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Market Oracle FREE Newsletter

Category: Trader Psychology

The analysis published under this category are as follows.

InvestorEducation

Friday, March 10, 2017

This Time Is Different - 4 Words That Broke Many Investors / InvestorEducation / Trader Psychology

By: John_Mauldin

BY PATRICK WATSON : Four little words may have cost more investors more money than anything else in stock market history: This time is different.

Granted, in a sense, every time is different. History never repeats itself in exactly the same way, but it can certainly rhyme.

Read full article... Read full article...

 


InvestorEducation

Tuesday, December 01, 2015

Financial Markets are a Psychological Phenomenon - Video / InvestorEducation / Trader Psychology

By: EWI

Interview with Robert Prechter

Watch this 2-minute video where Robert Prechter talks about his developing theory on finance with Douglass Lodmell for The Mind Of Money series.

Since then, Bob has been hard at work on his new book about his now fully developed theory on finance (scheduled for completion in 2016).

Read full article... Read full article...

 


InvestorEducation

Friday, August 28, 2015

How I Learned to Stop Worrying and Love Market Fluctuations / InvestorEducation / Trader Psychology

By: John_Mauldin

Patrick Cox: Most of you know that my day job involves finding disruptive technologies for investors. Most of you also know that the stock market has recently taken a southward plunge.

When I was younger, I always wondered why big fluctuations in markets seemed to cause so many people so much anxiety and consternation. It’s not as if we don’t know that, historically, markets have always displayed big swings. Understanding this, it always seemed clear to me that a rational individual would not invest money in equities if that money might be needed in the short run.

Read full article... Read full article...

 


Stock-Markets

Monday, March 23, 2015

The Psychology Behind Your Stock Market Pessimism / Stock-Markets / Trader Psychology

By: Investment_U

Alexander Green writes: Over the course of the last few columns - and during my recent talks at the Investment U Conference - I’ve laid out my case for viewing the future of the economy and the stock market optimistically.

Yet Editorial Director Andrew Snyder polled our readership and found that only 38% of you agree with me.

Read full article... Read full article...

 


InvestorEducation

Thursday, March 05, 2015

The Psychology of a Sideways Stock Market Trend / InvestorEducation / Trader Psychology

By: Clif_Droke

A fascinating study is the psychology that accompanies a prolonged sideways market trend.  It also holds insights into what the future likely holds for stock prices.

When equities get stuck in a sideways trend for several months, investor psychology goes through four basic stages of change: 1.) initially they feel expectant that stock prices will quickly breakout of the newly formed range; 2.) when this fails to materialize sentiment turns sour as stocks drop to the lower boundary of the range; 3.) as stocks continue bouncing from the top to the bottom of the range investors begin to lose interest and eventually quit participating altogether with many selling their stock holdings.  This is what forms the basis of a bullish accumulation pattern since “smart money” professional investors eagerly snap up the disgorged supply from disgruntled retail investors.  4.) Finally, as the range is nearing its final resolution, small investors who may, or may not, be invested are thoroughly frustrated at the lack of directional movement. 

Read full article... Read full article...

 


InvestorEducation

Thursday, August 21, 2014

Why Emotional Discipline is Key to Trading Success / InvestorEducation / Trader Psychology

By: EWI

If you are serious about trading, Elliott Wave International's (EWI) Jeffrey Kennedy has some advice for you: learn emotional discipline. In this article from his Trader's Classroom Collection, he shares some expensive lessons he learned during his 20+ years trading the markets.

Read full article... Read full article...

 


InvestorEducation

Friday, March 14, 2014

Predicting Human Behavior - Social Mood Conferencel , Get the Socionomic Edge / InvestorEducation / Trader Psychology

By: EWI

Find out how at the 4th Annual Social Mood Conference

Robert Prechter forecasted more than 10 years ago that the War on Drugs would become more violent, leading eventually to the decriminalization of the possession and sale of recreational drugs. The Socionomist followed up in 2009 with an in-depth story by Euan Wilson called "The Coming Collapse of a Modern Prohibition." We published an update in November 2013, "Marijuana: The Mood Shifts, and Decades of Prohibition Go Up in Smoke," that was a timely reminder just before marijuana stocks exploded in early 2014. The recent rush of new state laws to decriminalize pot bears out these forecasts.

