March 27 - Loss Acceptance Reqd

I've been able to think slower and not cave too impulses, but the underlying overthinking remains.

The source of that angst, overthinking, double guessing, I believe, is due to loss acceptance.

I believe this is it because the times when I've truly accepted the loss AND not trying to make money, PA becomes incredibly clear and trade execution becomes very simple. What's going to happen is going to happen. I typically will set stop loss levels and profit levels but if I haven't truly accepted the loss, I'm constantly agonizing about how the facts may or may not have changed and therefore should I exit short of those levels - either to take a smaller loss or guarantee profit.

When I have truly accepted the loss two very beneficial and compounding things happen. 1. I tend to enter very close to my stop loss. And, 2. because I've entered close to my SL and suffering a deep drawdown, I'm able to let the position run to the profit level.

Entry is easier because I'm okay with losing. And as long as I'm okay losing, then it's not 'scary' to enter on a red candle for the option. As I write this out why would I ever enter while the candle is green! Or if the analysis favors a move, by accepting the loss I can wait for the premium support fake breakdown.

When I have a poor entry, because of the 'pain' of the drawdown, I'm typically very quick to relieve that pain by taking profit early. Fully accepting the loss allows for the better entry, if the trades wrong I lose, if the trades right, I'm typically not in a drawdown, so there's no 'pain' to be relieved -- I let the position run.

The flip side ends up materializing. If I don't experience a drawdown, the opposite of pain surfaces... greed. A desire to hope it goes further. But, that is not scalable nor does letting 1 trade go longer actually move the needle anyway. It only sets the precedent for poor execution.

So, loss acceptance, with a concrete exit plan - gain or loss. Much easier to accept the loss with 1. a real setup and patience for a CASPAR entry and 2. proper size.

Being slow. Being comfortable 'missing' the trade. Having a cohesive narrative behind a setup and then waiting for CasPar. That analysis and foresight, allows for loss acceptance. Which translates to small losses and small or big gains. Outcome doesn't matter with the right setup and size.

Loss acceptance is the secret. The secret to loss acceptance is slow, thoughtful analysis plus appropriate size. It also requires a compounding mindset. It's not about converting this trade. It's about executing consistently to stack wins in the long term.

There's always another trade. No need to chase.

Cohesive setup and CasPar entry.

Plan the exits. Accept the loss.

Probabilities are high, losses will happen.

Next trade.

Why is accepting the loss so hard?

I've lost so much money I don't want to lose more. Which ironically is keeping me from seeing PA clearly.

I've lost so much and potentially give the same weight to a small trade loss as I do the pain of losing family. A loss on 250 of 1000 trades - let alone just 1 trade - does not come close to the real loss I've endured. These losses are simply part of the game, not an outcome to be feared / avoided / painful.

Even when I fully accept the loss and am thinking clearly, I will still lose.

Can I accept that? Can I accept the probabilities?

I can if I really want to accomplish my goal. The mentality is of course I'm going to lose money. My job is to minimize the loss when the coin flips against me. Then exit at the next level when it flips in my favor. It may go further but even if it does it's only 1 trade.