I know people with way more than 10 years of experience who didn't buy that low. Personally, at that point, I was also convinced we were in corrrection mode and had more downside (before resuming higher). The key is of course to quickly change gears when it's apparent you're wrong. Keep losses small and winners bigger. In the end, that's honestly what it's all about. If you can't contain your losses or manage your risk while taking home larger winners you're dead. Now, what surprises me is that there are people who still are in disbelief about the bullish nature of the US indices. Surely, anyone's who's been around for a few years have seen it all by now.
Yes and what just baffles me, is that these people - myself included - seem to keep having the same 'atraction' to the downside. Is it the 'smarter then the majority'-thingy or 'long is boring' thingy? I realise this is going to sound overly and overly simplistic and naive, but it seems that fighting this lizard brain thing is very hard to overcome. In the same venure that losing weight is simplistic in nature, but very hard to do for everyone/ a lot of people. Alas, I'm just referring to the steenbarger/douglas section
@v-shape-0DTE Did you ever looked at how much you made if you really went long after that little dip, and containing losses with eg a spread?
Actually, it's more to do with mean reversion. Historically, we do see the market pull back after an extended run. And I don't mean a full-fledged reversal (eg. bear market) but a decent pullback to what's perceived as "fair value", whatever that means.
Well, don't be looking at me now. I might be stupid but not that stupid. If you don't already know, my middle name is "turncoat". And I'm selling my arms and legs to go LONG.
Some people just want to be right and prove everybody else how smart they are. I'm not saying I'm not one of those people
Problem is, there is both evidence for mean reversion and momentum. I think I will definetly stick to only long, be it mean reversion or momentum. It’s just where the odds are. Like @Overnight, a YouTube fragment:
Well, it's easy to say that now that we're at ATH, but could you have said the same just 4 weeks ago when NQ made over 8% correction? We can all be overoptimistic when the market is rallying or overpessimistic when the market is tanking. But that's where the real test lies. Anyway, good luck to everyone all the same. After all, we do all share one thing in common: to make money (or at least not to lose what we have).