Info!! When The Trading Demons Popular Off Out Of Control

The next is a straight quote (with the trader's permission) from an electronic mail I received simply a picayune spell ago. It illustrates a dilemma that many traders human face upward at around signal inwards their career:

"I was doing ok for a few days, together with thence I went dorsum to my onetime trading ways together with simply suffered a big loss of my work concern human relationship today. I committed all the the trading sins, etc double my seat size, drib dead against the trend, beingness stubborn together with concur onto a losing position. I intend I know the right means (maybe I am fooling myself), but I don't seem to hold out able to command the demon within of me together with simply can't intermission the onetime bad habits."

So let's imagine this is happening at 1 of the trading firms where I serve equally psychologist/coach? How would nosotros tackle the situation?

First off, nosotros would tackle it quickly. Times of crisis are likewise times of opportunity, when it comes to psychological change. That's when people are most motivated--and most open--to making changes. "Strike spell the Fe hot" is an apt regulation when situations experience desperate.

Second, I would straightaway found a three-way coming together amongst the trader, myself, together with the firm's chance manager. We would greatly cutting dorsum the trader's chance (i.e., trading size), thence that no farther price could hold out done to the account. "Above all else, create no harm," is a regulation that plant for physicians together with traders alike. The thought is that, amongst profit/loss (P/L) pressures removed from the equation temporarily, it is easier to focus on work patterns, their causes, together with possible solutions.

Third, I would interview the trader extensively (and detect him trading, if possible) inwards gild to seat the specific situations that are associated amongst the loss of discipline. In other words, I would inquire inwards especial near what is happening inwards markets when the trader's dependent is skillful together with what is happening when "the demon within of me" comes out. What we're looking for are *patterns* that nosotros could together with thence address amongst specific modify techniques.

Here are the patterns that I divulge to hold out most common:

1) The trading work is the final result of a broader emotional disorder - This is to a greater extent than mutual than is unremarkably recognized. About 5-7% of the population suffers from a diagnosable emotional disorder during whatever given year, amongst a similar incidence of amount role disorders. As a result, at to the lowest degree 1 inwards x traders tin displace hold out expected to experience emotional disruptions that interfere amongst trading, but are non specific to trading. These disruptions include anxiety disorders (such equally panic disorder together with generalized anxiety), mood disorders (depression), together with disorders related to attending deficits together with hyperactivity. Many of these problems tin displace hold out addressed effectively--and without debilitating side effects or addictive potential--through the role of medications. Many of them likewise create goodness from counseling/therapy assistance from a qualified professional. If the work affecting trading is likewise occurring inwards other spheres of life (relationships, work) or has predated trading experience, the odds are high that it could create goodness from professional person assistance. The proper class of activeness is to instruct a high-quality referral to a licensed professional, non a self-proclaimed trading coach.

2) The trading work is the final result of trading-specific surgical physical care for pressures - Many times traders experience surgical physical care for anxiety regarding the dubiety together with chance of markets together with the pressures to brand money. This anxiety leads them to merchandise inwards fearful ways, together with it sometimes leads them to overtrade inwards the wish to brand things run out. Many times the disruptions of trading occur during periods of drawdown together with slump, when surgical physical care for pressures instruct most acute. Common to these surgical physical care for problems are difficulties amongst negative self-talk, including self-imposed, perfectionistic pressures. The cardinal to this laid upward of problems is that they are trading-specific. Other areas of life don't exhibit the same patterns of pressure level together with disruption. Many of these concerns tin displace create goodness from self-help methods, including the cognitive together with behavioral methods that I outline inwards Coaching the Professional Trader

When Coaching Doesn't Work, Part One

When Coaching Doesn't Work, Part Two

Performance Coaching

A Referral List of Mentors together with Coaches
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Info!! Getting Off The Functioning Roller Coaster

A surprising release of traders I require heed from as well as operate amongst sense what mightiness hold out called a functioning roller-coaster. They brand coin for a while, as well as hence conk sloppy as well as overly aggressive inwards their trading. This leads to harrowing as well as frustrating losses, which inwards plough strength them to focus their efforts as well as resume trading well. Not infrequently, these traders sense several boom-and-bust cycles earlier they give out to attempt help.

The culprit inwards this scenario is overconfidence. Trading gains atomic number 82 to heightened expectations, which inwards plough facilitate overtrading. These changed expectations, ironically, atomic number 82 traders to alter how they're trading correct at the fourth dimension they're trading at their best! Instead of existence satisfied amongst their gains, they press to make more. This leads to crippling drawdowns, because they're trading almost aggressively fifty-fifty every bit they've strayed from their best trading.

My recent post focused on the importance of self-management inwards trading. Influenza A virus subtype H5N1 really perceptive reader who had experienced approximately of these trading ups as well as downs wrote to me late as well as described a scoring organization that he implemented for his trading. The organization gave him points each twenty-four hours based upon his training for the day, the lineament of his trading ideas; his execution of those ideas; as well as his management of the trades. Instead of focusing on his P/L each day, he has been emphasizing keeping his trading grade high. This has aided his consistency, as well as that has paid off inwards profitability.

Another savvy trader wrote to me as well as described how he used visualization techniques each twenty-four hours to convince himself that he was coming dorsum from a drawdown--regardless where his actual equity bend stood. By mentally rehearsing this "coming dorsum from drawdown" mode, he also kept the focus on the *process* of trading, resulting inwards his best as well as almost consistent profitability to date.

That is the paradox at the middle of trading as well as many other functioning activities. The destination is profitability, simply the best practise is to non focus on the goal. By staying connected to the processes that atomic number 82 to the goal, nosotros maintain consistency inwards our expectations, mood, as well as outlook--and that pays off inwards consistent performance.

RELATED POSTS:

Overconfidence inwards Trading

Top Reasons Traders Lose Their Discipline
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Info!! When Trading Problems Are To A Greater Extent Than Than Simply Trading Problems

I latterly wrote almost how 90% of the mental game is a business office of how nosotros trade.  Our trading practices impact us emotionally, exactly every bit our emotions impact our decision-making.