Read full article... Read full article...

 


InvestorEducation

Friday, March 07, 2014

How Understanding Market Psychology Can Help You Time the Market / InvestorEducation / Trader Psychology

By: EWI

Two economic reports hit the newswires Thursday morning (March 6). Both were important, yet each one had the opposite implication for the trend.

The market chose one report over the other, and the question is, why -- and what can we learn from that?

Read full article... Read full article...

 


InvestorEducation

Friday, February 07, 2014

Dead Man’s Curve - Let's Hear it for Brain Damage / InvestorEducation / Trader Psychology

By: Janet_Tavakoli

Let’s hear it for brain damage. The Journal of Economic Literature reported that with regard to investments “frontal damage can result in superior decisions,” in the article “Neuroeconomics: How Neuroscience Can Inform Economic".

At least that is what the authors—Colin Camerer of the California Institute of Technology’s Division of the Humanities and Social Sciences, George Loewenstein of Carnegie Mellon’s Department of Social and Decision Sciences, and Drazen Prelec of the Massachusetts Institute of Technology’s Sloane School of Management—believe, even though such damage results in poorer overall decision-making ability.

Read full article... Read full article...

 


Stock-Markets

Tuesday, November 19, 2013

Are Market Bubbles Caused by Psychological Problems? / Stock-Markets / Trader Psychology

By: Frank_Shostak

According to the popular way of thinking, bubbles are an important cause of economic recessions. The main question posed by experts is how one knows when a bubble is forming. It is held that if the central bankers knew the answer to this question they might be able to prevent bubble formations and thus prevent recessions.

Read full article... Read full article...

 


Stock-Markets

Sunday, October 27, 2013

Is Stock Market Perma-Bearishness a Form of Mental Illness? / Stock-Markets / Trader Psychology

By: Investment_U

Alexander Green writes: There was a revealing story in this week’s Wall Street Journal…

David Rosenberg, the chief economist and market strategist at Gluskin Sheff & Associates, spent a decade warning about the health of the U.S. economy and the future of the stock market. That meant he missed the bull market a decade ago but helped the firm’s clients avoid the 2007 to 2008 financial crisis. Unfortunately, he missed the rebound that followed. (Such is the fate of market timers and other psychics and clairvoyants.)

Read full article... Read full article...

 


InvestorEducation

Wednesday, July 17, 2013

Nadeem Walayat's Trading Lesson - The Psychology of Technical Analysis, Past, Present and Future / InvestorEducation / Trader Psychology

By: Nadeem_Walayat

If you have read my past trading articles and ebook's you should understand that I consider Technical Analysis in large part to be a red herring in terms of the decision making process with regards trading. In that technical analysis assumes knowledge and understanding of past price history as the key towards trading success i.e. that the outcome of past price patterns are likely to repeat in the future and thus should be acted upon when they re-occur.

Read full article... Read full article...

 


InvestorEducation

Monday, April 22, 2013

Robert Prechters Video on How Market Losers Think / InvestorEducation / Trader Psychology

By: EWI

Dear Investor,

To become an independent investor, you have to crawl before you walk and walk before you run.

Even after you're on your feet, the first step isn't easy: A nudge in the right direction can help.

Read full article... Read full article...

 


InvestorEducation

Tuesday, April 09, 2013

The Confidence Game / InvestorEducation / Trader Psychology

By: David_Petch

Last night I was staring at a computer screen with numerous bullet points for this article and was wondering how to weave them together and what to call it. After sleeping on it, the perfect title for this came to me...”The Confidence Game”. In human psychology, there are many different levels of human emotion or behaviour, from which other forms of behaviours stem. This might seem like a pointless exercise, but follow the flow chart below with a background thought about relating this to money, the banking system and precious metals.

Read full article... Read full article...

