What happens in your body when the number turns red?

Why this matters. Something physical happens, it affects judgement, and the confident-sounding account of it you will read elsewhere is mostly not supported. Both halves matter.

A position moves against you and something changes before any thought does. Heart rate, attention, the quality of your breathing. You did not decide it.

What is actually documented

Documented but thin, and the limitation belongs in the same sentence: Coates and Herbert (2008) measured cortisol and testosterone in City traders and found cortisol rising with market variance — seventeen traders over eight days. Suggestive. Not a general result. Lo and Repin (2002) recorded physiological responses in professionals during live sessions — ten subjects. A demonstration that bodily response tracks market events, not a law about it.

So: real, measured, and on very small samples.

What is not documented, and is everywhere

Folklore, named so you can recognise it: the arousal-performance curve — a little stress helps, too much hurts — is attributed to Yerkes and Dodson (1908). That work was done on mice under electric shock, and nearly every application of it to trading is an extrapolation the original does not support. You will meet this curve constantly. It is being told to you as science.

This course teaches it only so you stop being persuaded by it.

What follows, practically

Not a breathing technique. This domain does not prescribe folklore, and the evidence for any specific intervention in this setting is not there.

What follows is narrower and defensible: your physical state is information about the conditions of a decision, and it can be recorded beside it. Not treated as a signal about the market — as metadata about the decision.

The artefact

A state note: one word beside a decision record for how you felt taking it. Calm, rushed, tired, angry. One word, no analysis.

Its value is entirely retrospective. After fifty decisions you can ask a question no amount of introspection answers: do the decisions marked "rushed" differ from the rest?

The note has one use that is not retrospective. If the same word sits beside most decisions for weeks, the state has become a condition, and the input that most often sets it is size. A position large enough to disturb sleep impairs judgement in anyone; size is adjustable in a way temperament is not. Course 3 runs that check before anything in this domain, in Which of your problems are not psychological at all?. What a given size does to exposure belongs to Technical Analysis, in What does position size actually decide?. Here the point is narrower: a state note that never changes is a fact about the size.

Try it now

Add one word to your most recent decision record. That is the entire practice.