Why do many people still hold onto positions despite going against the trend?

Trying to catch the bottom and touch the top

Everyone thinks they are absolutely smart

It's a gamble on who will run out of breath first, themselves or the market trend.

Short-term profits in trading often create an illusion of defeating the market

Believing that recent smooth sailing or their own trading methods have triumphed over the market

At this very moment, losses occur, and it is often difficult to cut losses and admit mistakes

Because you do not want to break the illusion of having beaten the market accumulated from previous profits.

So, you hold onto positions, thinking about selling on a pullback, or even taking profits again

The market often slaps you hard, violently pulling in the opposite direction, pulling you to a point where you don’t want to face it, you regret not having cut losses earlier, and then you start to give up, not wanting to face it, even afraid to open the trading software

After avoiding for a while, you begin to calm down and are forced to admit losses and exit.

Holding onto a position once can erase all your previous profits, and most importantly, you lose the trading confidence accumulated from previous trades.

The main reasons for such situations are as follows:

1. Insufficient trading cognition,

2. Confusion in trading cycles, "Assuming you buy long in 5 minutes, one trade, loss.

You look at the daily chart and still see an uptrend, so you continue to hold.

3. Having a stroke of luck, fearing to miss out, you must have experienced holding onto positions, and when they rebound, sometimes even profiting, so this time you hope the market will give you your money back, just a temporary entry point error, the direction is correct. This often leads to the confusion of one's own trading system and believing in it.

3. How to avoid taking positions.

1. Adhere to your own trading system and risk management rules, what is the trading cycle, what is the entry point, what is the risk control point, what is the exit point.

What is the approximate profit?

Only when it is clear can it be operated, do not rely on feelings to open positions.

2. We must understand that you cannot have both fish and bear's paw, especially in trading, we must avoid the human weakness of wanting both.

Believe in the possibility of the diversity of trading methods.

We should not envy the profits made from a long-term trade while doing short-term trades.

Do not hold onto long-term positions while watching short-term fluctuations.

As long as we respect, believe in, and clarify our trading methods to gain profits within them, believing in the power of compound interest is enough.