Trader Diagnosis’ Latest Thoughts

Here are some of the things I’ve been thinking about:

The two areas in trading that separate the men from the boys (so to speak) are:

1.) The ability to divide environmental perceptions in half and process them separately. First I ask myself what I am feeling and in doing so I acknowledge and honor the feelings […]

“Emotional arousal” is not something to avoid, but to master. By Elise Payzan Le Nestour

All this suggests that emotions are key information providers when deciding under uncertainty. They make us tuned to our environment. Actually, in some contexts of fast and intuitive decision-making in the face of unstable (high vol) conditions, one expects that the stronger the emotional uncertainty signals of the day-trader, the higher the performance.

By |October 20th, 2009|Emotions & Decisions, French PhD Chick, Risk Decisions, Worth Reading|2 Comments

Trader W Strikes Again!

Reading your work, applying it, monitoring myself, writing down my feelings, is really paying off. I am trading less, and making more money. This week and last week have been incredible.

By |April 8th, 2009|Emotion Analytics, Learning Psych Cap|6 Comments

PERCEPTION – It’s Not Rocket Surgery… to borrow a great line

Bear markets mean lower lows and lower highs ... and we are in a bear market until we get higher lows. and higher highs ... which is decidedly NOT today.

By |March 2nd, 2009|Markets|0 Comments

Sullenberger “Fear mixed with Focus”

I have said it before and will say it again, FDR was wrong. It is not that the only thing we have to fear is fear itself, the only thing we have to fear is no fear at all.

By |February 9th, 2009|Emotions & Decisions, Learning Psych Cap|4 Comments

Fraud & Fear: Weekend Papers report on Facts & Feelings

WSJ Weekend: “Fund Fraud Hits Big Names”. New York Times Sunday Business: Schiller talks confidence and beliefs and Ben Stein talks fear.

Madoff’s investors “felt confident” in his long-time consistent returns. Yet every article indicates there were multiple red flags. No investment fees? Not even a 1% management fee when most charge 2%? As Joe Aaron […]

By |December 14th, 2008|Learning Psych Cap, Markets|16 Comments

Panics, Limit-Down and Windows…

What do our brains do when a down-trend becomes an avalanche – when
some snow gets rolling at the top and picks up steam and snow and speed
until it hits bottom – with no regard for anything in its way?

Two things to know –

First, it tends to assume it will get the same result from the […]

By |October 24th, 2008|Emotions & Decisions, Markets|10 Comments

Deep Breaths, No TV and Calm

The WSJ’s Intelligent Investor …

The weekend edition of the WSJ included Zweig’s column on fighting the herd mentality. In many ways it is good article… but it does what all articles and commentary seem to do… in the end it says “get rational”. The problem with this is when you feel terrified it is extremely […]

By |October 20th, 2008|Comfort Food, Emotions & Decisions|4 Comments

Who’s on third?

It is all too easy to forget the underlying mechanics of price movement. Price chops around in a small range (remember when it did that) when very few buyers/sellers (PEOPLE) have any real conviction (FEELING) or need (MOTIVATED = feeling) to buy or sell.

On the other hand, price moves directionally when many buyers or sellers […]

By |October 17th, 2008|Definitions, Emotions & Decisions, Markets|26 Comments

FEAR in capital letters

At this point, it goes without saying – the entire world is gripped in fear. .. and for good reason. Forgive me for disagreeing with FDR but it isn’t that “the only thing we have to fear is fear itself” but “the only thing we have to fear is acting on our fear AT THE […]

By |October 8th, 2008|Emotions & Decisions, Markets, Uncategorized|2 Comments