 


Stock-Markets

Thursday, December 13, 2012

Important Factor In Determining Stock Trends and Election Outcomes / Stock-Markets / Trader Psychology

By: EWI

In the wake of the Presidential election, the Social Science Research Network (SSRN) reports that the study, "Social Mood, Market Performance and U.S. Presidential Elections" has earned the #3 spot among the most-downloaded papers in the past 12 months.

Read full article... Read full article...

 


InvestorEducation

Tuesday, December 11, 2012

Social Mood Impact on Stock Markets and Presidential Election Results / InvestorEducation / Trader Psychology

By: EWI

In the wake of the Presidential election, the Social Science Research Network (SSRN) reports that the study, "Social Mood, Market Performance and U.S. Presidential Elections" has earned the #3 spot among the most-downloaded papers in the past 12 months.

Read full article... Read full article...

 


InvestorEducation

Wednesday, August 15, 2012

Critical Trading Lessons - Trader Psychology: Don't Trade With Your Ego / InvestorEducation / Trader Psychology

By: EWI

Best Financial Markets Analysis ArticleSenior Analyst Jeffrey Kennedy is a busy man. Along with his regular duties at Elliott Wave International, he prepares 3-5 video lessons each week that teach technical traders how to anticipate -- and act on -- trading opportunities.

Subscribers say that what sets Jeffrey's educational service apart is his unique ability to combine easy-to-understand, actionable advice along with a no-nonsense, uncensored look at trading psychology.

Read full article... Read full article...

 


InvestorEducation

Wednesday, November 16, 2011

Investors Three Psychological Stumbling Blocks That Kill Profits / InvestorEducation / Trader Psychology

By: Money_Morning

Best Financial Markets Analysis ArticleKeith Fitz-Gerald writes: Face it, the past 12 years have been horrible for most investors.

This is not necessarily because the markets have been rocky, but rather because the vast majority of investors are hardwired to do three things that kill returns.

Read full article... Read full article...

 


InvestorEducation

Tuesday, November 08, 2011

Are Crowds Capable of Identifying Stupidity? / InvestorEducation / Trader Psychology

By: Aftab_Singh

Best Financial Markets Analysis ArticleHerd opinion seems to be a chronically troublesome matter for the allocator of capital. Not only does the herd hold a deep suspicion for making money as such, but it seems that agreement is regarded as an imperative when it comes to considering the future. I might contend that the question; ‘How dare they consider that which all of us are unable/unwilling to consider?’ contains the primary sentiment behind the crowd’s contempt and condemnation… Supposing that this suspicion is true it might be considered quite important for us, as speculators, to overcome this. As ever, we think that it is contrary thought that reveals the key to prudence. Here I invite you to mull over the controversial question in the title; is the crowd capable of correctly identifying intelligence and stupidity?

Read full article... Read full article...

 


InvestorEducation

Monday, February 14, 2011

The Short Story of How We Lose, The Concept of "Myopic Loss Aversion" / InvestorEducation / Trader Psychology

By: Ashvin_Pandurangi

Best Financial Markets Analysis ArticleA curious thing happened to a middle-aged Frenchman in Monte Carlo last year. He had unexpectedly received a year-end bonus of 10,000 from his employer, and decided to visit Le Grand Casino for a weekend, where he could relax and gamble with his new found wealth. Since his wife and daughters were visiting his stepmother that weekend, he would be able to focus entirely on making some money. His first night was judiciously spent at the Roulette tables, where his sharp instincts and calculated patience presumably allowed him to double his allotted wealth in just five hours. It was an excellent night for the man, who was now 10,000 richer, and he spent the next afternoon lounging in a cabana at the hotel's pool.

Read full article... Read full article...

 


InvestorEducation

Wednesday, February 09, 2011

Resolving the Stubborn Psychology of Fish / InvestorEducation / Trader Psychology

By: Ashvin_Pandurangi

Best Financial Markets Analysis ArticleFor those unfamiliar with the game of poker, it is essentially a game where players attempt to win money from other players at their table by having the best five-card hand at showdown or by betting their opponents off of the best hand. The most popular form of poker is Texas Hold Em', in which each player is dealt two "hole cards" followed by a round of betting, then a three-card "flop" followed with another round of betting, a one-card "turn" with betting, and finally a one-card "river" with the last round of betting. Each player can, but is not required to, use one or both of their hole cards, and must use 3-5 cards on the board, to construct their best possible five-card hand (from best to worst - straight flush, four of a kind, full house, flush, straight, three of a kind, two-pair, pair, high card).