Sometimes, however, at that topographic point are realities nosotros cannot avoid if nosotros are to succeed inwards fiscal markets.  If nosotros are going through emotional problems, such every bit depression, anxiety, in addition to human relationship conflicts, these tin real much interfere alongside our concentration in addition to our powerfulness to atmospheric condition the normal ups in addition to downs of markets.

Addictive patterns too real much can create havoc inwards trading performance.  Sometimes nosotros merchandise out of require in addition to impulse, non from opportunity.

How do nosotros know when emotional disruption of decision-making mightiness survive due to larger psychological issues?  Two factors are relevant:

*  DURATION - If problems convey been occurring for an extended time, in addition to peculiarly if you lot convey encountered them at dissimilar points inwards your life, the odds are goodness that they are non simply situational.  If you lot convey experienced your problems prior to your interest alongside trading, it's worth considering that the problems are non simply trading-related ones.

*  SEVERITY - The severity of a work is the flat to which it interferes alongside many facets of life.  If a work disrupts sleeping in addition to eating, affects mood, in addition to lowers overall productivity in addition to social functioning, that's a goodness sign that it volition pervade trading every bit well.  

Notice that a work tin survive of relatively recent duration--such every bit a human relationship breakup--and soundless convey severe impacts.  Also, a work may non survive severe--we business office adequately despite it--but it tin soundless survive of long duration in addition to kicking the bucket along us from performing at our best. 

When emotional difficulties interfere alongside trading, the best course of written report of activity is to greatly (or totally) cut risk-taking in addition to devote attending to resolving the problems.  Blowing upwards a portfolio tin alone add together to stress; if stress is interfering alongside trading, it makes sense to focus on the stress earlier the trading adds to it.

In situations where human relationship problems, addictive patterns, depression, in addition to anxiety/stress come about exterior every bit good every bit within of trading, seeking the attention of a qualified professional person is oftentimes a goodness step.  It is non necessary to pursue a trading motorbus for problems that predate trading in addition to come about exterior of trading--and, indeed, many coaches lack sense in addition to expertise inwards these areas.  

If you lot detect yourself to a greater extent than focused on your problems than on markets, the best merchandise you lot tin brand is to invest inwards your emotional well-being past times getting the correct sort of help.

Further Reading:  The Greatest Cause of Trading Problems No One Talks About
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Info!! The Greatest Crusade Of Trading Problems That No 1 Talks About

Sometimes expert trading tin autumn apart together with it's non because of lack of dependent area together with planning.  It's non because of trading the incorrect data or setups.  It's non because markets convey radically changed.

No, sometimes trading tin autumn apart because nosotros are falling apart.  That is a argue for trading problems that really few mentors together with coaches address.

Consider the facts:

*  Every year, more than 1 inwards vi Americans volition sense a diagnosable emotional disorder.

*  About 6% of the population experiences a severe emotional disorder during a given year.

*  According to the World Health Organization, emotional disorders are a greater crusade of disability than whatever other medical condition, including cancer together with view disease.

*  Over 30% of the States of America population volition sense a diagnosable anxiety status during their lifetime.

*  Over 20% of the population volition sense a diagnosable mood status during their lifetime.

Don't believe it?  Consider this:

I ran a pupil counseling programme at a medical schoolhouse for nineteen years.  This was a motivated, bright, capable grouping of students.  Fully 15% of them made role of counseling services each year.  About a 3rd of that grouping utilized the services for a meaning emotional disorder.

I sincerely uncertainty that the universe of traders is whatever to a greater extent than immune to emotional problems than the universe of physicians inwards training.  If over 5% of medical students--and nearly 18% of people overall--experience a diagnosable emotional disorder inwards a given year, I suspect the same tin move said for a meaning discover of traders.

I remember coming together amongst 1 trader who had sought prior coaching, only had non industrial plant life the meetings helpful.  In our kickoff meeting, I asked a grouping of questions together with the answers I received led me to believe that the trader was experiencing a cast of bipolar disorder (bipolar 2).  The recurring mood swings were wreaking havoc amongst trading.  H5N1 consultation amongst a psychiatrist confirmed the diagnostic impression, the trader started on a course of teaching of medication together with therapy, together with presently the trading problems came to an end.

Not because of whatever fresh discipline, together with non because of whatever novel trading methods.

Sometimes an emotional employment actually is an emotional problem.

If yous are going through turmoil together with convey a theatre unit of measurement history of anxiety, depression, or other emotional problems; if yous sense those problems exterior of your trading, across dissimilar areas of your life; and/or if yous convey a personal history of emotional upheavals, regard reaching out for help.  It could move the greatest investment inwards your trading career yous could make.

Further Reading:  The Problem of Addictive Trading
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Info!! A Powerful Technique For Changing Your Trading Psychology

In the in conclusion post, nosotros took a hold back at 4 patterns that commonly demonstrate upwards when traders experience emotional challenges to their trading.  The underlying drivers of these patterns are frustration (over losses or missed trades), distorted thinking (overly optimistic/pessimistic next wins/losses), in addition to anxiety (over possibilities of losing coin or failing to brand money).  Once those triggers are activated in addition to nosotros cash inwards one's chips frustrated, overconfident, negative, or fearful, it's like shooting fish in a barrel for those states to coloring our views of markets in addition to our adjacent decisions in addition to actions.

So how tin nosotros preclude cognitive in addition to emotional triggers from sabotaging our trading?

My favorite approach addresses prevention rather than care:  non allowing country shifts to shift our trading processes.

The approach begins amongst acceptance.  We are non going to eliminate frustration, uncertainty, or mood swings.  Trading operates inwards an environs of doubtfulness in addition to risk.  That volition elicit unwanted thoughts in addition to emotions at times.  It's OK to endure human in addition to to create got human feelings.  It's going to happen.

Once nosotros select that these patterns volition crop up, nosotros tin in addition to thence actively anticipate them.  Instead of putting them out of our minds, nosotros desire to brand them our focus.

Once we're inwards that country of acceptance, nosotros desire to brand purpose of a straightforward, but powerful stress administration routine.  We take away heed to peaceful, relaxing music; closed our eyes; dull in addition to deepen our breathing; in addition to sit down real yet piece slowing downward in addition to focusing on the music.  We purpose the breathing to convey our body's degree of arousal down, in addition to nosotros purpose the closed listening to the music to intensify our cognitive focus.  Through this routine, nosotros maintain ourselves out of the "flight or fight" means of stress in addition to into a means of peaceful alertness.

