Why the process is more important than the goal
Imagine that you start the month with a goal of earning 10% on your trading account. After two weeks, you are down 2000 PLN because the market did not behave as you expected. The pressure is rising, and you are making increasingly risky decisions. By the end of the month, you are down 5000 PLN. Now think about how many times you have repeated this scenario. Every lack of a plan and haste costs. Your account is shrinking, and it was supposed to be just a simple strategy for quick profit. Can you really afford to learn from your own mistakes at the cost of thousands of PLN?
When we set unrealistic goals for ourselves, our psyche begins to rebel. The expectation of quick gains causes stress, and under the influence of stress, our ability to make rational decisions dramatically decreases. Instead of sticking to the plan, we start to improvise, which leads to losses. The brain wants rewards here and now, but trading is a marathon, not a sprint.
Also read
From the experience of many traders, goals like 'I will earn 10% in a month' are detrimental. Trading makes us dependent on results instead of the process. The result is variable and unpredictable, and focusing on it leads to frustration. In the long run, it is the process, which is a systematic approach to analysis and action, that generates stable results. Without a solid foundation in the form of a system, goals remain just a dream.
Instead of setting rigid financial goals, focus on the process. Create a system that guides your actions: daily market analysis, determining entry and exit levels, risk management. This is something you have control over. Assume that your success is measured by the number of days you adhered to your plan, not by the amount you earned. Such a process is flexible and adapts to changing market conditions.
For the next week, focus on daily application of your system, regardless of the results. Note what works and what needs improvement.
The retail sales m/m report measures changes in the sales of goods and services by retailers. It is a key indicator of the economy's health, as consumer spending constitutes a large part of GDP. An increase in sales may suggest stronger demand and economic health, while a decrease may indicate weakn...
The monthly GDP growth report is a key indicator of economic health. It reflects changes in the value of goods and services produced in a given month. Readings above expectations may suggest stronger economic growth, which influences central banks' monetary policy decisions. **Watchlist:** DXY reac...
The speech of the President of the European Central Bank, Christine Lagarde, is a significant event for financial markets as it provides insights into monetary policy and the economic outlook for the eurozone. Investors analyze her words to assess future decisions regarding interest rates and the st...
PPI m/m is an indicator that measures changes in producer prices in a given month. It is an important inflation indicator that can influence monetary policy decisions. An increase in PPI may suggest inflationary pressure, which could lead to interest rate hikes by central banks. **Watchlist:** DXY ...
The Wage Price Index is an indicator that measures changes in employee wages over a given period. It is a significant indicator for assessing inflationary pressures in the economy. An increase in wages may suggest rising consumer purchasing power, which affects spending and overall economic activity...