Read full article... Read full article...

 


InvestorEducation

Saturday, May 29, 2010

Addicted to Trading! / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

Best Financial Markets Analysis ArticleDon’t just do something---sit there…Zen Koan

The most difficult thing for traders to do is to sit there and wait. Why?  Because, we live in a world that is on a total dopamine, hypomanic binge. This is never more clearly manifest than by those who absolutely have to be in the markets at all times, desperately need to be trading and simply cannot wait. They are human do-ings, rather than human be-ings.

Read full article... Read full article...

 


Stock-Markets

Tuesday, April 13, 2010

Common Sense, Bogus Metrics Plus Baloney Justifications, Is Silver cheap relative to Gold?  / Stock-Markets / Trader Psychology

By: Graham_Summers

Best Financial Markets Analysis ArticleAlmost every other day I receive an email from a concerned investor asking me if some asset is cheap relative to another asset or if some metric justifies that some perceived outcome is about to unfold.

Among the various question

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InvestorEducation

Friday, January 08, 2010

Trader Fatigue / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

Having trouble sleeping these days?  You aren’t alone.  The National Sleep Foundation’s 2009 study shows that some 30% of the U.S. population reports sleep disturbances. These include challenges with falling asleep, staying asleep or early-morning wakening with inability to get back to sleep.  Last year, there were nearly 57,000,000 prescriptions written for sleep meds.  That’s 57 million. In his book “Sleep Thieves,”  Dr. Stanley Coren says that lack of sleep is causing us to be “clumsy, stupid, unhappy and dead.”   Evidence is mounting that the tragic death of Michael Jackson was related to his inability to sleep without powerful sedative drugs.

Read full article... Read full article...

 


InvestorEducation

Monday, December 21, 2009

Are you Scared when you Trade Commodities? / InvestorEducation / Trader Psychology

By: Andrew_Abraham

I have seen countless times with inexperienced traders the fear that can come about. The reason of this fear is due to uncertainty in any particular trading situations. These traders do not have a plan. They get themselves into a situation in which they are losing money very quickly. Then there is the situation when one is scared and is stimulated to think. The reality is man is a lazy creature. He wants to be told what to do…how to invest and how to make money.

Read full article... Read full article...

 


InvestorEducation

Wednesday, October 28, 2009

The Psychology of Risk in Commodity Trading / InvestorEducation / Trader Psychology

By: Andrew_Abraham

Best Financial Markets Analysis ArticleThe psychology of risk in commodity trading is not that often of an issue discussed. I want to share an interview with my colleague Martin Bedick.

Read full article... Read full article...

 


InvestorEducation

Tuesday, October 27, 2009

Great Expectations / InvestorEducation / Trader Psychology

By: Charles_Maley

The best things in life are unexpected - because there were no expectations - ELI KHAMAROV

Legendary trader Roy Longstreet was once asked by Intermarket Magazine, “Why have you succeeded in trading to such a degree and why do most traders fail?”  Roy answered “Many major problems people have in trading are caused by their expectations – of where the market is headed, how much money will they make from this trade, etc. One thing I learned that has helped me: it is wrong for a person to enter any market with any preconceived expectations.”

Read full article... Read full article...

 


InvestorEducation

Monday, October 19, 2009

The Red Badge Of Courage, Financial Markets are No Place for Bravery / InvestorEducation / Trader Psychology

By: Charles_Maley

If you lose hope, somehow you lose the vitality that keeps life moving, you lose that courage to be, that quality that helps you go on in spite of it all. And so today I still have a dream - MARTIN LUTHER KING JR.