The stress administration routine requires roughly practice, thence nosotros desire to repeat the exercise a few times a hateful solar daytime for several days to cash inwards one's chips practiced at reaching that peaceful alarm state.  With practice, nosotros tin focus ourselves in addition to larn ourselves out of struggle or flying means on demand.

Then, i time we've cash inwards one's chips practiced at the stress management, nosotros produce the exercise amongst the music in addition to deep breathing, but at i time nosotros add together imagery.  We imagine the challenging marketplace situations that unremarkably trigger our frustration, distorted thinking, anxiety, etc.  In other words, piece we're playing the music in addition to breathing slowly, we're vividly walking ourselves through situations where nosotros missy a trade, lose money, cash inwards one's chips into drawdown, merchandise poorly, etc.  While you're imagining those situations, you lot desire to genuinely imagine in addition to *feel* those emotional responses that create got sabotaged your trading inwards the past:  you lot desire to experience the fright or greed or frustration.

But you're at i time experiencing those emotions piece you lot are inwards control, focused in addition to relaxed.  You maintain focusing on those situations in addition to emotions until you lot tin remain inwards your calm, focused zone.  

This is an exercise you'll desire to produce every hateful solar daytime earlier the outset of trading in addition to mayhap also during midday breaks.  The repetition allows you lot to actively confront emotional challenges piece staying inwards control.  Through repeated experience, we reprogram our negative patterns of idea in addition to emotion.  We experience them, but they no longer define or command us. 

Once we've achieved a degree of credence in addition to self-control, nosotros in addition to thence add together a concluding part to our imagery work:  nosotros vividly imagine the work scenarios in addition to our negative emotional in addition to cognitive reactions to those, but at i time nosotros also vividly walk ourselves through how nosotros would similar to bargain amongst those reactions.  So, for example, nosotros mightiness imagine missing a merchandise in addition to feeling frustration in addition to thinking how stupid nosotros are in addition to and thence visualize ourselves stepping dorsum from the shroud temporarily, doing roughly deep breathing, in addition to coaching ourselves inwards a to a greater extent than constructive mode, telling ourselves that it's OK to missy something, that opportunities volition cash inwards one's chips on to arise, that the of import affair is to remain focused for hereafter opportunity, etc.

All of this mental rehearsal is also done piece we're breathing deeply in addition to like shooting fish in a barrel in addition to listening to the relaxing music piece seated inwards a yet position.  So through repeated mental rehearsal, we're imagining situations that upset us--and we're practicing ways of thinking in addition to behaving to grip those situations constructively.

The repeated mental rehearsal builds novel habit patterns for us.  As nosotros build those novel habits, nosotros tin in addition to thence experience frustrating in addition to discouraging situations inwards our trading, select a few deep breaths, in addition to engage inwards the constructive self-talk in addition to actions that we've been rehearsing.  The visualization exercises human activity equally practice, thence that nosotros are to a greater extent than prepared to sustain command during actual trading.

Over time, this accomplishes prevention.  We yet experience losses, nosotros yet create got frustrating experiences, nosotros yet experience airheaded at times, but at i time nosotros create got a laid of tools for staying calm, staying focused, in addition to staying inwards command past times responding to these challenges inwards the ways we've practiced.  Once nosotros select that emotional in addition to cognitive overreactions volition occur, it becomes easier to anticipate them in addition to bargain amongst them effectively.

Further Reading:  Performance Anxiety inwards Trading equally a Cause of Discipline Lapse

For those looking to cash inwards one's chips into greater depth into related topics, The Daily Trading Coach book contains a cookbook of psychological techniques for traders.  The Trading Psychology 2.0 book contains strategies for enhancing positive emotional experiences equally a means to buffer trading stresses.
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Info!! When Coaching Is Non The Answer

Here are a few situations that I've encountered late amongst traders:

*  H5N1 trader who showed talent but likewise tended to overtrade tried psychological exercises, journaling, reading books, in addition to speaking amongst a coach.  Upon review, the trader appeared to accept a lifelong blueprint of miserable attention.  H5N1 to a greater extent than formal evaluation did indeed uncovering evidence of an attending deficit disorder.  The trader started on a novel medication in addition to has had far greater success amongst consistency inward his trading.

*  H5N1 trader who made bad decisions during moody periods reported getting lilliputian joy from trading, despite working long hours.  H5N1 thorough evaluation institute that he was experiencing lilliputian happiness overall, fifty-fifty inward situations that usually would brand a somebody happy.  He was evaluated for a cast of depression known every bit dysthymia in addition to started on a medication.  His sleeping, eating, in addition to mood improved, every bit did his trading.

*  H5N1 trader who experienced odd winning in addition to losing streaks nearly blew upward inward his trading.  He described a blueprint of past times overuse of drugs in addition to alcohol, every bit good every bit gambling binges.  He late had been drinking to excess, specially subsequently doing good inward his trading.  He entered a computer program for addictions in addition to began viewing his trading every bit purpose of an addictive blueprint that he needed to change.

Check out the postal service on the greatest causes of trading problems that no ane talks about.

Sometimes it's non nigh "controlling your emotions", "following your plan", or whatever of the well-intended advice given past times mentors in addition to coaches.

Sometimes an emotional occupation is the number of a diagnosable disorder.   

It starts amongst a competent evaluation.

Make certain whomever y'all operate amongst is competent to perform competent evaluations.

Coaches coach.  Mentors mentor.  Very often, they are non qualified to diagnose a disorder; nor are they financially incentivized to brand referrals to medical in addition to mental wellness professionals.  When all y'all accept is a hammer, everything becomes a nail.  But non all problems that comport upon trading are trading problems.  And sometimes limitations are non simply self-imposed beliefs, but rattling existent disorders.

If you've been experiencing repeated problems in addition to self-help has non been enough, achieve out for qualified help.  It could brand a huge deviation inward your life--and inward your trading.

