Practical steps to managing tilt

Have you ever built up your account for a period of weeks or months, only to erase all those profits within a day or two? Or maybe you've taken a series of losses that led you down the path of revenge trading, turning what should have been a two hour trading session into a 10 hour ordeal in the hopes of at least recouping the ever growing hole you were putting yourself in? (That's rarely a success story, btw)

If you answered 'No', then you can stop reading this article. It's not for you. But please get in touch! You'd be the first trader I've ever met that hasn't had these issues occur at least once during their trading career. I find it hard to believe in your existence 🙃, but if you do exist, I would love to hear about your experience and get some advice from you on reaching peak performance. I'm always happy to learn more about people and markets!

For the rest of you struggling folks, here is what ultimately helped me come to grips with my worst enemy: myself.

Step 1: Keep Thy mind in Hell 🔥...

In the past, whenever I'd go through tilt, it would break me so much that I'd refuse to look into it to understand what happened. I would prefer to forget the whole thing, which means the trades I took during tilt would never end up in my trading log/journal. I would let the days pass, give my mind a chance to recover from the cortisol overload and get back in the saddle again. "I simply acted irrationally, I wasn't thinking straight... I'm such a f***ing idiot! Can't believe I did that again", I'd think.

Then I'd go on my merry way, start building up my account again, until one day the cycle would repeat itself. It never crossed my mind to seriously treat this as a learning experience, to replace the self-blame with self-analysis. However, this step is crucial: YOU MUST FACE YOUR DEMONS.

The principle of Keeping your mind in Hell requires you to face your problems instead of running away into your comfy space. Put all your trades into your Trading Journal and note down carefully everything that you did wrong. Did you stray from your trading plan? Why? Did your risk management go down the drain? Why? Did you overtrade, overleverage, flip-flop between long and short positions non-stop? Why?

Do not leave any stones unturned. I know it hurts. So does any process of healing. If you ever want to break away from this cycle, there is no other way. What I did was to simply take a deep look at myself and create a "Tilt Breakdown Page". Here is mine below. Use it as an example to express your own situation.

What I do on tilt

• Start repeatedly flip-flopping between longs and shorts in a tight range, anticipating a breakout, leading to death by 1000 paper-cuts;
• Increase size to recover losses quick, to the point that every adverse tick becomes painful;
• Increase trade frequency / overtrade;
• Never stop to take a break and cool down before making any more decisions;
• Won't accept ending the day with a loss;
• Look for a home-run, for no other reason than the fact that I need one to get me back to breakeven.

What triggers it

• Work stress (most of my tilt episodes happen in days when I am stressed with work and deadlines);
• Sleep deprivation (cannot make quick and good decisions when the mind is not rested);
• Haste, not doing my pre-game planning / warm-up;
• Constant interruptions, preventing me from entering a state of flow - you need your full attention and focus to make quick decisions in the marketplace;
• Starting the day with my account in drawdown and aiming to erase it all TODAY;
• Boredom / need to engage and get my dopamine hit.

How it makes me feel

• I feel like a complete loser and lose confidence in my abilities as a trader;
• My hands sweat profusely during tilt;
• I hunch my back and get closer to my screens;
• Heart-rate quickens;
• I feel rage.

Step 2: ...and despair not 🌊

Now think about the positives. You obviously have some sort of edge, otherwise you wouldn't be able to build up your account during that extended pre-tilt period. And you have a well defined plan to manage your trades and your risk. The only thing missing is self-management. How do you manage yourself to make sure the probabilities of acting in a rational manner are the highest?

Once you have your Tilt Breakdown Page in order, it's not that hard to develop a strategy to help you deal with these problems. Even the fact of bringing all this stuff into the light of Awareness is a very big deal.

What I do is leverage the power of Mindfulness and Physical Exercise.

I never start a trading session unless I do my pre-game warm-up (marking up all my levels of interest in the markets I trade), 10 minutes of exercise and at least 15 minutes of mindful breathing. After that, I start filling in my Pre-Session Mental Checklist. It's simple and you can print out your own set of questions based on your own tilt triggers:

Pre-Session Mental Checklist

DD/MM/YYYY, London/NY/Asian Session

• On a level of 1 to 5, how relaxed are you this morning? 1/2/3/4/5
• On a level of 1 to 5, how well rested are you? 1/2/3/4/5
• Have you done your pre-game warm-up? YES/NO
• If you are in drawdown, have you fully accepted the loss? YES/NO
• Are you prepared to let go of the outcome and focus on the process? YES/NO

If I score less than 3 in either of the first two questions, I will NOT trade that session. If I have answered NO to any of the other questions, I will also NOT trade that session.

In addition, I have a Fitbit that reminds me to get up and stretch from time to time. I do get up for exercise, but at the same time use it as an anchor to get a hold of myself and assess my situation. It's an opportunity to become more aware.

I also use a session max loss limit (I trade two different sessions, the European and the US Session), which amounts to a 4R loss. If I hit that, I stop trading for the session.

Finally, whenever I feel bored and have no other hobby to go to, I scalp a demo account, just to get engaged.

I also try to be aware of my feelings and measure them against the third part of my Tilt Breakdown Page. If I find myself hunching or sweating profusely, I straighten my back, take a deep breath and then take a hard look at what I am doing. I check my Tilt Breakdown Page to make sure I'm not caught up in any of those harmful actions. If needed, I take a longer break from the screen, do some exercise and/or meditation, and come back when I feel ready.

When you are stressed, your body is flooded with cortisol. Making decisions in that state is a recipe for disaster, so DON'T WORRY ABOUT MISSING OPPORTUNITIES. Instead, be happy to avoid ruin and be able to come back in a stronger state of mind, to take advantage of the next stream of market opportunities.

I know this was a bit long, but hopefully it helps you out. Don't forget to subscribe to the newsletter if you want to receive tips like this every week.

Cheers!