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MARKEY CYCLES PSYCHOLOGY | EMOTIONS & COGNITIVE BIASES All markets go through cycles of expansion and contraction. 📈When a market is in an expansion phase (an uptrend), there is a sentiment of optimism, belief, and greed. Typically, these are the main emotions that lead to a strong buying activity. Sometimes, a strong sense of greed and belief overtakes the market in such a way that a financial bubble can form. In such a scenario, many investors become irrational, losing sight of the actual value and buying an asset only because they believe the market will continue to rise. They get greedy and irrational by the impressive bullish movement, expecting to make huge profits. As the market gets heavily overbought, the local top is created. In general, this is considered to be the point of the highest risk. In some cases, the market will start a sideways movement while smart money steadily sells the asset. This is also called the distribution stage . However, some markets don't present a clear distribution stage, and the downtrend starts sharply after the top is reached. ➖➖➖➖➖➖➖➖➖ 📉 When the market starts reversing, the euphoric mood can quickly turn into complacency , as many traders refuse to admit that the uptrend came to an end. As prices continue to fall, the market sentiment quickly moves to the bearish side . It often includes feelings of anxiety, denial, and panic . In this context, by the anxiety we mean the moment when bullish biased market participants start to question why the price is falling, which soon leads to the denial stage . The denial period is marked by a sense of unacceptance. Many investors keep holding their losing positions, either because "it's too late to sell" or because they want still believe that "the market will come back soon." But as the prices drop even lower, the selling wave gets stronger. At this point, fear and panic often lead to what is called a market capitulation (when holders give up and sell their assets close to the local bottom). Eventually, the downtrend stops as the volatility decreases and the market stabilizes. Typically, the market experiences sideways movements before feelings of hope and optimism start arising again. Such a sideways period is called the accumulation stage . ❤️ Please, support this idea with a like and comment! ❤️ ⬇️ Subscribe to my social networks! ⬇️
OANDA:XAUUSDEducation
by VasilyTrader
16
⭐ STAGES OF TRADER's FORMING ⭐Hello! Traders professional growth involves going through several stages. Let's talk more about them. 🔥1. Unconscious incompetence 💡 randomly opens and completes transactions without a specific trading system; 💡 doesn't care about risk management; 💡 often changes the direction of trade on the spot, following the price; 💡 keeps afloat only for small successful deals and doesn't care about losses at all; 💡 but as soon as loses, motivation immediately runs out. 🔥 2. Conscious incompetence 💡 Do you change your trading system several times in half a year without ever exploring a single one? 💡 You are actively looking at your trading history trying to figure out what you are doing wrong. 💡 Are you still making impulsive mistakes that cost a lot of money? 💡 Do you repeat the same trading mistakes again and again? 🔥3. The moment of "EURECA" 💡 No longer changes the system, but focuses on main and works with it. 💡 Begins to maintain a trading plan and a trading journal. 💡 The understanding comes, that trade is a daily routine. 💡 Understands, that in order to earn money, he needs to work on all the components of his system. 🔥 4. Conscious competence 💡 Understood the rules of the game and stopped losing money. 💡 Begins to make a steady profit. 🔥5. Unconscious competence That's a stage of mastery👊🏻. You follow your trading plan on autopilot.✈ Just one question will help you to verify have you reached the highest level or not: ❗do you feel stress, when you're trading ? If so, then you have not reached this stage.❗ Thank you for staying with me💋 Always sincere with You🧡 Your Rocket Bomb🚀💣
BITSTAMP:BTCUSDEducation
by RocketBomb
29