Further Reading:  Three Things That Can Improve Your Life Now
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Info!! Maximizing Surgery Past Times Optimizing The Surgery Environment

The recent shipping service on improving your cognitive environment suggested that surgical physical care for is non entirely a business office of talent, skill, too effort, but likewise one's surroundings.  Those surroundings include at to the lowest degree 3 elements:

1)  Our physical environment - How our infinite is position out; the resources available inwards that space; the grade to which the surroundings is comfortable, quiet, stimulating, distracting, etc.

2)  Our social environment - Who nosotros are surrounded past times too who nosotros conduct to surround ourselves with; the interactions nosotros own got alongside others, virtual too actual; the grade to which nosotros produce goodness or are hindered past times our interactions.

3)  Our cognitive environment - The information nosotros process; the grade to which nosotros filter vs. attempt information; the ways inwards which information nosotros format too physical care for our information; the sources nosotros attempt for our information.

Rarely are our environments optimized for the locomote nosotros undertake.  Partly this is because nosotros tend attribute surgical physical care for outcomes to internal factors:  our decisions, our psychological states, our research, etc.  Because nosotros don't systematically vary our environments or focus on the impacts of naturally occurring environmental changes, nosotros to a greater extent than oft than non don't appreciate the ways inwards which the basis some us impacts our decision-making too performance.

A uncomplicated event is the character too quantity of slumber nosotros boot the bucket each night.  We know from enquiry that getting the correct form of sleep, every bit good every bit the correct total of sleep, is of import to mood regulation, concentration, learning, too performance.  We likewise know that slumber is affected past times what too when nosotros consume too drink, our practise level, too our nighttime routines.  Keeping a telephone at the bedside to banking concern check on nighttime quotes is a mutual environmental pick for many coin managers--and it's i that tin rob us of the deep restorative slumber that aids adjacent hateful solar daytime performance.

One challenge traders own got inwards structuring the surroundings optimally is that trading consists of multiple activities, each of which typically requires a different environment.  For many traders, tranquility periods of deep analysis--whether past times reviewing charts, reading enquiry articles, or analyzing data--are an of import component of their agreement of markets.  Such locomote is best undertaken inwards distraction-free environments that promote sustained focus--not on the desk alongside multiple distracting screens too phones.

Conversely, most traders ask to remain on plough over of breaking developments during the trading hateful solar daytime too and then remain closely connected to news, chats, too interactions alongside colleagues.  The quiet, distraction-free environment, too then helpful to deep thinking, is non too then useful for the fast thinking of keeping upward alongside too agreement the implications of tidings releases too the dynamics of real-time marketplace movement. 

And how almost those activities inwards which traders slice together the elements of marketplace puzzles, integrating the results of both deep analysis too fast marketplace blueprint recognition?  Such synthesis--quite different from the deep dives of marketplace analysis--benefits from processing information inwards multiple ways.  We tin write journals, acquit on conversations alongside valued colleagues, or merely take away ourselves from the locomote surroundings too ponder the basis spell on a hike.  The creative physical care for of synthesis benefits from fresh interactions, fresh settings, too fresh ways of piecing together our observations--and those of others.

What is unlikely is that sitting at a desk, inwards forepart of a trading screen, volition optimize all our efforts at analysis, observation, too synthesis.  Each is a different process, too each of us engages inwards those processes inwards different ways.  If y'all uncovering yourself distracted, inefficient, a measurement behind inwards agreement markets, frustrated alongside performance, and/or undisciplined inwards your locomote routines, consider the possibility that in that location powerfulness locomote a suboptimal gibe betwixt y'all too your locomote environment.  Tracking shifts inwards your surroundings too their impact upon your surgical physical care for is a worthwhile get-go measurement inwards discovering what industrial plant best for you.

It's amazing how much nosotros tin pick upward when nosotros physical care for the correct information the correct ways inwards the correct settings.

Further Reading:  Where to Find a Trading Career
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Info!! Why Teamwork Is A Powerful Trading Tool

In a recent post, I suggested that the lineament of our downtime tin serve equally an engine for our function efforts.  The interrogation of Barbara Fredrickson too colleagues suggests that the agency this happens is that positive emotions generated from high lineament life activity both broaden our potential arrive at of thought too activity too construct novel emotional too behavioral strengths.  One of my favorite studies from this literature created a positive or negative mood inwards subjects too and thus showed them quick visual displays of information.  The subjects amongst the positive mood processed the visual data at the edges of their visual fields significantly meliorate than the subjects amongst the negative mood.  When inwards a positive state, nosotros literally broaden our perspectives too accept inwards fresh information.  When nosotros are stressed too distressed, nosotros tend to live tunnel-visioned too missy data that is correct inwards forepart of us.  How relevant is that to markets?

What I've increasingly seen is traders working inwards pods or teams, where at that topographic point are multiple eyes too ears on markets, widening the perceptual field.  An of import business office of this teamwork is to hold positivity, fifty-fifty during periods of challenging performance.  Because the correct squad members challenge ane roughly other too convey camaraderie to the workplace, the social appear of trading tin live an of import constituent of trading success.  Show me a high functioning squad too I'll demo y'all ane where belonging to the squad adds fun, support, too stimulation to trading.  It's exactly inwards such an surroundings that squad members are probable to broaden their marketplace views too construct fresh ideas too trading approaches.  

Further Reading:  A Quick Evaluation of the Emotional State of Your Trading

Info!! Trading Psychology Challenges - 9: Pessimism Too Negativity

Interesting research suggests that people are less able to intend inwards creative ways when they are inwards negative mood states.  People are besides less productive when they are downwardly inwards the dumps.  When nosotros acquire negative inwards the seem upwards of disappointing returns, nosotros tin flaming unwittingly practise a downward spiral, where nosotros throttle our insight together with productivity but when nosotros withdraw them most.

Cognitive psychologists emphasize that it is our agency of thinking nearly events, together with non entirely events themselves, that shape our emotional responses.  (See Chapter vi of The Daily Trading Coach for a position out of cognitive techniques used to reshape our emotional responses.)  When nosotros abide by ourselves mired inwards pessimism, really oftentimes it is because nosotros are telling ourselves that nosotros cannot win, that nosotros are sabotaging our ain success, etc.  Such self-talk is non constructive; past times it's nature, it can't Pb us to a solution.

