The present moment is the only time you have, or will ever have.
That’s a fact. You cannot operate in the past or in the future.
However, this is all so obvious that we seem to ignore it.
We spend our time and mental capacity thinking back over what has happened and thinking forward to what will happen.
The first often involves self-judgement while the latter regularly amounts to unfounded worry.
We do this instead of acting and living in the present moment.
John Lennon put it well when he said that ‘Life is what happens while you are busy making other plans‘.
Of course you can review the past to learn from it and you can plan for the future.
But you do even this in the present moment.
The Importance of the Present Moment
While he was coming at it from a somewhat different angle, Eckhart Tolle put this very well in his bestselling book ‘The Power of Now: A Guide to Spiritual Enlightenment‘ when he wrote that:
Nothing ever happened in the past; it happened in the Now. Nothing will ever happen in the future; it will happen in the Now. What you think of as the past is a memory trace, stored in the mind, of a former Now. When you remember the past, you reactivate a memory trace – and you do so now. The future is an imagined Now, a projection of the mind. When the future comes, it comes as the Now. When you think about the future, you do it now. Past and future obviously have no reality of their own.
Tolle has been widely read in recent years and has a high profile not least because of celebrity endorsements, in particular from Oprah Winfrey.
You may see this as a negative or a positive in terms of his credibility – that’s your decision.
But either way, there is no denying the deep truth in what he is saying here.
So, only the present moment matters. And the information that is provided to you in the present moment should matter to you when making decisions.
The Present Moment when Trading
When trading, it is very important to recognise this and keep your focus on the present moment for two important reasons.
First, you need to trade dispassionately. This does not mean you aim to act like you have no emotions.
If you try to do so you will fail for the simple reason that you are an emotional being. You can read more about this in this post.
You cannot change this, so don’t try to do so.
You must minimize the impact of your emotions on you trading decisions not by eliminating them but by being consistent.
This means that you must be emotionally stable when trading.
The greatest threat to this is if you allow the emotions that are generated by the outcome of past trades to affect your decisions.
This is dangerous if you have experienced a string of losses but even more dangerous if you are on a winning streak.
Neither experience has any relevance to the outcome of your next trade.
So the emotions you inevitably feel in either case must not influence the decisions you make in the present moment.
The second reason is that you need to be able to focus solely on the information the market is providing to you right now.
If you don’t do this then you are introducing irrelevant information into your decision.
It’s so important to always remember that the flow of information is always in one direction: from the market to you.
So, if you are allowing other information to influence your trading decision, you are basing it on information about which the market knows nothing.
So it is irrelevant. You end up trying to get the market to do what you want. You are then trading on hope. This is random trading.
Developing Your Focus
There is no denying the truth in the above. But changing the habits of a lifetime can be difficult.
Step back from trading for a moment and begin with Tolle’s approach.
While Tolle often avoids using the term mindfulness, it is clear that much of his writing is about mindfulness.
Take a few moments to watch this short video where he outlines his ideas.
You’ll find he’s quite a funny and engaging speaker, something that does not always come through in his writing.
Now see if you can begin to incorporate his ideas into your trading routine.