# Alex's Trading Psychology Reflections

## The Core Trio of Swing Trading: Patience, Discipline, Conviction

If I had to boil down what separates consistent swing traders from those constantly spinning their wheels, it comes down to three pillars: **patience**, **discipline**, and **conviction**. Without these, no system or strategy will carry you far.

**Patience** is the art of waiting—for the setup, for the confirmation, for the follow-through. Most traders burn out because they can't sit still. They confuse activity with progress, reacting to every wiggle on the chart. But the real edge in swing trading lies in knowing when *not* to trade. Patience means letting the trade come to you, not forcing entries just to feel engaged. And once you're in, it means letting the stock breathe—enduring the inevitable noise without panicking at every tick.

**Discipline** is what holds the framework together. It’s following your rules when you least feel like it. It’s honoring your stops when you want to give it “a little more room.” It’s resisting the urge to revenge trade after a loss, or to randomly size up after a win. Discipline isn’t something you practice only when things are going well. It’s a daily habit—executed regardless of mood, bias, or outside noise.

**Conviction** is the emotional backbone that supports your actions. It’s not stubbornness or blind belief. Conviction is earned through preparation and experience. It’s knowing your edge well enough to trust it, even when the trade feels uncomfortable. It’s what lets you stay in a strong name through a shakeout, or step up in size when all the conditions line up. Without conviction, you’ll hesitate on the winners and overstay your welcome in the losers.

These three work together. Patience without conviction just becomes hesitation. Discipline without patience becomes mechanical overtrading. Conviction without discipline turns into reckless aggression.

When all three align, you enter the zone. You’re not reacting—you’re executing with clarity, precision, and intent. That’s when trading becomes repeatable. That’s when real growth begins.

## Stop Obsessing Over P\&L — Trust the Process

When a new uptrend kicks off, one of the toughest shifts is learning to stop obsessing over your P\&L every time the action cools off.

It’s normal — price breathes. Pullbacks are part of healthy trends. But if you’re glued to your cushion, fearing every red bar, you’ll end up reacting instead of executing.

That’s when emotions creep in, and good trades get cut short.

Stick to the process. Trust your structure. Let your selling rules guide you — not the noise of a fluctuating P\&L.

## Superperformance Starts Early — Not at Consensus

One of the biggest differences between reactive traders and those who catch real superperformance is where they choose to engage. Most wait for the long-term confirmation — the clean trend, the obvious breakout, the consensus opinion that “this name is strong.” But by the time that happens, the easy part of the move is often gone. You’re not early anymore. You’re chasing strength that others already positioned for.

What’s worked for me is learning to trust short-term trend confirmation. Not blindly, not with oversized risk — but with awareness. When price structure starts to shift, when early volume comes in, when the character of a name changes — that’s where the edge begins. You don’t know if it will morph into a longer-term trend, and that’s the point. You engage with the possibility, not the certainty.

Sometimes it fades. Sometimes it fails. But if you’re managing risk — trimming into strength, raising stops, staying fluid — the downside is limited. And over time, the upside compounds. Because the best trades, the ones that carry, always start the same way: with a subtle shift, a short-term confirmation, and a trader who’s willing to step in before the crowd feels safe.

That’s the game. Not predicting the future — but aligning early with what’s starting to work, and giving it room to become something more.

## Secure Your Gains — Manage Open Heat

One of the most overlooked metrics in trading is your Open Heat — the unrealized profit you’re exposed to if every stop-loss gets hit.

It’s easy to ignore when things are going well. But if you don’t track it, you’ll give back chunks of your equity curve without even realizing where the damage is coming from.

The pros? They manage that heat actively — not reactively.

That means:\
Raising stops as trades progress.\
Trimming into strength when names hit logical stretch zones (2x ATR from the 21dma, 5x from the 50dma, etc.).\
Freeing up mental bandwidth so they’re not hostage to every tick.

You don’t need to predict tops.\
You just need to stop assuming your unrealized gains are safe.

Managing Open Heat isn’t about fear. It’s about staying in control of your equity curve before the market decides for you.

Secure it while it’s yours.

## Ride the Trend — Don’t Guess the End

One of the biggest opportunity killers I see — and honestly one of the fastest ways traders destroy wealth — is trying to guess the end of a trend.

