sure to post any questions that you may have below.


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