"What is WORSE for you?" asked Gemma.

OPTION 1 "Investing in a stock and losing heavily...?"

OPTION 2 "NOT investing in a stock and missing out on a huge profit...?"

Both of Gemma's options are borne out of out of
the emotions of "HOPE, GREED and FEAR", which may
be the result of our trading EGO .....

OPTION 1 .....

EGO has a FEAR of being proven wrong,
so we must go through the pain of holding
through heavy losses, until stock recovers
..... sometimes years later.


OPTION 2 .....

EGO responds to the FEAR of missing a
good trade, so the trader's response will
be to enter a trade on a whim, without
proper research or analysis.


..... are you trading the markets or emotions?

-----

Below is an extract about trading emotions,
taken from one of my previous books, on
developing your own trading plan:


Here's a discussion on HOPE and FEAR - just
two of the emotions to affect traders, daily.

Hope & Fear?

Posted by Noone on Sunday, 5 March 2000, at 4:31 p.m.

We all hear that hope & fear control the markets?

1. Can anyone explain one or both?

2. Can either one be seen on a chart?

3. Can either one be explained enough, to be able to write an indicator etc. to be shown on a chart,
that will help in trading?

4. If it can be seen, is it too late to use, or would it be helpful to a trader?

Anyone have any ideas or explanations of Hope or Fear as far as trading?

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Posted by Yogi-in-Oz on 06 March, 2000 at 18:58:06:

Hi Noone,

Not sure where you are going with this, but here goes:

1. HOPE is entering a market without a trading plan.

HOPE is holding a position after it has blown through your stop (if you had one).

HOPE is holding that 3-day trade for 3 months or more.

HOPE is watching a market approaching your PRICE STOP, long after your TIME STOP has expired.

FEAR of loss is not pulling the trigger, when your system posts an entry signal.

FEAR of getting out too early is not pulling the trigger, when your system posts an exit signal.

FEAR of missing a trade is being in a market before your entry signals have been confirmed.

HOPE and FEAR are two of ten emotional words that should never be part of a trader's vocabulary.

GREED, EGO, "Coulda, woulda & shoulda" being 5 other negative trading words.

2. HOPE & FEAR can always be seen on the chart of any market - it's called the PRICE.

3. If we represent traders' emotions
(HOPE & FEAR being just two emotions) in an indicator,
then that indicator would need to accurately reflect the
variations in such emotions. This is measured by the
Law of Vibration and the Law of Resonance, both of which
are reflected in PRICE, so no need to write a
new indicator - just use the one you have more effectively.

4. PRICE (a measure of traders' emotions) can easily be
seen and is never too late to use, in a well-laid trading plan,
which is most helpful to all traders.

Control your emotions (including HOPE & FEAR) and
become a better trader.

-----

happy trading in 2004

yogi

_ _ _ _
_________________
"Time and knowledge, our scarcest resources." - yogi

http://groups.yahoo.com/group/starcode_traders