My personal perspective/reflection on Trading.

in trading •  5 years ago  (edited)

Trading to me is akin to systematically taking advantage of consecutive and perpetual biased coin flips (i.e. with 60-80% of falling heads more than tails, etc.), except that the "bias" of the coin is constantly shifting with time. When things are not going according to what is predicted, then it is time to reassess. Market does not behave in accord to anyone's personal preferences nor pride.

Technical analysis does not provide absolute answers (i.e. are not absolute predictions), and only attempts to assess probabilities base on historical confluences, that is all; and the act of trading is merely to attempt to siphon off price-gains more frequently than incurring losses, as the result of natural market volatility, and of course, with good risk management system (something that I certainly still need improving on -- i.e. to decide where to set stop-losses).

Without discipline and sensible risk management, then it is no longer trading, but gambling. A reminder posed to self.

Combating and training of the mind to avoid acting base on irrational emotions (fear and greed, overconfidence or loss of confidence due to profit/losses) is certainly difficult; and being disciplined and trading only strictly with tiny (mentally) manageable amounts at a time, regardless of the perceived opportunity, is really not easy as well.

Only trading with tiny amounts for now, and making/losing 10-100 a step at a time (over a half a day, or a week or more), may not sound exciting. But still it is good exercise of training of one's mind, and justification of getting a few "free" and nicer meals for the month with the small net gains, lol.

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