Key Points:

1. Participants explored the practical application of cognitive defusion by repeating and altering self-critical phrases.
2. The session introduced the “milk exercise” to demonstrate how repetition can diminish the emotional impact of words.
3. Discussions focused on applying defusion techniques to thoughts and trading behaviors.

Summary:

This session built on last week’s introduction to cognitive defusion by diving into practical exercises to disarm negative self-talk during trading. Sean started by inviting participants to share common negative thoughts they have while trading, such as “I suck at this” or “What were you thinking when you took that trade?” Using these personal examples, the group experimented with mindfulness and defusion techniques designed to change how these thoughts impact their mindset.

Sean introduced the “milk exercise,” where participants repeated the word “milk” for 90 seconds, noticing how it quickly lost its meaning and became just a sound. This exercise highlighted how repetitive thoughts lose power when detached from their emotional weight. Sean emphasized that words are sounds and that by manipulating how we interact with them—speeding them up, slowing them down, or using silly voices—we can alter their influence.

Participants then applied this approach to their negative self-talk. The exercise revealed how repeating phrases like “I’m a fucking idiot” can transform them from emotionally charged statements into neutral or even humorous expressions. This shift is the essence of cognitive defusion—changing our relationship with thoughts so they no longer dictate our emotions or actions.

C.L.E.A.R. Mindset Connections:

Connect to the present moment and enhance your self-awareness with practical techniques.

• Participants were encouraged to observe their real-time reactions to repeating negative self-talk, thereby gaining greater awareness of how these thoughts influence their trading.

Loosen your attachment to thoughts and emotions, and cultivate mental clarity and resilience.

• Participants practiced loosening their attachment to these thoughts by repeating and manipulating their negative thoughts, reducing their emotional impact.

Embody your core values and align them with your actions to foster authenticity and purpose.

• Sean highlighted the importance of asking whether thoughts like “this is a good entry point” align with one’s trading rules and values, helping participants stay true to their trading plan.

Accept all the present moment offers, whether wanted or not, and find peace and strength.

• The group was encouraged to accept their negative thoughts without judgment and see them as opportunities to practice defusion rather than as truths that must be acted upon.

Respond with decisive, informed action, transforming challenges into opportunities for growth.

• By practicing defusion, participants gained tools to respond more thoughtfully to trading impulses, potentially turning challenges into learning experiences.

Actionable Strategies:

• Practice the “milk exercise” with negative self-talk to reduce its emotional charge.
• Use defusion techniques, such as altering the speed and tone of self-critical phrases, to change your relationship with these thoughts.
• Apply mindfulness to notice when solid emotions or urges arise during trading, and practice defusion to stay aligned with your trading plan.
• Experiment with defusion in moments of indecision or overconfidence in the market to maintain objectivity.
• Regularly reflect on how well your thoughts and actions align with your core trading values.

Act Accordingly:

The session’s focus on cognitive defusion provided practical tools to transform how you interact with negative thoughts and impulses during trading. By practicing these techniques, you can cultivate a resilient, clear mindset that aligns with your values, ultimately giving you an edge in your trading psychology.