Category: Money tips Release Date: 2007-08-02
Traders had to face one of the many psychological problems, with right or wrong terms, are the two basic human emotions, that is the hope and fear of potential conflicts.
A trader following the main (bullish) trend to buy soybean futures, has a high book profits. But he rebounded when first sold, and he was afraid if it continues to hold long positions while the reverse bearish market, so would lose their profits.
Trader B, on the other hand, regardless of the main (bullish) trend in soybean futures have little short, but the book may increase the loss. He may hold positions in the loss of a book, hoping the market will reverse its major bull trend (and probably do not need to reverse, but at least he and the others like him insist on short time, began to bearish market conditions). In his hopeful at the same time, the market continued its bullish trend in major loss of his continued to increase.
We all experienced the hope and fear, the two main emotions, but exactly the wrong direction 180 degrees. Holders of long positions with a book profit of the trader A should stick to their positions, hoping in his favor of the stock market movements will be further changes in the same direction, increasing their profits. On the other hand, for non-profitable positions held by anti-trend traders B, he should be afraid of the going-rate disadvantage will continue (also often be true) while the losses will continue to increase (which also often occur). Going-rate and weather there are many similarities, which is how is how, people could not do anything. Or, as Mark Twain once said: "Everyone is talking about the weather, but nobody has to do something about." Therefore, if the weather looks like rain, whether you like it or not, you have to wear to bring an umbrella on a rain coat, because the weather is like that. Similarly, if the market trend bearish, you short, or stand on one side; if the trend bullish, you buy or standing on the side - because you can not afford to change the basic trend of the market direction. You or chase city, or victims of trying to buck the trend to do various types of losses.
Sometimes occur following circumstances. When the market trend is down, you hold long positions, but you try to eventually make money. Alternatively, the market trend bullish, you hold long positions, but in the end you have suffered a loss. Whether these experiences are referred to repeatedly chase city's strategy for conflict? Not at all. There will be exceptions to every rule, examples of those transactions, namely, contrarian and do make money, or they lose money chasing potential, but only a few examples of exceptional circumstances only. Likewise, you may have seen some golfers hands and Chi Gun in the wrong direction but can the ball gently into the hole. Is That means the that is to play golf there an alternative? Is not the case. This only succeeded once, but if he tried to remain within a certain period of time to play golf with this gimmick, the results will no doubt be another case. When the transaction results deteriorate, the only people will become frustrated. While your intentions good, but you try to use an objective way of binding transaction, but most deal has suffered a loss. We, including myself, have had such a situation. I have found that in this period, the best strategy is to clear all positions, away from the market until you make your mind clear, make your attitude more certain. You can be sure that when you go back to the market to take action, it is time. Reminds me of the迪克森瓦特talked of a story (Dixon is the 19th century, a well-known veteran of the cotton dealer), when a huge claim to their positions held by traders him awake at night to watts Qiujiao when he made a proposal to the point: "the position to sell to your perception of the level of sleep peacefully." now this is still a good idea.