Whether it’s short-term or long-term, that urge to call the top or bottom way too early comes from a place of wanting to be right instead of staying aligned with strength. And more often than not, it leads to cutting winners short, stepping in front of momentum, or forcing trades that aren’t there.

The truth is, strong trends usually run longer and further than most expect. Your job isn’t to outsmart the market — it’s to ride the wave while it’s moving in your favor, and manage risk when the structure starts to break down.

Stick with what’s working. Let price tell the story — not your opinion.

## Defense Wins the Game

One thing that really clicks with experience is how keeping drawdowns small becomes the game-changer.

Early on, everyone’s focused on finding the next big winner — but over time, you realize it’s not about how much you can make when things are good... it’s about how little you lose when things aren’t.

You start to trust that when the market comes back in your favor, you don’t need to force it. A couple of solid days — 1, 2, maybe 3 — and you’re not just back to even, you’re pushing new highs.

That’s when you truly get the value of good defense. Not being stubborn. Not trying to prove anything when conditions aren’t right. Just staying light, protecting capital, and keeping your mental game intact.

Because once you master that, you stop digging holes — and making progress becomes a lot easier.

Stay patient. Stay sharp. The offense is easy when you’re not spending all your energy climbing out of a deep drawdown.

## Don’t Chase Late — Play the Long Game

I know some of you are feeling like you missed the boat on this move — trust me, I get it. But this isn’t the spot to start chasing and loading up just to "be in." The risk/reward here isn’t what it was a few days ago.

What you need to remember is that if this is truly the start of a bigger trend — and with long-term breadth finally coming off those deep, multi-year oversold levels, it’s looking that way — then this is just the beginning.

Big moves don’t happen in a straight line. There will be pullbacks, there will be consolidations — and that’s where the real opportunities come. Your job isn’t to catch every point; it’s to position smartly when the odds are in your favor.

So stay patient. Focus on where you want to buy, not if you should be buying right now. There’s plenty of game left to play if this is the real deal.

Stay sharp.

## Respect the Downside — Survival Is a Position

In this game, ugly can get uglier. Never assume it can’t go lower, faster, and harder than you expect.

That’s not fear — that’s respect.

Preserve capital. Protect your peace, because survival is a position.

## Reset with Clarity — Learn from the Pain

To those caught on the wrong side of this market tonight, I feel for you. We’ve all been there.

The best thing you can do in moments like this is simple: sell everything, go to cash. It clears your mind and helps you think straight again. Then comes the real work: understanding how it happened so that it doesn't happen again.

That’s how I first learned risk management - not from a book, but from a massive loss, averaging down on some Canadian micro-cap mining stock. It hurt.

But pain builds habits. Let it teach you. You’re not alone.

## Know What You’re Looking For — Then Act

It’s not about calling the bottom — or the top. The market will do what it wants. What matters is having a clear set of rules to engage.

If conditions match your criteria and setups are showing traction, increase exposure and press your edge. If not, wait — or reduce risk.

You don’t need to predict the future. You just need to know what you’re looking for, and act when it shows up.

Keep it simple. Focus on execution, not prediction.

## Adaptability Over Certainty

Many traders search for patterns, hoping to predict turning points with certainty. But markets are dynamic, not static.

Historical analogs can provide context, but they don’t dictate the future. Each cycle is shaped by unique economic forces, liquidity conditions, and sentiment shifts.

The best approach? Adaptability. Instead of fixating on whether a bottom is in, focus on the evolving landscape—price action, leadership, and macro drivers.

Conviction is valuable, but certainty is an illusion. Markets reward those who can adjust, not those who assume.

## Bottom-Fishing vs. Confirmation

There’s something about catching the exact bottom that feels damn good. It’s like a badge of honor, proof that you saw the turn before anyone else. But you know what happens most of the time? You get in too early, thinking, this is it, only to watch price roll over and smack you in the face. It’s classic FOMO. You see a bounce, you don’t want to miss the move, and boom—you’re caught in the chop. The problem? In a downtrend, failed bounces are just part of the game. The market isn’t reversing just because you want it to. So how do you stay out of the trap?