⭐ STAGES OF TRADER's FORMING ⭐ Hello, friends, today we are talking about STAGES OF TRADER's FORMING 👊🏻👊🏻 💡() - Link for good view!!! Professional growth involves going through several stages. 🔥 1. Unconscious incompetence 💡 randomly opens and completes transactions without a specific trading system; 💡 doesn't care about risk management; 💡 often changes the direction of trade on the spot, following the price; 💡 keeps afloat only for small successful deals and doesn't care about losses at all; 💡 but as soon as loses, motivation immediately runs out. 🔥 2. Conscious incompetence 💡 Do you change your trading system several times in half a year without ever exploring a single one? 💡 You are actively looking at your trading history trying to figure out what you are doing wrong. 💡 Are you still making impulsive mistakes that cost a lot of money? 💡 Do you repeat the same trading mistakes again and again? 🔥 3. The moment of "EURECA" 💡 No longer changes the system, but focuses on main and works with it. 💡 Begins to maintain a trading plan and a trading journal. 💡 The understanding comes, that trade is a daily routine. 💡 Understands, that in order to earn money, he needs to work on all the components of his system. 🔥 4. Conscious competence 💡 Understood the rules of the game and stopped losing money. 💡 Begins to make a steady profit. 🔥 5. Unconscious competence That's a stage of mastery 👊🏻. You follow your trading plan on autopilot.✈ Just one question will help you to verify have you reached the highest level or not: ❗do you feel stress, when you're trading ? If so, then you have not reached this stage.❗ 💡() - Link for good view!!! ✍🏻If you liked my post, put me like, write comments, reviews ... Guys, I'm so happy with your message in PM about your love for me. 😍For me it is priceless!😍 I'll try for you continue to be useful!!! 😘 Together we're a great team !!!👊🏻👊🏻 Always Your Rocket Bomb🚀💣
BITSTAMP:BTCUSDEducation
by RocketBomb
53
⚡Trader's psychological stages in the market⚡👋🏻👋🏻👋🏻Hello, dear dear friends! 💓 Today I would like to share with you ⚡ Trader's psychological stages in the market ⚡ 💥 OPTIMISM. It all starts with a positive outlook on the market situation, which leads the trader to open a deal. Trader in anticipation of future success. 💥EXCITATION. The market begins to move in the predicted direction. The trader anticipates events and hopes that success is ensured. 💥TREMBLING. The market continues to move in the direction the trader needs, this is a moment of joyful fading. At this stage, the trader is fully confident in his trading system. 💥EUPHORIA. Point of maximum financial risk. Investments turn into quick and easy returns. Trader completely ignores risk. 💥ANXIETY. Oh no, the market is turning around! The first signs of movement appear not in favor of the trader. But he does not notice this and believes that the market will recover and the trend will continue. 💥NEGATION. The expected market recovery did not happen. The trader does not accept what is happening and remains in position. 💥FEAR. Reality dictates its own rules, and the trader begins to realize that he is not as smart as he previously thought. Instead of confidence in success, thoughts begin to get confused. 💥HOPELESSNESS. At this point, all profits are lost. The trader had a chance to take profits, but he missed it. Not knowing how to proceed further, he is trying to do everything to return at least to the breakeven point. 💥PANIC. The most emotional period. At this stage, the trader feels his ignorance and helplessness and is wholly in the grip of the market. The mind is paralyzed, which sometimes leads to meaningless actions in the market. 💥CAPITULATION. The trader has reached the limit of patience and closes the position so as not to increase losses anymore. 💥DISAPPOINTED. After exiting the market, the trader no longer has the slightest desire to enter into transactions. 💥DEPRESSION. The trader begins to blame himself for the stupidity of why he did not close the deal on time. Some choose the right path and begin to analyze what went wrong. Real traders are born precisely at this stage, studying past mistakes and drawing conclusions. 💥HOPE. “I can still do it!” In the end, the trader returns to the realization that there really are cycles in the market. He begins to analyze new opportunities. 💥FAITH. At this stage, the trader restores faith in his future in the market and starts trading again. The stages considered by us well demonstrate how psychology influences trading. 80% of success in the market directly depends on the correct psychological state of the trader. 😉😉And at what stage are you now?🧐 Share in the comments✍🏻 Stay with me💋 Your Rocket Bomb🚀💣 Other my psychological idea👇🏻👇🏻👇🏻
BITSTAMP:BTCUSDEducation
by RocketBomb
33