The Trading Environment - Chaos and Distractions

The trading environment or the physical world of trading is chaotic. As much as a trader would want to, he cannot trade in a vacuum. It is simply an impossibility. The information he needs to be able to trade comes packaged with distractions and noise. There is no escape from all these during the trading day. He must live and work with them. Though the environment may be difficult, the trader's focus and concentration must be centered, laser-like, on necessary information which he must extract, filter and separate from the surrounding chaos, distractions and noise.

In addition, he must deal with the news and commentaries by recognized and/or self-proclaimed trading authorities. They are on television. On the internet. And what may be happening inside and outside the country may be pertinent to his trading activity.

Literally, the trader is bombarded by things relevant and irrelevant. And all these come at the very start of the trading day. And continue to come throughout the trading day. And even after the close of the trading day. The sum of all these constitutes the physical and external trading environment.

Somehow the trader must cope with this environment. Certain traders can deal with all of the above. Others with only some of the above. Still others with none of the above. What's a trader to do? Different traders have developed different approaches to this environment. Perhaps the more apt statement is each trader has developed his own unique way of coping.

Certain traders are able to duke it out with the environment during the trading day. Amidst the chaos, they are able to navigate the markets and execute their trades. Others carefully watch developments and pick their spots to trade. These traders are the master swordsmen of trading.

Other traders prefer to make their analysis of developments after the close of trading. They prefer to do their analysis without hurry. They prefer to have the benefit of all relevant information in front of them to be able to sort them with care. And plan for the next day of trading battle. These are the master planners of trading.

Though they differ in approaches, they all share a common thread. They all trade from their respective comfort zones. Comfort zones differ with each individual trader. Each trader must find the comfort zone most suitable for him in terms of his personality, personal style and psychological profile. The trader, before starting to trade, must have his comfort zone well defined and established and his own particular responses to the various stimuli of the trading environment thought out in advance.

His comfort zone is the place in the trader's mind where he finds the balance between the chaos and distractions of the external trading environment and the internal confidence he has in himself that he will be able to trade and take action without undue anxiety that might lead him to trading mistakes. His comfort zone is mainly anchored on his trading plan that will show him the way through all the chaos, distractions and noise of the trading environment.