* Accept that you don’t need to be first. The market isn’t handing out trophies for catching bottoms.
* Let price prove itself. kma's reclaim, MCSI turning up, Higher lows, volume coming in, real strength—wait for it.
* Remind yourself: Missing the first 2% of a real move is better than getting wrecked trying to guess the turn.

**Patience pays. Let the market show its hand, then play your game—not the other way around.**

## Use Quiet Markets to Build Edge

**Not trading when the market is bad is key as a longer-term swing or position trader. But what could be done to stay engaged and get better?**

* Go out to do something else, recharge mental capital.
* Read a book for education and acquire new knowledge.
* Go back and analyze your prior trades, do some deep PTA.
* Go back in history and find the best performing stocks of each year/window of opportunity and find the best entries, the characteristic they had before their run...etc. Build your conviction, your edge.
* Perfect your market timing tools to keep you out/in the market.

But doing no trading is important. Use that time to better use than being chopped or get bored. When market is good and action is high, it's not the time to perfect our system. Right now is the perfect time.

## Strike When It Matters — Not All the Time

Trading isn’t about constant action—it’s about striking when it matters. No setup works in every environment, and trying to force trades in choppy conditions only leads to frustration. The best traders don’t just know what to trade—they know when to trade. They wait for strength, momentum, and follow-through before deploying risk.

And here’s the key—the best windows often come when it feels the hardest to buy. When breadth is oversold, fear is elevated, and weak hands are shaken out, that’s when the market is primed for real opportunity. But if you’re overtrading in noise, you won’t have the capital or confidence to take advantage when it finally counts.

Patience isn’t passive—it’s a weapon. The edge is in trading when conditions align, not when boredom or emotion pushes you into action.

## Patience & Resiliency in Swing/Position Trading

If you’re coming from a day trading background, you’re used to immediate feedback—you place trades, get in and out within minutes or hours, and you know right away whether you're right or wrong. Performance feels like it's in your hands.

But when you step into swing or position trading, that instant feedback loop is gone. Instead, you’re sitting through market noise, pullbacks, and inevitable drawdowns. And here’s the hard part—a drawdown in swing trading isn’t necessarily a reflection of your skill, but rather a normal part of letting positions work.

Most new traders struggle with this because they think every dip against their position is a mistake. In reality, it’s just part of the process. If you’re in the right stocks, those pullbacks are just setups for the next leg higher—but you have to sit through them.

Even Kristjan Kullamägi, one of the best momentum traders out there, has said he’s in drawdown around 80-90% of the time. And his biggest drawdown? 50% in 2014. Even now, he tries to keep them at 15-20%, and they still happen a few times a year. That’s just the game.

So, if you’re transitioning from day trading to swing/position trading, the biggest skill you need to develop isn’t a new strategy—it’s the ability to sit tight and let the process play out. The winners will prove themselves over weeks and months, not minutes and hours.

Patience isn’t just a virtue here—it’s a necessity.

## Study the Missed Moves — Build Your Playbook

**FOMO hits hardest when you’re watching a move you didn’t catch.** But let’s be real — chasing it now won’t fix anything. It usually just makes things worse. Instead of beating yourself up or trying to force a late entry, go back and study the move.&#x20;

**Ask yourself:**

* How was the market setting up?
* What were the leaders doing?
* Where could I have engaged with risk defined?

This isn’t about regret — it’s about building a process. Every cycle gives you new data. Use it. Create rules that would’ve actually got you in earlier. Then bake that into your system.&#x20;

I can help with insights along the way, but the heavy lifting — that honest self-review — has to come from you. That’s how you stop feeling left out, and start being ready next time.

## Trade Like a Surfer

**Trading really isn’t that different from surfing.**&#x20;

At first, you're out there waiting — watching — not chasing every ripple. You want the **right wave**, the big one, so you stay patient, scanning the horizon.&#x20;

But here’s the thing — **not every wave is worth riding**. Some lose shape, some break too early. Same in trading. You have to recognize quickly when it’s not the one, and reset. No ego — just back into position, ready for the next real shot.

