Research is showing how powerful our mental context is in making risk decisions. But the thing is, most traders think mental context is about what they know – their insights, their indicators and their experience. In reality, it goes much further and deeper than that.

Recent experience that seems totally unrelated to trading counts. For example, if you work on a desk, then the adminis-trivia and in particular, its effect on your attitude will influence your trading. If your boss or colleague seemed to criticize – or compliment – you, it will influence your trading.

College students have been shown to walk slower after hearing the words gray hair, glasses, knee replacement. Interviewers have shown they can feel differently about a candidate depending on the temperature of the coffee cup they just held. Our unconscious sensory and information machine is working all of the time. It pays to make it an asset and not a liability.

But first you have to believe that perception, judgment and decision making emerge from something more than your intellect. It’s tough. We all went to school on intellect. Today however being exceptionally smart is also being aware of decision factors not traditionally analyzed.

And that is about all it takes – being aware that there is a context of senses and feelings in operation that is contributing to what it seems you are seeing. If you are aware of it, you can verbally identify it and in doing so, you virtually factor it out. For example, I feel ________ because of ________ will improve your analysis of the speed, rhythm and implications of price action.