RE:RE:RE:RE:RE:RE:WOW!rollindice wrote: Cognitive dissonance is a mental conflict that occurs when your beliefs don't line up with your actions. It's an uncomfortable state of mind when someone has contradictory values, attitudes, or perspectives about the same thing.
I lost my shirt when the Dotcom bubble burst. Months prior I saw myself sipping Margaritas on a beautiful beach forever ....just needed six more months of the climb.
When you loose that much money it causes the same chemical reaction in the brain as when a close loved one dies. I stopped trading all together and kept my day job.
5 Years later I met a very successful daytrader. VERY wealthy. I was watching her trade and she tells me watch this stock blow through $12. It did but she sold at $12. I said why they hell did you sell when you knew it was going to blow through $12? (biggest lesson I learned). She turned and looked at me like the terminator and said " I do this for a living". "I dont have any other job". I plan my trade and trade my plan.
She explained to me how to understand fear and greed and how to take emotion out of trading. How to overcome cognitive dissonance. Most valuable lesson I have learned.
I daytrade stocks and will only hold overnight those that I know are solid. I read the news releases before trading starts. Making money is about minimizing your loses. You can do everything right and the trade can go south on you. If you called it wrong get out. i use the 1 day minute chart. High volume liquid stocks, go in big, but small bites. Have confirmation it has turned solid green before entry.
I trade oil, gas, uranium, gold, silver, weed. There will always be a good trade for me everyday when you cover different commodities. Never go all in. Always have some dry powder to average down if you get caught.
Its not for everyone....in fact I really dont know many who can stomach it. But if you learn to understand fear and gread you can make this corrupt, manipulated market work for you. Thats just the tip of the iceburg really....but something to consider for those with the time, ability and willingness to learn.
Thanks for sharing I like hearing others stories and hopefully learn lessons from the sidelines instead of ending up in a blood bath.
I to had a similar experience with gold back in 2012. I made a pretty penny then held longer waiting for the big bonanza payout. Thinking I had it made I remember sitting at Chapters looking a expensive house magazines and exotic travel vacations. Then instead gold collapsed and I was left scratching my head wondering how so many "smart" people can be so so wrong including 'Billionaire' Eric Sprott, 'Mr Gold' Jim Sinclair and 'Babbling' Peter Schiff calling for 5-10K gold.
Lessons learned:
-If someone was right last time it just means they'll be wrong next time, and they only advertise their good calls not the 10 wrong calls.
-Never play on fundamentals (fun-for-mentals) only charts which is a real reflection of how the so called market feels.
Even world record holder Dan Zanger lost his shirt before the .coms came around and redeemed himself turning 10K into $18M in 2 years