When it starts to build, you go — you **paddle hard**, just like a trader pressing the gas, building exposure, fighting to get in early but with control.&#x20;

Once you’ve got enough speed — enough cushion — you **stand up**. That’s where it gets smoother. You’ve de-risked, you’re in sync with the move, and now it’s just about **riding it clean**.&#x20;

Eventually, that wave starts to fade. You feel the momentum slow down. Time to step **off the board**, protect the gains, and get back into position… waiting for the next setup to come.&#x20;

**Same rhythm. Same discipline. Same payoff.**

## Don’t Wait for Comfort — Act on Discomfort

One of the more subtle psychological traps in a strong market is how it tricks us into passivity. While price grinds higher, most traders sit on the sidelines thinking, “I’ll jump in on the next pullback.” It feels brilliant, patient, even. But when that pullback finally shows up, it rarely feels like the opportunity we imagined. Instead, it feels threatening. It shakes confidence. The same traders who were waiting suddenly hesitated, framing the dip not as a healthy reset, but as the start of something bigger, something more dangerous.

This is where experience separates those with a plan from those following their emotions. A strong trend will never offer perfect comfort. It either feels too extended or too shaky. But if you’ve done the work — if you trust your system, short-term confirmation signals, risk management — then that discomfort becomes a signal, not a warning.

The best trades often don’t feel great when you take them. They feel uncertain, premature, and uneasy. But over time, you learn that engaging during controlled pullbacks is where the real edge is. Not when it’s obvious. Not when it’s already bounced. But when doubt is in the air, you still execute because you’ve seen this play out before.

Most will keep waiting, and some will keep hesitating. The ones who show up with a clear plan will be in position when the next leg starts.

## **Trust the Structure — Don’t Fear the Pullback**

Pick one support structure — just one — and build all your rules around it. If you start using 3–4 levels, you’ll find a reason to justify any trade. For me, it’s the **21dma-structure** — that zone is my anchor for pullbacks and trend continuation.

And here’s the key shift: when you buy near support, stop treating it like a cliff. It’s not a “last line” before disaster — it’s where stocks digest, reset, and build new ranges *after* extension. That mindset makes it easier to sit tight, let price chop, and trust the structure you picked.

## Mindset During Pullbacks

Pullbacks aren’t threats — they’re opportunities in disguise.

When you’re aligned with the trend, positioned with structure, and reading the tape objectively, a pullback isn’t something to fear. It’s where setups reset, current leaders take a breather, and new leaders often emerge. It’s where the next leg higher quietly builds beneath the surface.

Yeah, it feels uncomfortable — but discomfort isn’t danger. The odds rarely favor a new bear market kicking off right in the middle of trend strength and improving internals.

Keep your mindset clean. Don’t let every dip shake your conviction. Stay patient, stay prepared — pullbacks often reward the traders who don’t flinch.

## Why Doing Less Made Me a Better Trader

One of the biggest shifts in my trading journey was realizing that doing less actually moved me forward.

When you come from a 9–5 world, you're wired to believe that being busy = being productive. You're rewarded for effort, presence, and filling your day with tasks. The more you do, the more it feels like progress.

But trading isn’t like that.

That mindset — trying to stay active and always involved in something — is what hurts most traders early on. I used to chase setups all day, thinking I had to be constantly engaged to move forward. More alerts, more tickers, more action. But the only thing that really grew was my frustration and drawdowns.

Over time, I realized that most of my real progress came from restraint. From doing less, but doing it with focus and intent. Some of my best stretches came from trading just a few names, over and over — the ones I understood deeply. I sized up only when conditions were aligned: the setup, the structure, the market, and my state of mind.

Doing less isn’t lazy. It’s strategic. It’s letting the market come to you, not forcing your will on it. That’s what creates consistency and peace of mind.

## **The Power of Persistent Trends**

Markets have this humbling way of staying "irrational" far longer than our logical minds expect. What feels overbought can steamroll much higher in a genuine momentum phase.

I've learned to respect that **overbought in a strong trend just means "expensive"** - not necessarily "ready to reverse." The market can climb walls of worry for months while everyone calls the top. Sentiment getting frothy? Sometimes that's fuel, not a warning.

The hardest lesson: **strong trends make believers out of skeptics**, not victims out of bulls. When you see sustained moves with persistent strength, the market is often telling you something fundamental has shifted. Fighting that with "it can't go higher" is expensive.

Better to **ride the trend until it clearly breaks** than to fight it based on traditional overbought feelings. Markets trend longer and stronger than most expect - especially when liquidity is abundant and institutional flows are aligned.

