Trading Stress Management: Why Traders Should Close the Loop
What the Military Teaches Us About Stress
Did you know that your brain, yes, yours! HATES open loops?
- If you’ve ever felt stressed about a never-ending to-do list,
- Or found yourself constantly thinking about a trade you’ve got on…
- Or lying in bed replaying something you forgot to do…
That’s an open loop.
And your brain does not like leaving them unresolved…
CLOSING THE LOOP
The military discovered that after missions, soldiers often experience a huge spike in cortisol (the body’s stress hormone).
The obvious solution here was rest…
Mission finished – get some sleep – reset.
But they found it didn’t always work like that.
Rest alone doesn’t always reduce stress.
Huh?
Yeah… they found that the brain needs a signal that the mission is finished, otherwise it keeps what’s known as an ‘open loop’.
So the military created post-mission rituals.
Things like:
- Cleaning rifles
- Packing away gear
- Debriefing the mission.
Now, sure, these things have operational benefits…
But they also serve another purpose.
They close the loop.
Once the brain thinks the mission is complete, stress levels drop, and recovery becomes much easier… that rest and sleep become so much more nourishing.
We traders have the same problem.
Trading can become a forever open loop if we let it…
Positions running, market trading 24/5, and never ending news flow (especially now).
And we just saw that the brain hates open loops.
Day traders always say, “Nice to go home flat” That’s because, intentional or not, they close the loop. Regardless of how the day went, it’s done, closed. Go again tomorrow…
Swing traders don’t get this naturally. Positions are still open, and the market is still moving. So the brain stays engaged.
Either way, you need to create a post-market routine that closes the loop for the day.
Something that supports your trading but also your brain…
Things like:
- Writing down your positions and executions
- Stop levels
- Screenshots and market notes
- Logging the day in your journal.
Anything to close the loop so your brain can switch off…
We both know that trading can be stressful, like it or not, that’s the nature of the beast.
So anything you can do to help your brain stay sharp and make better decisions… can’t be a bad thing, right?
Go close that loop.
I went into more detail about closing the loop in my latest podcast episode. Take a listen this weekend if you get a chance 
The Military Trick That Helps Traders Switch Off