As I have been writing publicly for over 13 years, and have been running my services for and teaching trading and investing to thousands of retail customers and money manager clients for the same, I have learned a lot about how most of you approach the market. More importantly, I have learned what most of you do wrong, as the mistakes made by most seem to be quite universal and ubiquitous.
The problem is based upon the fact that narratives are quite convincing, yet are often wrong. And, reliance upon such reasoned narratives often leads to large losses in the market. Therefore, once you buy into a narrative, it is quite unlikely that you will be able to extricate yourself from your position if it turns the wrong way.I have always said that “hope” is the most dangerous four-letter word in the English language for an investor or trader. I have seen this thousands of times in my career and it is one of the worst habits investors display.
For this reason, I have advised the thousands of investors and traders we have taught through the years that you must have an objective plan in place before you enter the trade or investment. You must know where your ideal entry is, where you intend to take profits, and where you exit with a small loss because you are wrong in your assessment. And, we develop these price levels at The Market Pinball Wizard through the use of Fibonacci mathematics.
Therefore, another piece of advice I have given to all those that enter the virtual doors of our services is to make sure you identify the type of trader/investor you are, and the timeframe which suits you best.