As the Ward quote suggests, the respond to our challenges is non to complain or to passively promise that things volition blow over.  Our chore is to conform our sails when weather condition change.  When nosotros merchandise poorly, perchance nosotros receive got shifted inwards our ways of trading, becoming overconfident or fearful.  Alternatively, perchance we're trading inwards our commons ways, but markets themselves receive got shifted.  As we've seen inwards the final duo of years, approaches to trading that receive got worked inwards the past times (short term momentum/breakout trading, for example) tin flaming dramatically neglect when the surroundings changes radically.  Either way, when winds blow against us, nosotros withdraw to either conform ourselves or conform our trading--and sometimes both.

A helpful stride inwards breaking negativity together with pessimism is to intend of your self-talk every bit self-coaching.  We are e'er talking to ourselves nearly performance, opportunity, mistakes, together with risks.  If nosotros thought that self-talk every bit self-coaching, nosotros tin flaming inquire the questions, "How good am I coaching myself?  Would I jitney soul else inwards this way?  Would I desire an actual trading jitney talking to me the agency I'm speaking to myself?  Is this coaching actually going to displace me forward?"

The essence of cognitive hold upwards is thinking nearly our thinking.  When nosotros focus on learning together with improvement, nosotros displace ourselves forward--in trading together with inwards our psychology.

Further Reading:  Coaching Yourself for a Better Psychology

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Info!! Best Practices Inwards Trading: Using Campaign To Hit Emotional Control

We know from query that usage has a position out of wellness in addition to emotional benefits, including increased well-being in addition to improved concentration.  In spite of this, most traders piece of work inwards highly sedentary ways, seated at a desk in addition to watching screens for hours at a time.  The lack of campaign keeps us restricted to a narrow Blue Planet of heed in addition to trunk in addition to makes it hard to shift our Blue Planet when nosotros larn inwards periods of frustration or discouragement.  There are too significant wellness risks associated alongside sitting.

Today's best usage comes from Scott Garl, a long fourth dimension reader.  Scott explains how creating campaign at one's workstation tin supply multiple personal in addition to trading benefits:

"My best usage is absurdly simple, withal I haven't seen a comment on your spider web log or whatsoever other trading related spider web log or resources regarding the benefits of a stand upwards up workstation and/or treadmill workstation versus the traditional sit-down workstation.  I do know that about traders complain well-nigh the wellness problems associated alongside sitting all twenty-four hr menstruum long.

Since purchasing a treadmill workstation viii months agone (to supplement my sit-down workstation), I can't tell that my trading results bring exploded to the upside, but at that topographic point bring been noticeable improvements from using it 2-3 hours per day.  Staring at the screens at a brisk 2.4 miles per hr (as I'm doing now) has helped to alleviate ii occupation areas:  frustration trading in addition to trading out of boredom.  It's merely apparently hard to spiral into negative emotions afterward a stop-out or ii piece then physically active in addition to breathing deeply.  And it's nearly impossible to experience bored in addition to autumn prey to looking to the marketplace for action.

Additionally, I experience a pregnant creative boost, every bit I never forget to plow on my Focus At Will feed, which I ever forget to do piece sitting for about reason.  That helps to increment my mood, focus, in addition to inventiveness fifty-fifty more.  The treadmill has fifty-fifty helped alongside procrastination, every bit I tend to tackle many to-do's that commonly larn position off.  I've lost pregnant weight, bring noticeably stronger abs, in addition to bring gained musculus volume every bit a lawsuit of too using a dumbbell piece reading or evaluating marketplace patterns."

Scott's combination of piece of work in addition to usage keeps him energized piece trading.  His piece of work of the Focus At Will music in addition to the weights too keeps him mentally in addition to physically active, making it less probable that he volition larn bored during the trading day.  His insight that it is hard to lapse into negative emotions when staying physically energized is an of import one.  Controlling our bodies tin hold upwards powerful ways to give cognitive in addition to emotional control.

Further Reading:  The Performance Benefits of Exercise
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Info!! Trading In Addition To Mood

Special cheers to reader Adam for pointing out this first-class article on mood in addition to its lawsuit on leadership.

Why is this important? Because you are the leader of your ain trading business.

As the article indicates, how nosotros mean value affects how nosotros feel--and that helps to cast our actions. Moods are contagious: nosotros are less productive when nosotros are mired inward frustration in addition to powerlessness.

Trader 1 loses coin in addition to doubles downwards on efforts to receive got away lessons for learning in addition to improving trading. Trader two loses the same total of coin in addition to uses the occasion to vent disgust amongst himself in addition to unseen others that "manipulate markets". Who is to a greater extent than probable to merchandise good the adjacent day?

If yous are your ain employee, how good are yous managing yourself? What sort of morale create yous keep inward *your* trading business?

Adam says it much improve than I do: "Markets are mirrors that demo us to ourselves the agency the footing sees us."

More:

Overcoming Mood Problems inward Trading

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Info!! Trading Stress, Burnout, As Well As Renewing Our Emotional Fuel

A spell dorsum I wrote a post service on the theme of what stresses traders out. When traders expression upward high levels of emotional stress over time, the resultant tin last a bird of burnout. Overwhelmed yesteryear obstacles together with challenges, traders close down. They halt learning, together with they halt taking the actions needed to displace their progress forward.

In a yesteryear post, I highlighted five signs of psychological burnout amid traders. Many times, that burnout results when trading is no longer providing a feel of work together with accomplishment. When traders lose sight of the procedure of trading--and improvements they're making inwards their trading processes--it becomes tardily to autumn into a oestrus where P/L dictates mood. That tin brand slumps rattling hard to endure.

Very often, it's non but the stresses of markets that overload traders; it's too the stresses that traders tin impose upon themselves. It's tardily for achievement-oriented traders to decease their ain worst enemies when they're non making money: instead of focusing on constructive improvements, they compaction upward on themselves together with add together self-imposed stress to trading pressures.

Changing our self-talk tin last a rattling effective means of defusing stress. The primal is to decease a skillful observer of our ain idea processes hence that nosotros tin inquire whether nosotros are approaching a province of affairs inwards a constructive or destructive manner. If setbacks are treated equally learning experiences, they are unlikely to generate stress together with distress. If nosotros thought setbacks equally failures together with reflections on our competence, hence nosotros generate our ain stress.

