Find the Zone - 1 Finding the Zone New Perspectives on the...

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Finding the Zone: New Perspectives on the Mental Game of Trading Brett N. Steenbarger, Ph.D. www.brettsteenbarger.com This is a draft of an article that has appeared in the December, 2002 issue of SFO Magazine. The actual article can be accessed by registering at the SFO site: www.sfomag.com A number of recent books have emphasized trading as a performance activity, in which mental state is a key element in success or failure. So prevalent is this view that two separate books with the same title— Trading in the Zone —have appeared in the last two years. What is this “zone” and how can traders reach it with consistency? In this article, I will review ideas about the zone from a variety of sources, including new research in cognitive neuroscience, and spell out the implications for futures and options traders looking to improve their mindsets—and their profits. Understanding the Zone The idea of a performance-enhancing zone originated neither in athletics or trading, but in the philosophy of Zen Buddhism. In the 1930s, Eugen Herrigel traveled to Japan to learn Zen through the practice of archery. Nearly two decades later, his book, Zen in the Art of Archery , popularized the notion of achieving excellence through mental discipline. His book was the inspiration for the popular novel Zen and the Art of Motorcycle Maintenance written by Robert Pirsig. Interwoven in Pirsig’s story of a father and son rediscovering each other on a motorcycle journey is a serious exploration of the experience of “quality”. Traveling on a cycle, Pirsig explains, possesses a different 1
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“quality” from driving a car. In the latter, you are always watching reality through a frame, shut inside a compartment. On a cycle, he writes, you are “ in the scene, not just watching it anymore, and the sense of presence is overwhelming.” This fusion of actor and act, performer and performance, is experienced as “the zone”. Crucial to the philosophy of Zen—and to the accounts of Herrigel and Pirsig—is the idea that our normal state of consciousness ruins the quality of the Zen experience. As soon as we consciously think about our performance, we are no longer one with it. Trying harder at a task only compounds this separation. The discipline of the Zen archer can be found in the performer’s ability to still the mind, remove mental interference, and allow instinctively honed skills to manifest themselves naturally. In their books Trading in the Zone , authors Mark Douglas and Ari Kiev emphasize the importance of focus and concentration in reaching a state where trading flows without seeming effort. Both authors view the zone as an outgrowth of trading discipline and a positive mindset. Once the trader lapses into patterns of fear, greed, and frustration, the zone is lost and instincts born of long hours of observing market patterns cannot emerge. For the trader, as for the Zen archer, turning off the mind is a crucial element in success. But how valid is this notion of the zone?
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Find the Zone - 1 Finding the Zone New Perspectives on the...

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