A fulcrum point is a key point at which a trade or investment decision must be made. It is the point at which the potential risks and rewards of the decision are most evenly balanced. A fulcrum point can be seen as a turning point, after which the decision-maker is committed to a particular course … Read more
The term “hammering by stock traders” refers to the aggressive selling of a security by traders in order to drive the price down. This is often done in order to create a panic among investors, which can then be exploited by the traders. The term can also refer to the act of traders bidding up … Read more
The media effect refers to the way the mass media can influence the way we think, feel, and behave. The media can have a positive or negative effect on our trading psychology. For example, if we see a news story about a stock that has lost a lot of value, we may be less likely … Read more
Behavioral finance is a relatively new field that combines psychology and economics to better understand why people make the financial decisions they do. The principles of behavioral finance can be used to help explain why people make the same financial mistakes over and over, why they tend to buy high and sell low, and why … Read more
When trading, it is important to let your profits run in order to maximize your gains. This means that once you have entered into a trade and the market starts moving in your favor, you should hold onto your position until the trend reverses or reaches a point where you determine that it is no … Read more
The term “scale in” refers to the act of adding to a position that is already in profit. This is done in an attempt to increase the size of the overall position and therefore the potential profits. Scaling in can be a useful strategy in certain situations, such as when the market is showing signs … Read more
Anchoring is a cognitive bias that refers to the tendency to rely too heavily on the first piece of information that we receive when making decisions. This can lead to bad decision-making, as we may not take into account all of the relevant information when making our choice. For example, let’s say you are trying … Read more
A cutoff point is the point at which a trader decides to take action on a trade. This could be the point at which the trader enters a trade, or it could be the point at which the trader decides to exit a trade. A cutoff point is typically based on a technical analysis of … Read more