One of the nearly of import steps nosotros tin accept inwards preserving together with enhancing our motivation together with campaign is to remain goal-oriented. If nosotros are fixed on a meaningful goal, we're probable to acquire energy. If we're fixed on our shortcomings (and blaming ourselves for those), we're probable to lose energy. Burned out traders work upward their emotional fuel. H5N1 primal to longevity--and successful self-coaching--is keeping the meaningful goals e'er inwards front end of us, hence that nosotros are e'er renewing our emotional fuel.
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Info!! Changing Minds As Well As Markets: Character Command Inwards Trading

Suppose a mortal has demonstrated trading skills: an might to read markets based upon lengthy exposure to alive markets too internalization of trading patterns. What would drive such a trader to give-up the ghost into a prolonged slump?

One possibility is changing markets. If the patterns familiar to the trader change, thence at that topographic point is a involve for a fresh learning curve. I run into this really oft when markets alter their volatility, every bit has happened from the offset quarter of the twelvemonth to the minute quarter (and every bit has been happening from 24-hour interval to 24-hour interval at times). Inability to accommodate to changes inwards the market's vogue to follow through on moves creates losses (or missed opportunities), which thence creates frustration, which thence leads to farther trading problems.

A minute possibility is that changes inwards the trader's heed patch effect inwards variability inwards the sensitivity to marketplace patterns. Though those patterns may survive stable, the trader's frame of heed may vary from warning to bored to fatigued; mood may vary from positive to neutral to negative. Variation inwards concentration would Pb to variation inwards might to selection upward patterns. Divided attending would create interference inwards one's experience for markets.

The challenge for traders inwards slumps is to differentiate betwixt these 2 sources of trading problems. My feel is that likewise footling idea goes into both alternatives: traders don't systematically await at markets over fourth dimension too their changes, too they don't accept fourth dimension each 24-hour interval to standardize their mental too physical states. If traders were manufacturers, they would take away maintain wretched lineament control.

Of course, all this solely makes feel for traders who take away maintain developed kernel skills too the might to read patterns inwards markets. The bulk of trading problems, I believe, come upward neither from changing markets nor changing minds, but the lack of fourth dimension too endeavor devoted to systematic marketplace learning. It's when those skills *have* developed that lineament command becomes every bit of import for traders every bit for car makers too restaurants. I'm non certain most traders know their lineament or know how to better it. That's something I'm thinking a lot nearly every bit I trek the Pacific Northwest this week.

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Info!! Every Work Is An Outdated Solution

One of the offset lessons I learned equally a psychologist is that our problems mostly correspond coping efforts that get got long since lost their usefulness together with that directly convey unwanted consequences.  This is a powerful concept, together with ane that is non good appreciated past times traders.

A classic instance would last a mortal who is emotionally or physically abused equally a child.  Good coping for the kid is to travel past times along rubber distance from others together with avoid getting hurt.  Good coping powerfulness too last blaming oneself for the abuse to remain inward the expert graces of parents who are the assist providers.  Later inward life, keeping a distance from others together with blaming oneself for negative outcomes acquire problems, interfering amongst relationships together with happiness.  But problems are non the problem; the employment is overlearned coping that no longer fits your life situation.

This is why psychological modify is non together with hence uncomplicated equally calling upon motivation, positive thinking, mindfulness, etc. etc. inward ridding ourselves of employment patterns.  If our problems correspond coping efforts, we'll alone modify if nosotros notice superior, substitute coping strategies.  The mortal who was wound inward childhood needs to notice new, constructive ways of finding security together with closeness.  Until in that location is novel coping, in that location volition last no powerfulness or willingness to percentage ways amongst what worked inward the past.

A instant affair I learned early on inward my career equally a shrink was that well-nigh people don't get got lots of problems, though it frequently feels that way.  Rather, they get got a unmarried number that impacts multiple areas of life.  If they tin dismiss resolve that issue, the resolution brings positive gains at work, inward relationships, inward mood, etc.  

If you lot get got a recurring employment inward your trading, it may demo upwards inward unlike ways inward unlike marketplace weather condition together with it may look equally though you lot get got dozens of problems. Consider the possibility that in that location is ane principal issue--and that number is non a problem, but an test at coping that is non working for you lot inward trading situations.

For instance, pulling away from situations that are stressful is a slap-up agency to avoid vulnerability.  I instinctively take from situations that I notice to last dysfunctional.  If I can't physically leave, I take emotionally together with acquire distant.  I tin dismiss experience that wall travel past times up.  In many situations, putting upwards the wall has worked really well.  At several situations inward my career, when business office politics became hugely dysfunctional, I kept the wall upwards for an extended fourth dimension together with was able to brand the well-nigh of my job.  I engaged people inward a cordial manner, but otherwise had zilch to produce amongst them.

In markets, however, you lot can't only line dorsum when things hitting the fan.  It's ane affair to line away from uncooperative people; about other affair to bail from an uncooperative market!  Using the coping from the project province of affairs leads to all sorts of problems inward markets, including exiting markets at the incorrect fourth dimension together with failing to travel inward markets when there's opportunity.  In my ain trading, I had to acquire novel ways of coping amongst stressful markets earlier I could consistently human activeness upon my best-laid plans.  Clearly defining my downside inward advance together with mentally rehearsing the loss scenario together with hence that I knew I could alive amongst a bad result enabled me to tolerate stress without resorting to the old, avoidant ways.

So hither are a few expert questions for self-assessment:

1)  What are the problems that recur inward your trading?
2)  What negative outcomes are your problems trying to avoid?
3)  In your best trading, how produce you lot care to notice amend ways of dealing amongst those potential negative outcomes?
4)  How tin dismiss you lot rehearse those amend ways of coping inward real-time trading situations together with hence that you lot won't autumn into old, outdated coping modes?

Every employment is a failed solution to a challenging situation.  Once nosotros select problems equally coping efforts, nosotros opened upwards ourselves to a search for new, amend solutions.  We never actually acquire rid of our problems.  We only substitute novel coping efforts that lay the groundwork for tomorrow's problems.

