Awareness of performance potential

 Something a bit unexpected happened lately. I've been struggling to hold onto intraday gains, and it perplexes me as to how I can run up an account after a hard-earned trading session, only to be triggered by something to proceed to do the opposite (run down the same account, even turning red). 

That's not the unexpected part really; that's more of a page out of any trader's story, even pros with many years of experience. The unexpected part was realizing that my typical daily run-ups far exceed that of many profitable traders (after getting a bit more of an inside scoop on some traders' journeys in retail prop trading). In other words, my performance "bar" is quite high, but I haven't been cognizant enough of my own performance capability relative to typical good traders to know that my biggest job is probably to just to appreciate what I'm capable of and holding onto whatever the market gives me in focused sessions. 

It reminds me of the perfect student who sometimes gets rattled with that first B-. Very similar to what I see in myself in the markets. One miss, one bad trade (which is actually a normal occurrence that requires a clean acceptance of a stop loss before moving on), or one fat-finger trade (also not too atypical), and I get rattled, as if it indicates the start of the end to my success. This is a latent danger of a high winning percentage strategy I suppose, another comforting but not always healthy characteristic of my trading system. 

I've identified two categories that, if aligned, can lead to really good things: skill and confidence. The best combination is of course high skill and high confidence, which ironically leads to weathering losses better since you have conviction in your own abilities (which are valid) to come back and thrive later. It's the skilled, unconfident traders who are susceptible to larger drawdowns since they see good results for a while, but don't have the wherewithal to step away and come back in a more optimal time (this sounds like me). The unskilled, unconfident trader never even takes a trade, so they're fairly protected! The worst combination is unskilled and confident. A disaster in the making.

Confidence itself is probably a complex topic that deserves another blog post. It probably originates from a combination of life history, a hidden or tangible support system, self-talk, etc. Maybe it's worth diving into some psychological papers on the origins of confidence (or the lack thereof) to better map out how to overcome my recent observations of my own disconnect.