Roy Longstreet, legendary commodity speculator once said, “To trade successfully, one needs two things: Knowledge and Courage. The knowledge you can learn or buy. Courage cannot be learned or bought. You either have it or you don’t. But you cannot succeed without it.”

Read full article... Read full article...

 


InvestorEducation

Friday, October 16, 2009

Trading Trap, Failure To Truly, Madly and Deeply Believe In Yourself / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

Best Financial Markets Analysis ArticleMagic is believing in yourself. If you can do that, you can make anything happen...
Johann Wolfgang von Goethe.

This trap is deceptively simple because most people, when questioned, say that they totally believe in themselves and deserve to be successful as traders.

Read full article... Read full article...

 


InvestorEducation

Wednesday, October 14, 2009

The Rhythm Of Living / InvestorEducation / Trader Psychology

By: Charles_Maley

Action and reaction, ebb and flow, trial and error, change- this is the rhythm of living. Out of our over-confidence, fear; out of our fear, clearer vision, and fresh hope. And out of hope, progress - BRUCE BARTON (AMERICAN CONGRESSMAN 1886-1967)

Read full article... Read full article...

 


InvestorEducation

Thursday, October 01, 2009

Come Out Of Your Shell (Part 1) / InvestorEducation / Trader Psychology

By: Charles_Maley

We don't see things as they are, we see things as we are - ANAIS NIN US (French-born) author

I was having a conversation with one of my clients yesterday on the subject of whether good traders are born or whether they can be taught. I brought to his attention that this was the identical argument between Richard Dennis and Bill Eckhardt back in the early 1980’s.

Read full article... Read full article...

 


InvestorEducation

Thursday, October 01, 2009

10,000 Hours To Graceland / InvestorEducation / Trader Psychology

By: Charles_Maley

The world’s a stage and most of us are desperately unrehearsed - SEAN O’CASEY, IRISH DRAMATIST

Do we really have a clear understanding of raw talent? Is there such a thing as a natural born trader?

Read full article... Read full article...

 


InvestorEducation

Thursday, September 24, 2009

Are You Trading For Thrills Or Dollar Bills? / InvestorEducation / Trader Psychology

By: Charles_Maley

According to Ori and Rom Brafman in their book “Sway” the National Institutes of Health (NIH) conducted a rather interesting experiment. They gathered participants and placed them in a MRI like machine and gave them a computer monitor and a joystick. Then they played a game.

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InvestorEducation

Thursday, September 24, 2009

Would You Pay Over $200 For A $20 Bill? Don’t Be Too Sure / InvestorEducation / Trader Psychology

By: Charles_Maley

I just read a very interesting book. It is called “Sway”: The Irresistible Pull of Irrational Behavior.

Max Brazerman is a professor at The Harvard Business School and introduces his new students to a game at the beginning of the semester. He auctions off a $20 bill with only two rules to the game.

Read full article... Read full article...

 


InvestorEducation

Wednesday, September 23, 2009

Why Are We Such Suckers For Prediction? / InvestorEducation / Trader Psychology

By: Charles_Maley

I keep CNBC on all day while I work. Perhaps I think I will miss something, or maybe it’s the background noise that’s appealing. In any event, what I always find amazing is the parade of experts making one prediction after another. I think I would fall out of my chair if I heard one of them say “Well, to tell you the truth Mark, I have no idea”.

Read full article... Read full article...

 


InvestorEducation

Tuesday, September 22, 2009

A Mindset Is A Terrible Thing To Waste / InvestorEducation / Trader Psychology

By: Charles_Maley

Success is the ability to go from one failure to another with no loss of enthusiasm - SIR WINSTON CHURCHILL

Read full article... Read full article...

 


InvestorEducation

Friday, June 05, 2009

Which Came First, The Happiness or the Success? / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

Best Financial Markets Analysis ArticleWhat’s the deal with happiness and success?  

Why is it that we live in such an amazing world, filled with   blessings and opportunities, yet so few are happy?

Read full article... Read full article...

 


Stock-Markets

Thursday, June 04, 2009

This Stock Market is a Fool’s Paradise / Stock-Markets / Trader Psychology

By: Q1_Publishing

Best Financial Markets Analysis ArticleBernard Baruch, one of the world’s most legendary speculators, said, “The main purpose of the stock market is to make fools of as many men as possible.