Further Reading:  Madness together with Trading
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Info!! Understanding, Prediction, As Well As What Makes Discretionary Traders Successful

This postal service was written from Glacier National Park inwards Montana.  Sometimes it takes a consummate alter of scenery to create a fresh mindset in addition to renewed focus on what is essential--in life, equally good equally inwards trading.  It's when nosotros innovate novelty into our lives that nosotros are most probable to attain novel insights.

Recently I wrote a postal service that has flora unusually rigid involvement from readers, focusing on what is most of import inwards markets.  The postal service was distinctive because it emphasized marketplace understanding, non the prediction of markets.  This is a really of import distinction for discretionary traders.

Let's tell I'm a nurture in addition to I notice my son beingness unusually quiet, talking softly and keeping to herself.  I've seen those facial expressions, tones, in addition to behaviors earlier in addition to know that they receive got typically occurred whenever he has felt wound or rejected.  As a psychologist, I likewise know that those same demeanour patterns occur inwards other people for other reasons, such equally when they are deeply reflective almost a challenge at operate or when they are deeply frustrated almost a situation.  For those other people, the menses of serenity powerfulness live on followed past times a flare-up of operate effort--or a flare-up of anger.  The serenity comes from a unlike house for my son, however, in addition to has inwards the past times led to periods of sad mood in addition to misfortunate operate performance.

With that understanding, I only give him a hug in addition to allow him know that he is special to me.  That reaching out is plenty to select him out of his shell in addition to larn him talking almost what went incorrect amongst his best friend.  With the emotional release, he begins to experience better, short-circuiting the depressed feelings in addition to helping him reengage amongst other life activities.

Being a therapist is all almost tracking the thoughts, feelings, in addition to actions of a unique human being;  understanding what is driving those; in addition to and thus using that awareness to aid create a fix of weather condition that tin Pb to increase rather than setback.  In a unlike context, that is likewise what a slap-up nurture does.  What therapists in addition to parents don't exercise is bear backtests of all similar occurrences across all people in addition to and thus generate a prediction of hereafter demeanour to figure out how to respond.  Understanding is built from the dry ground up, taking particulars in addition to making sense of them, creating possible explanations.  Prediction is a top-down process, starting amongst universal patterns in addition to applying them to item contexts.

A meteorologist seeks prediction, making purpose of complex models that rails temperature, humidity, wind, air pressure, etc.  H5N1 historian seeks understanding, looking at the motives in addition to cultural influences that Pb to political, economic, in addition to military machine decisions in addition to outcomes.  Each is an approach to knowledge:  nosotros powerfulness accurately predict the outcome of a ball game and also empathise the decisions in addition to strategies that led to the outcome.  

Successful discretionary traders I've known in addition to worked amongst receive got been distinguished past times their grade of marketplace understanding.  Successful quantitative traders I've encountered receive got excelled at analysis in addition to prediction.  Sometimes the successful discretionary trader makes purpose of predictive models equally inputs to decisions; the successful quantitative trader volition dry ground models inwards audio marketplace understanding.  At the terminate of the day, however, quants trade their predictions in addition to discretionary participants trade their understanding.  One trades universal patterns; some other trades insights specific to what is observed hither in addition to now inwards a item market.

What I realized inwards the Montana mountains is that the psychological challenges faced past times traders often leads them to seek quick (and artificial) safety inwards marketplace predictions.  Instead to staying grounded inwards what is happening hither in addition to now, equally in the representative of my response to my son, a frustrated or uncertain trader powerfulness hold back for answers inwards top-down predictions.  If a psychologist were to exercise this, he or she would choke emotionally tone-deaf, no longer tracking the pregnant of the unique private inwards the conversation.  When discretionary traders leap to a fashion of prediction, they frequently lose their experience for markets by imposing ideas that clash amongst the actual messages of "the tape".

I suggest that successful discretionary traders are successful for the same argue that people are successful inwards relationships:  they are able to stand upwards apart from their ain emotional responses in addition to habit patterns thus that they tin appreciate in addition to empathise the thoughts, feelings, in addition to actions of others.  When nosotros rails who is inwards the market, what they are doing, in addition to the cost levels at which they are acting, nosotros assemble the raw materials for agreement marketplace activity.  It is hard to genuinely empathise what somebody is maxim if we're busy plumbing equipment them into a model in addition to trying to predict what they'll do.  The same is truthful for the trading of markets:  nosotros neglect when nosotros choke thus eager to anticipate outcomes that nosotros halt listening to the actual messages of markets.  Quantitative data tin attention the agreement of a discretionary trader; it tin never substitute for it.

Further Reading:  Trading Emotionally, With Intelligence
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Info!! An Effective Technique For Preventing Frustration Too Its Effects On Trading

The offset shipping service inward this series dealt with stilling the negative thoughts that are triggered past times trading-related frustrations. The minute post outlined 3 steps for breaking patterns of frustration every bit they're occurring. In this lastly shipping service inward the series, I volition describe my personal favorite alongside the strategies for dealing with frustration, ane that I work extensively myself also every bit with traders I coach. The appeal of this methodology is that it is preventive: it is designed to caput off frustration before it occurs.

To sympathize the method, let's select a simple, practical example. Suppose you lot honour traffic jams to live specially frustrating. You ofttimes lose your cool during periods of traffic delay, ruining your mood for the remaining forenoon or afternoon. How could you lot preclude this from occurring?

Telling yourself to non overreact doesn't work: emotions are amazingly refractory to such willpower efforts. Interestingly, the best approach is to actively *plan* for the rattling frustration you lot hate. If, say, you lot *knew* you lot were going to live delayed inward your commute due to a snowstorm, you lot could make inward advance. You mightiness select extra music, snacks for the car, or an audiobook for listening. You mightiness programme out conference calls you lot tin hand the sack brand from the route spell you're stuck inward traffic. Once you lot are genuinely sitting inward the traffic, you lot honour that it's non thence frustrating: you lot are prepared--and that takes the emotion out of the event.

Let's select a footstep dorsum together with attempt the causes of frustration. We boot the bucket frustrated when nosotros conduct keep a goal or work inward heed together with when this objective is hindered past times forces beyond our control. Thus, nosotros mightiness live frustrated past times an airline delay when we're inward a hurry to a occupation organisation meeting, or nosotros mightiness live frustrated when we're looking forwards to a proficient night's sleep, but are kept awake past times dissonance exterior our window.

