How Great Traders Thrive Under Pressure

by Darrin Donnelly on September 4, 2014

Over the past seven years, I’ve been coaching stock traders from all over the world. I sort of stumbled into this career as a trading “coach.”

After updating and revising the legendary Darvas Trading System for modern market conditions, I started a small little newsletter to share my implementation with those who were interested. This service grew faster than I expected and I now teach fund managers, financial advisors, and independent traders from all over the globe. Some of these traders are beginners, some are managing small personal accounts, and some are rich enough to have stadiums named after them.

While my newsletter is a how-to guide with predetermined buy points and exit points for every stock trade that fits the strategy, I also make it a point to answer every email I receive from my readers. This is where I went beyond simply writing about the Darvas System and became more of a trading “coach”.

I love being a coach for other traders. I love teaching and interacting with ambitious individuals. I learn so much from our interactions and it helps me become a better trader in the process.

Not surprisingly, after years of doing this, I’ve started to see some common recurring problems emerge. Regardless of background or experience level, some traders will struggle with the exact same issues again and again.

In particular, I’ve noticed that no matter how specific the information in the newsletter is, some readers constantly run into a similar mental block when it comes time to execute a trade. They understand the strategy and they know exactly where the system says to buy or sell, but when it comes time to make the trade, they hesitate. They email me about missing a trade and explain that they just couldn’t pull the trigger (then they want to know if it’s too late to get in the trade at this point).

I can’t help but notice the repetitive nature of this problem. When the pressure turns up, indecisiveness and fear creeps in. People talk themselves out of doing things that, had the pressure of the situation been less intense, they would have had no problem doing.

Obviously, trading in the stock market is a high-pressure environment. I don’t care if you’re trading millions of dollars or hundreds of dollars, when your money is on the line, you feel pressure.

There’s no way to avoid this pressure. It’s part of the game. In fact, any worthwhile goal is going to involve pressure.

The bigger our dreams are, the more pressure we can expect to encounter. The older we get and the more responsibilities we have, the more pressure we have to deal with. We’re all under pressure and it’s not going away.

We can either let pressure debilitate us and make us stressed, worried, and angry; or, we can learn how to embrace pressure and maintain our peace of mind. We can learn how to use pressure to our advantage.

Confronting pressure doesn’t have to be a negative experience. You can be successful and happy in even the highest-pressure situations. In fact, top traders, athletes, doctors, entrepreneurs, firefighters, and cops do exactly that. When the pressure increases, they don’t try to avoid it by becoming indecisive and they don’t run away in fear. Instead, they rise to the occasion and use the pressure to their advantage.

The battle against pressure is all in your head. You get to choose how you deal with it. You’re the one who gets to decide if you’re going to let pressure work against you or for you. It’s up to you whether you let pressure knock you off the path to success or whether you use it as fuel on the road to accomplishing your dreams.

To make pressure your ally, you need to train your mind to consistently defeat the negative effects of pressure and embrace the positive effects. You need to master mental training techniques that will keep you positive, clear-headed, and decisive in high-pressure situations.

Here are five simple techniques that I’ve found useful.

1) Redefine Pressure
Most people make the mistake of associating pressure with stress, but that confuses a cause with an effect. Stress is a negative effect that can be caused by pressure, but it doesn’t have to be. Again, you get to choose whether the effects of pressure are positive or negative.

High achievers see pressure as a cause of excitement, not stress. When the pressure increases, they recognize that it means something exciting is happening. Life gets more fun when the pressure increases because it gives us an opportunity to grow and achieve and do things we would have otherwise never done.

Remind yourself every day that pressure is a positive force. Pressure is fun. It causes energy and excitement.

2) Visualize a Positive Outcome
Right before making a high-pressure decision, such as a trade, many people will freeze up with indecisiveness. Why do they do this? Because they fear that the result of their actions will be negative. The trader fears that he or she will lose money on the trade so they avoid the trade altogether.

However, what if this trade ends up being the biggest winner of the year? Those familiar with trend following systems like the Darvas System know that it only takes one or two big trades to make your portfolio a huge success for the year. Therefore, it’s important to realize that the next trade you make just might be your biggest trade of the year.

High achievers will visualize the positive outcome (this trade could end up being the biggest winner of the year) rather than the negative (this trade could end up being a loser). We see this often in sports as well. Before his swing, the successful golfer visualizes the drive landing right in the middle of the fairway, not way out in the rough.

Focusing only on the negative will cause you to hesitate and avoid taking action.

3) Visualize the Not-So-Bad Negative Outcome
Positive visualization is required to overcome fear and indecisiveness, but when it comes to trading (and many other big decisions) one also has to be realistic and recognize the reality that things won’t always turn out with best case scenarios.

What’s the solution? Consider the worst case scenario and recognize that it’s not that big of a deal.

If the trade goes against you, what does that mean? If you’re smart and following a quality trading system, it means that you’ll hit your predetermined safety stop and the damage will be minimal (just a 1% or 2% loss for most trading systems).

When you walk yourself through the worst case scenario, you realize very quickly whether the risk is worth the potential reward. A good trading system is designed to keep a favorable risk-versus-reward scenario. If the risk of a worst case scenario is minimal – as it should be – it alleviates the stress of the situation and makes it much easier to make sound decisions.

4) Replay Past Successes in Your Mind
One of the best solutions to dealing with a high-pressure environment is to remember past moments of success. In the case of a trader, you’ll want to look back on your biggest winning trade from the previous year and remind yourself how glad you were that you entered that trade when you did. For the entrepreneur, you’ll want to look back on the product launch that blew away expectations. For the athlete, you’ll want to remember those moments when you came through with the game on the line.

You can also use other people’s success as your motivational reminder. You can take time each day to read some of the most inspiring stories about other traders achieving success. You can look back on great sports moments like the Miracle on Ice. You can even call to mind great movie moments, like the finale of Rudy and The Pursuit of Happyness.

Reflecting on past successes instantly reminds you that great moments come about only after high-pressure moments. Remember that great pressure is a great opportunity.

5) Love Yourself
I know this technique may cause some to roll their eyes, but loving yourself is essential to achieving success – especially when the pressure is turned on.

We don’t make very good decisions when we’re angry and down on ourselves. When we feel like we’re unworthy of success, we tend to do things that make us unsuccessful.

Talk lovingly to yourself every day. You have so much to be thankful for and so many accomplishments to be proud of. Give yourself a verbal pat on the back and be proud of the hard work and study you’ve put in to reach this moment of opportunity in your life.

Even past failures are something to be proud of. Why? Because it took courage for you to encounter them. Be proud that you had the courage to try something different, even if you failed at it.

People who feel loved have a higher sense of self-worth. They make better decisions and achieve more success than people who think poorly of themselves. Love yourself, your success depends on it.


These are just five simple mental training techniques that will help you thrive under pressure. There are dozens more that may work for you. The key is to put them into practice. To thrive under pressure, you have to implement these techniques often. Go over them every day. Repeat them again and again until they become second nature to you.

Not only will these mental training techniques make you better handle the pressure of trading better, but they’ll also help you better handle the pressure of life.



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