Right now, that’s exactly what’s going on. And I assure you, a lot of folks will be made into complete fools in the next year or so.

Read full article... Read full article...

 


InvestorEducation

Friday, March 13, 2009

Trading Emotions, Fear, Greed and Hope / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

Best Financial Markets Analysis ArticleHow to Eat Like An Elephant - The legendary W. D. Gann spent a lot of time describing three emotions that drive most traders and investor—fear, greed and hope. You enter markets on the hope of gains, too often get greedy in expecting profits, and finally liquidate on fear . Your brain has not changed much from the time of the Neanderthal man who greedily hunted wild animals for food, and ran in fear from beasts and neighboring tribes that threatened his survival.

Read full article... Read full article...

 


InvestorEducation

Friday, February 13, 2009

How to Succeed in the Current Market Conditions / InvestorEducation / Trader Psychology

By: Nazy_Massoud

These are uncertain and confusing times. Everywhere you look, any conversation you listen to, it is about the economy and its impact on our lives. We hear about deficit, raising taxes, unemployment and lack of liquidity. It is enough to make everyone enter a negative emotional spiral.

How can you deal with these uncertain times?

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InvestorEducation

Saturday, January 31, 2009

President Barack Obama: The Temperament of a Champion Stock Trader / InvestorEducation / Trader Psychology

By: Investment_U

Best Financial Markets Analysis ArticleI think President Barack Obama would make an exceptional short-term stock trader.

I've never met the man, personally. And I know nothing about his stock portfolio or whether he even has one.

Read full article... Read full article...

 


Stock-Markets

Tuesday, January 20, 2009

Stock Market Investor Sentiment Indicator Remains at Neutral / Stock-Markets / Trader Psychology

By: Guy_Lerner

Best Financial Markets Analysis ArticleThe "dumb money" sentiment indicator remains neutral on the equity markets, and the "smart money" has turned more bearish. It should be noted that this is the sixth week in a row where the "dumb money" is neutral, and this is not a scenario that is generally supportive of higher prices especially with prices on the S&P500 under their 40 week moving average. The ideal situation for higher equity prices would be for the "smart money" to be bullish and the "dumb money" bearish (i.e., bull signal).

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InvestorEducation

Tuesday, December 02, 2008

Trading Markets Trap #2 Failure to Take Personal Responsibility for Your Trades & Investments / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

Best Financial Markets Analysis Article"One can have no smaller or greater mastery than mastery of oneself… " - Leonardo da Vinci

We buy stocks, options, futures, currencies, commodities, etc, because we want them to go up and make profits. We short them because we want them to go down and make profits.

Read full article... Read full article...

 


InvestorEducation

Thursday, May 22, 2008

Leadership and Trading / InvestorEducation / Trader Psychology

By: Nazy_Massoud

I was participating in a meeting the other day and the speaker was talking about leadership.

When I was thinking of leadership, it occurred to me that as traders, we own our business and we set its direction. We are leaders and how we run our business is very essential to our success.

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InvestorEducation

Thursday, April 03, 2008

How To Develop Your Mental Trading Edge / InvestorEducation / Trader Psychology

By: Nazy_Massoud

Best Financial Markets Analysis ArticleI was in Vegas speaking at a recent Trader's Expo. There were a lot of exhibitors, speakers and attendees. All were talking about how traders and investment managers could make more money.

There were various systems, numerous indicators to use, and various news sources to listen to.

Read full article... Read full article...

 


InvestorEducation

Wednesday, December 12, 2007

The Trading Doctor - Finding Your Trading Edge : Support & Resistance Levels / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

Best Financial Markets Analysis Article“I'd be a bum on the street with a tin cup if the markets were always efficient…” Warren Buffett

Edges are what separate successful from unsuccessful traders. Those traders who find and exploit edges are the ones who end up winning. Moreover, the ability to execute on an edge is at the heart of behavioral trading.