**When in doubt, follow the price action, not the crowd's discomfort.** The market's capacity to extend beyond everyone's expectations is one of its most reliable features.

Here’s a tighter, refined version in your mentor-style tone:

## **One of the biggest differences I see between top traders and those still struggling?**

It’s not the setup. It’s not the tools.\
**It’s the self-improvement feedback loop.**

**Every single market cycle, I take time to break things down:**\
— What did I do well?\
— What could I have done better?

From there, I create a new rule, refine a mental model, or tweak a part of my system—based on real experience, not theory. And it all goes on paper, pinned right by my screen where I see it every day.

**At the end of the next cycle, I reassess:**\
Did I follow through?\
Did it fix the issue or make a difference?

I’ve been doing this for nearly 10 years. And those small 1% improvements each cycle? They compound like crazy. As the saying goes—compounding is the 8th wonder of the world.

**So ask yourself:**\
How do you expect to become a top trader if you’re not improving with every cycle?

That’s the real edge.

## The Market Pays the Patient

One of the most underrated skills in swing trading—and the hardest to truly develop—**is patience**.

Not just waiting a few hours or a day… I’m talking about the kind of patience that lets you sit on your hands for a week while nothing sets up. Or holding a position through normal pullbacks without second-guessing yourself every 15 minutes.

The truth is, most of us (myself included) grew up in a world of instant gratification. One-click orders, fast dopamine hits, constant stimulation. So it’s no surprise that when we step into markets that reward waiting, we struggle.

**But swing trading isn’t about speed. It’s about timing.**

You get paid for the waiting, not the action. The big moves don’t happen because you check every candle. They happen because you aligned yourself with strength, appropriately sized, and let the trade breathe.

If you find yourself always clicking around, forcing trades, or bailing too early… It’s probably not a strategy issue. It’s a patience issue.

Train it like a muscle. Respect it like a rule. Build your system around it.

Because in the end, the patient trader sees what the impulsive trader never will.

## Let Price Action, Not Predictions, Guide You

I’ve lost way more money over the years trying to *anticipate* a pullback, a correction, or some fancy sector rotation… than I ever did just sitting tight with solid positions.

Truth is, the market doesn’t pay you for being clever — it pays you for being positioned right and having the guts to hold when it’s working. Most of my worst trades weren’t actual losses — they were good positions I sold too soon trying to get cute.

Sit tight. Let them work. Let the market prove you wrong *before* you act.

## **Why Position Sizing Should Be Based on Risk, Not Fixed Amounts**

Many traders default to using a fixed dollar amount per trade, but that approach ignores the reality that not all setups carry the same risk or reward potential. Position sizing should always start with a percentage of your account you are willing to risk if the trade fails. From there, let the distance to your stop and the quality of the setup determine the actual size.

The best risk-to-reward opportunities deserve slightly larger allocations, while marginal setups should be sized smaller or passed altogether. This way, a single trade cannot damage your capital base, and your account naturally leans into its strongest edges. Over time, it’s not the number of wins that compounds, but the consistency of managing risk relative to your account.

## **Start With the Market, Not Just the Setups**

Most traders obsess over individual stock setups, but very few build a system that starts with the market itself. The truth is that even the best stock patterns struggle when momentum is absent and breadth is contracting. On the other hand, when the market enters a strong setup—momentum expanding, participation broadening—suddenly even average stocks look like winners, and A+ names can carry entire portfolios.

Start from the top. Make recognizing market setups the foundation of your process. That’s when you want to put on size and press—when conditions align across the board. When the market is weak, patience and defense are the real edge.

## Discipline Turns a System Into an Edge

One of the easiest traps to fall into as a trader is breaking your own rules. The moment you stop following your system, you invite randomness into your trading, and random actions lead to random results.

A trading system isn’t about perfection, it’s about consistency. Rules exist to protect you from emotional decisions in the heat of the moment. Every time you override them, chasing an entry, skipping a stop, sizing impulsively, you chip away at your edge and replace it with chance.

The solution? Commit to discipline. Execute your plan as written, review it regularly, and only change rules deliberately, not mid-trade. Over time, consistency compounds. Without discipline, there is no system, only luck.
