The market Heard is humane in nature and ignoring the Heard is more profitable. I often wonder why people are paranoid about scenario that has low probability of occurrence, but engulf themselves in events which has a high probability of happening. like being scared to fly on an air plane but ride a bike without a Helmet or driving a car without a seat belt
Greed and fear are the worst enemies of an investor, we all posses these traits in different proportion. But if you don’t know when to be greedy or when to be fearful, your money will in no time gradually become a Mirage. its a known fact that 80% of trader lose money.
“Be fearful when others are greedy and be greedy when others are fearful”
what the above quote is trying to say in a nutshell is that, when the market is bombarded with some green candles and every body is going long, this is where you need to be cautions. and when the market is in Red, this is a high time to pick up some coins at a discounted price. Many people knows about this principle but it’s easier said than done.
Take a step back and take a snapshot of your past failed trades, what if you had done exactly opposite of what you did? what if you had gone short instead of going long?
Greed will make you size your loot too high, and also make you use insane leverage which will only ends up subjecting your account to margin call if the market goes south.
Fear will make you add to your loosing position with the hope of maximizing your earnings. doing this will make you close your trades in loss when price keeps on going south.
In trading or investing, your decisions should not be a function of how the market turns out. you must plan your entry and exit before entering into any trade. If you don’t do this, you might ends up making emotional and unscrupulous decisions which i’m afraid may hurt your trading account.
Fear and Greed does not only apply to trading but all aspect of life. for instance while people are greedy taking Credit cards and car loans, this is when you should be fearful. and when others are fearful in taking risk, change and opportunity in life, this is when you should be greedy .
Never operate on the mindset of scarcity and desperation. Some people see life as a zero-sum game such that there is not enough to go around , thereby they think if they are winning, another person has to be losing. So when opportunities comes their way, they keep it to themselves. The universe has a way of rewarding those who has a scarcity mindset with more scarcity. Scarcity mindset is the major reason why some people remain poor. A small change in mindset has the propensity of changing a lot of peoples life.
thank you for reading best regards @sulexbaronYour Remaining Votes (within 24hrs) : 10 of 10