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Stock-Markets

Sunday, December 09, 2007

The Psychology of Investing in the Stock Market From 1996 to 2007 / Stock-Markets / Trader Psychology

By: David_Petch

Best Financial Markets Analysis ArticleTaxidermy refers to the job of taking the skins of dead animals and mounting them onto a plate of some form that depicts them in a naturally occurring state. With the era of photography and cartoons, this is not required for today's article. Instead, pictures are strategically placed onto the S&P 500 Index chart to “capture” what the general populous was thinking at a particular point in time.

One of the main reasons for this article taking along time to publish was finding the appropriate pictures. A picture is said to be worth 1000 words, so each picture is supposed to be representative of the thoughts of each individual at a certain point in the stock market cycle. The stock market is a barometer of how the economy is doing and the footprint left by the "tape" directly captures the summation of all participants. Many assume the market is a random beast that does not follow any particular pattern, but instead, quite the opposite is true.

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InvestorEducation

Monday, December 03, 2007

Traders - Get a Mental Edge to Avoid Tripping Yourself Up! / InvestorEducation / Trader Psychology

By: Nazy_Massoud

Have you been in situations where you had several winning trades which were wiped out by one losing trade?

Have these become a pattern?

Like some of my clients, you may be saying, “I have spent hours creating my plan.” Then you start the day with every intention of following it. After a few losing trades, you lose your control and with that, your plans go out the window. You try to make up for your losses by chasing after deals and increasing the size of your trades. So you get in at the wrong entry point and the size does not warrant the risk.

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Stock-Markets

Friday, November 16, 2007

Stocks Bull Markets Climb a Wall of Fear / Stock-Markets / Trader Psychology

By: Regent_Markets

After the party comes the hangover, and of course the bigger the party, the bigger the hangover. Over the last few years, financial companies have been gorging themselves on 'foolproof' credit trades, based on sub prime debt. Now the party is over and companies are having to face up to their antics in the cold light of day, says BetOnMarkets.com's Michael Wright.

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InvestorEducation

Sunday, November 04, 2007

Intuitive Trading: Fact Or Fiction? - Part 1 / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

Best Financial Markets Analysis ArticleWhy did you sell silver yesterday? Why did you buy the S&P e-mini (ES) just now? Why did you decide to cover your shorts in the dollar? Why? Why? Why?

If you ask these questions to a group of traders, you will likely get one of two types of answers. The first answer will be something about the indicators:

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InvestorEducation

Sunday, July 15, 2007

The Trading Doctor - Finding Your Trading Edge : Introduction / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

http://www.thetradingdoctor.com/updatesandalerts/images/7-11-07a.jpgThe heart and soul of trading is neurobehavioral. There is no way to deny this, as evidence continues to build that traders bring themselves and their brains into every aspect of trading. With this comes irrationality and neuropsychological biases.

The only way for a trader to succeed, i.e., perform in a consistently profitable fashion, is to have an edge. Those of you who have coached or mentored with me for any period of time will recognize immediately that I continually stress three critical elements of trading: risk control, money management and edge. What is an edge?

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InvestorEducation

Monday, July 09, 2007

Trading Doctor - The Trader As Hero / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

Courage is more exhilarating than fear, and in the long run it is easier. We do not have to become heroes overnight … just one step at a time, meeting each new thing that comes up, seeing it not as dreadful as it appears and discovering we have the strength to stare it down — Eleanor Roosevelt

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InvestorEducation

Thursday, April 19, 2007

Trading Wisdom - Trading is a game of Probabilities and not one of Certainties / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

One of the great evils of trading is false exactness...Trading is a fuzzy process and I mean fuzzy in the best sense of the word. That is, as in fuzzy logic, as in the willingness to accept the idea that things aren't exactly quantifiable and to forge ahead anyway....John Bollinger ( creator of the Bollinger Bands)

Trading is not about perfection. It is about probability and progress. All charts, analyses (fundamental and technical) and trading plans are built on probabilities.

Why then, do so many traders strive for perfection? Why do so many traders miss trades, waiting for exactly the right entry and then beat up on themselves when it doesn't come and the position runs away while they sit there scratching their heads and condemning themselves?