Frustration hits us when nosotros experience these impediments every bit *threats*. The airline delay mightiness live a mere annoyance if we're non inward a rush to an of import event. If, say, that number were a crucial chore interview, nosotros could live frustrated indeed.

When a trader emotionally accepts losing every bit role of the business, loss is non thence threatening. With proper coin management, it tin hand the sack live contained together with take non pose to a greater extent than than an annoyance. But if a trader *needs* to brand money--perhaps because of perfectionism, or perchance because of dire fiscal circumstance--then normal loss mightiness live experienced every bit odd frustration. It's the overriding *need* to brand coin that sets the trader upwards for shrewd frustration.

As inward the inward a higher house lawsuit of anticipating the traffic delay, nosotros tin hand the sack anticipate losses together with make accordingly. For example, let's state I'm preparing myself for a potential reversion to a hateful trading cost every bit we're trading close the bottom of a multi-day range. I know that, every bit nosotros approach the lower destination of that range, that we'll either larn the anticipated reversion, or we'll consider a downside breakout. Either way, at that spot volition live a proficient merchandise inward the offing.

Before the marketplace opens, I spot myself comfortably together with breathe deeply, slowly, together with rhythmically, focusing my attending on relaxing music playing through headphones. Once I'm calm together with focused, I walk myself through the anticipated trade, imagining inward item how the marketplace trades close the bottom of its hit together with bounces higher, how I hold off for the offset pullback from that bounce, together with thence how I larn inward with my long spot to capitalize on the furnish to the average trading cost inside that range. It's every bit if I'm watching a movie, visualizing vividly myself executing the merchandise idea.

Then, however, I include the frustrating number inward the visualization: I vividly ikon the marketplace reversing together with trading weaker, with majority at nowadays hitting the marketplace bid. I imagine myself feeling frustrated that my merchandise hasn't followed through, together with I visualize myself stopping the merchandise out in ane lawsuit nosotros merchandise below the betoken at which the above-mentioned bounce began. Then, I farther visualize waiting for a fresh downthrust (confirming the weakness) together with straight off entering the marketplace on the curt side on the offset bounce, flipping my spot to capitalize on the downside breakout. That is my training for the frustration, simply similar the training of the driver who knows he'll live stuck inward traffic inward a snowstorm. Instead of viewing it every bit threat, I'm mentally rehearsing it every bit opportunity. The stopped out "reversion" merchandise tells me that we're non going to remain rangebound. Instead of focusing on the loss, I stress the data gathered from the loss together with make inward advance to flip my position.

As with the before exercises, this practise requires repetition together with the willingness to select fourth dimension each forenoon to make for frustrations with brilliant scenarios. Readers of becoming their ain trading coaches. My upcoming majority volition describe this inward considerable detail. The fundamental is embracing frustration past times anticipating it together with turning it into opportunity. That removes the threat from emotional triggers, enhancing a trader's self-control.

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Info!! Managing Your Unloose Energy For Superlative Productivity

Shout out to Terry together with WindoTrader for the ship on effectively managing your TEAM (Time, Energy, And Money).  The ship points to a employment I've noticed inwards many contexts:  traders who are together with then busy next together with trading markets that they neglect to create create the personal resources essential to their longer-term success.

This is peculiarly problematic inwards the representative of non effectively managing one's liberate energy level.   There are several forms of positive sense that get upward productivity together with creativity:  happiness, life satisfaction, energy, together with affection.  When nosotros deplete our energy, it is to a greater extent than hard to sustain the activities that generate the other forms of positivity.  For that reason, a depression liberate energy bird most ofttimes manifests itself inwards depression positive experience, creating a downward spiral--decreasing energy, decreasing positivity--that impacts mood together with behavior, together with ultimately productivity together with audio decision-making.  

How ofttimes create traders neglect to follow their plans together with deed on their ideas only because they are at low levels of willpower due to depleted energy?

Of course of written report nosotros tin reach the sack lose liberate energy due to lack of sleep, overwork, lack of exercise, together with miserable eating.  H5N1 to a greater extent than subtle but important loss of liberate energy occurs when nosotros neglect to tap into our essence strengths together with values during our daily activities.  Activities that nosotros sense equally *meaningful* reach us energy; activities that bang us equally meaningless sap our strength.  Digging a ditch for no role whatsoever would hold out physically together with emotionally draining.  If, however, nosotros knew that earthworks the ditch inwards a sure enough sum of fourth dimension would Pb to a real large payday, nosotros would notice the motivation to larn the travel done on time.

Similarly, when nosotros play to our strengths, nosotros sense activities equally affirming.  The exercise of signature skills is intrinsically rewarding:  nosotros notice enhancement inwards doing what nosotros create best.  When nosotros larn away from our strengths, endeavour becomes exactly that:  project amongst picayune psychological reward.  I volition larn upward at four inwards the morning time to analyze a information laid upward that helps me meliorate sympathise the market; the intellectual curiosity is energizing.  If I had to larn upward at that fourth dimension to create household chores, I would notice it hard indeed to remain awake.

An of import implication of this perspective is that your liberate energy bird inwards researching together with trading markets is a reflection of the grade to which you lot are meaningfully engaged together with challenged.  If you lot attempt out to procedure information inwards a agency that is non your strength--forcing yourself to read, for example, when you lot procedure textile much meliorate yesteryear hearing together with discussing it--the endeavour volition hold out taxing rather than energizing.  That, inwards turn, tin reach the sack Pb to those willpower-based lapses inwards concentration together with other seeming problems of "discipline".  The number is non discipline, per se; it's i of leveraging essence skills, interests, together with values.

A spell ago, I wrote nearly the essence components of a trading process.  At a science level, a trading procedure aligns us amongst best practices:  what nosotros create good inwards markets.  At a purely psychological level, a trading procedure aligns us amongst our strengths together with values.  In that respect, procedure becomes our liberate energy regulator:  it allows us to renew our liberate energy reserves yesteryear channeling our efforts toward ends that are meaningful together with intrinsically rewarding.  H5N1 adept procedure does to a greater extent than than create create energy:  it digs novel wells together with increases our reserves.

Further Reading:  The Laws of Psychological Energy
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