Research studies have demonstrated that when people's psychological resources are taxed to the limit, they make impulsive mistakes. Maintaining discipline takes psychological energy, and when you use it up, you have to rest. Just like a muscle, when you are worn out, you need to take a break and regain your strength. It's vital to consider that the mind has limited energy, and that after putting in a hard and tedious effort, you must take a rest and rejuvenate, so you can face the market action with a renewed sense of vigor. Holidays are one of the best times to stand aside and regain your composure. Trading often comes down to performing in a peak performance state at a few key moments. To take advantage of these key moments, you must be relaxed. If you have strained your mental "muscles," you'll have difficulty taking advantage of these opportunities. Your mind will be elsewhere or you'll be too tired to act decisively. When you're tired, it's hard to gauge market action accurately. You'll be prone to decision-making biases and you may act impulsively because you are too tired to patiently wait for the proper signals to enter or exit a trade. By staying relaxed yet full of energy, you'll be able to trade in a logical and disciplined manner. You don't need to perform at a peak performance state every minute of your life. Many people can work for only a limited number of hours a day, and if we try to work in marathon stretches, it eventually catches up with us, and is shown by our weak performance. Just as a runner must rest when his or her muscles ache, it's vital to take breaks after a marathon work session. Part of trading profitably is the acknowledgment of your limitations and putting together sensible ways to work around them. Don't think you are superhuman. Take a few days off to rest and regain your mental and physical strength. Get plenty of rest so that next week, you will be ready to handle whatever the market throws at you.
I seriously wish this was my life right now: http://www.youtube.com/watch?v=HnoBfVJd_r8&feature=fvw I am so blasted tired.
In the 90's I was part of a trading group (arcade) and the guys with the most discipline problems, trading mistakes, overtrading et cetera tend to be the ones that party all weekend long or made trading a +15 hour a day job. Thus, don't underestimate the power of rest and relaxation (r&r) because it's important for traders just like it is for any other profession. As for myself, I plan on adding more time off to my trading schedule. In fact, the spouse has recently suggested I select an entire month in the summer to go on a one month long vacation as a routine along with the few weeks I already take off for vacation per year. I'm strongly considering her suggestion especially if I have more of a say so to where we go. Mark