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Stock-Markets

Tuesday, April 17, 2007

A look at Stock Market Psychology / Stock-Markets / Trader Psychology

By: Clif_Droke

The past five days were bullish, overall, for the stock market. That isn't surprising given the level of bearish sentiment we saw in last week's AAII investor sentiment survey. This week's AAII poll, released Thursday, showed a slight increase in bullish sentiment (41%) over bearish sentiment (38%). That's not enough of a disparity between the bulls and the bears to cause any overt worries in the immediate term, but it's enough to slightly increase our caution.

The still rising dominant internal momentum indicator for the NYSE, the 200-day HILMO index, should act as a strong underlying support for anything unusual that gets thrown at this market in the coming weeks. The interim trend remains bullish.

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InvestorEducation

Monday, April 02, 2007

The Trading Doctor - A Broken Heart - Learn to Trade with Discipline / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

And in the end, it's not the years in your life that count. It's the life in your years... Abraham Lincoln

Today, I had to admit a 25-year-old trader to the hospital. He complained of crushing substernal chest pain and collapsed at his trading desk.He will survive this, most likely. However, it is pretty clear that he will never be the same. No one gets out of this type of situation unscathed. The trauma will pass, and the immediate stress will dissipate. The anxiety and the post-traumatic stress will be with him for years to come.

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InvestorEducation

Tuesday, March 27, 2007

Learning to Trade Financial Markets - Are you unbiased in your analysis of market direction ? / InvestorEducation / Trader Psychology

By: Marty_Chenard

A simple test to see if you look at the market in a non-biased way ...

One of the things that complicates are ability to read the market right is "non-objectivity".

Non objectivity is when we "have an opinion" of what the market will do and we subconsciously let that opinion tell us a different story of what the chart is telling us.

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InvestorEducation

Sunday, March 11, 2007

Trading Doctor - Trapped in Quicksand by Holding Losing Positions . - Cut your Losses Short ! / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

Take an old pair of jeans and cut a hole in one of the front pockets. Now, start pouring sand into that pocket. What happens? Sand runs down your leg and to the ground.   What do you do?  Keep pouring until the sand is up to your ankles? Your knees? Your waist?

At what point do you realize and act on the fact that no matter how much or how fast you pour sand into the empty pocket, you have a hole in your pocket? At what point do you come to the conclusion that you either have to stop pouring sand or just take off the pants and run away as fast as you can?

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InvestorEducation

Thursday, March 08, 2007

Trading Doctor - The Importance of Stress Control in Trading - The 'C' Word / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

Those who think they have no time for bodily exercise will sooner or later have to find time for illness...
Edward Stanley (14th Earl of Darby, 1799-1869)

The C word is not churn, candlesticks, commodities, contango, crash, curbs or any other Wall Street term that comes to mind. It's CORTISOL

Cortisol. an adrenal hormone, plays a critical role in the "normal" response to stress. By "normal" I mean "short-lived, fight or flight and it is over" type of stress. In this way, it is useful and protective to the body.

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InvestorEducation

Wednesday, March 07, 2007

Trading Doctor - When it All Falls Apart - Coping with Losses / InvestorEducation / Trader Psychology

By: Dr_Janice_Dorn

The worst lies are the lies we tell ourselves.
We live in denial of what we do, even what we think.
We do this because we're afraid…Richard Bach

Many years ago when I first started to trade, I went to a trading guru. In fact, I went to a several gurus. I asked them to help me, to teach me, to mentor me. Every one of them said "No", some more emphatically than others. The reasons they gave ranged from "I'm retiring soon" to "come back when you have a Ph.D. in losses and maybe we'll talk." In the interim, I got a Ph.D. in losses, but I never returned to any of them. Call it rejection sensitivity, call it stubbornness or call it whatever, I did not go back to the gurus. I learned the hard way.... by teaching myself. I made every possible mistake that a trader or investor can make, ranging from lousy stock picks to bad execution, not cutting losses, not letting profits run, not listening to the market.... and on and on.

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