In a bid to rid myself of the aches and pains of old age, last week I tried out a yoga class.

I was fully expecting to be the only man in the room, and I was ready for the screaming pain of being forced to stretch out hamstrings that have been contracted by years of football and running.

But the thing that got me fidgeting uncomfortably like a 6-year-old at the back of a maths class was the “touchy feely” stuff – the bit where I had to close my eyes, breathe deeply, and clear my mind …

Fat chance!

What my yoga teacher told me (in a slow, calm voice, that I expect I was meant to find relaxing!) was that I was failing to enjoy my life to the full because of an inability to live in the present. By being constantly preoccupied with concerns about the future and the past, my life was passing me buy. In essence, I was “absent” from the present.

So, as I sat on the hard gym floor, did I feel myself transcending to a happier place?

No. But I was thinking about what she was telling me.

I was wondering how I could apply this to my trading – how I could implement the psychology and philosophy of it!

It appears that when it comes to meditation, I’m a dismal failure.

I hope that I can make up for it with my trading.

Trading in the present – a psychology that will allow you to trade what you see

It’s certainly true that I hamper my trading by my prejudices about certain stocks or how trades have panned out for me in the past. I also make mistakes because I’m too focused on my future goals – how successful I “want” this trade to be, or how confident I am that the market will behave in the way I “expect” it to.

These are the factors that cause me to trade what I “think” rather than what I “see”.

It causes me to speculate based on what pundits are saying on news channels ….

It causes me to hold on to losing trades because my ego won’t accept that I’ve got it wrong …

And it causes me to get greedy, pushing too hard for profits that just aren’t there.

What I need to do is trade in the present. Dwelling on the past is counterproductive, and trying to predict the future is impossible. We cannot predict the future – we can only base our trades on the best probabilities.

Inner peace – without the meditation

Okay, so, if we’ve agreed that we need to get “into” the present and to “let go” of the past – how exactly are we supposed to do that?

Don’t worry – I’m not about to suggest a course of meditation. I think I’ve already proved that I’m no good at that.

What we require is a strategy that allows us to do this – one that answers all those niggling questions about past and future for us – so that we can put them to one side, and get on with the business of trading.

First, let’s draw up a list of questions that the strategy will need to address for us …

1. What are my signals for buying or selling at any time?

2. How do I determine how much to buy or sell at any time?

3. How do I determine when to buy or sell?

4. How do I know when to get out of a losing position?

5. How do I know when to get out of a winning position?

I can already feel myself getting calmer …

If you suspect that you couldn’t answer each of these questions for every trade you place – then it’s inevitable that some of your trading will be influenced by emotions, by prejudices and by ego.

If, on the other hand, you can answer each question – you’re well on your way to trading enlightenment!

In the next seven days …

Most market commentators are in agreement that the interest rate rise is likely to come in May. However, that won’t stop a lot of speculation next week, ahead of the Bank of England’s interest rate announcement on Thursday.

This week’s figures showing surprisingly low growth in the service sector has set economists and traders on edge. If the sector is too week, an interest rate rise in unsustainable. Hence, yesterday’s data caused a sharp decline in the value of the pound.

Next week also sees the release of manufacturing and industrial production figures from the UK (Thursday), Germany (Wednesday), Italy (Thursday), France (Thursday) and China (Friday) – all are expected to show sustained growth.