Hacking patience

In a trader's journey and never-ending development, one encounters what feels like a million and one things to learn, unlearn, and sometimes invent as a handy way to get ahead. Sometimes "getting ahead" actually means stepping backward, sometimes it means stepping on the gas, and at other times it means patiently--and often painfully--waiting. You can probably relate to the idea of being creative in the way you approach the markets, most notably formulating your own indicators as to when and how to take action (trades). But what about inaction?

Inaction, or waiting, is one of the hardest things to do for humans, as it goes directly against our need to do something. After all, kinetic energy drives the visible world around us, right? Well not if you consider potential energy, which stores future kinetic energy. Think of waiting as the storage of potential energy, a battery recharging in a sense. Many underlying things can take place when waiting, like the formation of a base for the next big runner or the formation of a topping pattern before a big fall. Waiting can also help see the forest from the trees, or help bring you in sync with market patterns. 

Well now that you're somewhat convinced that waiting can be a good thing, how do you actually make the process any easier while the world around you screams "do something!"?? One thing I have noticed is that if you project a vision for what the future may hold (even if it's just 10 min into the future), you naturally become more patient because you are actively monitoring things as your vision plays out. This is actually an active process, as you may make adjustments as needed as things pan out, as opposed to facing a completely open-ended future where you have little expectation of where things are headed. Let's also be clear about how a vision differs from a prediction. A vision forms a picture of where things could be headed (embedded with clauses), whereas a sheer prediction is more of a specific bet of where things will be headed. A vision involves envisioning a scenario embedded with conditions and dependencies, upon which you will take action when certain conditions are met. 

This is what you might call "actively waiting", something far from passively waiting. For example, Warren Buffet and Charlie Munger choose to read volumes of material while they actively sit on long-term investments, which helps form an understanding of the macro picture (and steers the course of future investments/actions). In the case of shorter term traders, spending time this way may not be practical, but actively projecting scenarios as price action evolves can be equally productive in making the most of time that would otherwise be perceived as a period of painful, unproductive inaction.

"The waiting is the hardest part"

-Tom Petty