#sats #ordi #sol #btc #eth

A common tendency of human nature when facing risks and opportunities:

Loss aversion:

People generally react more strongly to losses than to gains.

This results in investing, where when asset prices fall, players are often more likely to panic and rush to sell to avoid further losses, even though doing so may be irrational.

Conversely, when markets are at highs, greed may take over, pushing players to continue buying even though the risk has increased significantly.

Herd mentality (herding effect):

People tend to imitate the behavior of others, especially in uncertain or high-risk environments.

When you see other people making profits by buying, you will follow the trend and buy even if there is no sufficient reason or analysis; similarly, when market panic spreads, you will also follow the crowd to sell.

The importance of reverse thinking:

Reverse thinking requires players to look for opportunities when most people choose to escape, and to stay calm when most people are crazy. This way of thinking requires deep market analysis capabilities and strong psychological quality, and the ability to think independently and not follow the crowd. In the financial market, players who can use contrarian thinking and execute successfully can often achieve market-beating returns.

It should be noted that reverse thinking is not the same as blindly doing the opposite. It needs to be based on adequate market analysis, risk assessment and personal investment strategies.

At the same time, players also need to have enough patience and perseverance, because reverse investment often takes a long time to verify its correctness.

Certain weaknesses in human nature are magnified in the financial market. Through learning and practice, these weaknesses can be gradually overcome and a more rational and mature mentality can be developed.