There is no formula to predict the future
While walking to catch the train in time for the next〇〇 minutes, the moment I arrived on the platform the doors closed… I feel defeated.
When I try to outtalk my daughter with perfect logic and then exhaust all my cards, she replies “So what?”… clearly I’m losing.
You may think, “Isn’t that a win or loss?” (lol), but setting that aside, how do you evaluate winning or losing and how do you process your emotions?
We traders always act while imagining future prices. In short, we try to “predict.”
However, we don’t always get it right… in fact, any forecast can be right or wrong.
That’s why there’s a famous line in films: “Don’t predict. Just absorb the price movement.”
Rather than striving to be right, the practical and useful approach is to predict seriously, while recognizing that “prediction is only a trigger for action.”
Nevertheless, in reality, even seasoned professionals use colloquial expressions like “he’s right,” “he’s off,” and people say things like “That person is spot on,” quite normally.
I try to objectively observe whether my forecast and the price movement align at present, but I think one should not discard the part of one’s mind that sincerely wants to “be right.” After all, we’re not robots.
But there are things to watch out for.
While pursuing methods that include handling missteps and seeking improvements, there is a self that stretches beyond possible limits to “be right”—trying to understand that you don’t understand“metacognition”is important.
※Metacognition
To recognize one’s own thoughts and actions objectively.
The impulse to forcefully “be right” is something everyone experiences.
However, once you go beyond the proper level, you will definitely end up misdirected.
“I can’t predict myself. Therefore, I listen to experts.”
Even people with this attitude do not declare that they will follow experts verbatim. Everyone uses the expression “use as a reference.”
Since it’s your own money, it’s natural to decide for yourself. But it is inconsistent to judge whether an expert’s forecast will be right or wrong when the situation is “I can’t predict” and you’re in a state where you rely on the expert.
People think, “This person is right now. So, the next time they’ll be right too,” or search for who is right… they do things that don’t make sense.
RSI (Relative Strength Index) or MACD (Moving Average Convergence Divergence) are technical indicators.
If “right and wrong” is the premise, there is no need to debate their merits, but there are many people who use them devoutly without understanding their contents, inflating expectations.
Why use them without grasping why you decided “buy” and why you saw the answer as “sell”… this would be a failure as a result of serious thinking.
There are also cases where people use ready-made trading systems without knowing the fundamental approach, i.e., they rely on a “black box” without seeking rationale, and don’t realize this problem.
When you think again, the market has“sell” and “buy”only, so we should value a simpler mindset more.
■Stock Investment [Tiger’s Den] (Hayashi Investment Research Institute Channel)
On Friday, May 6, we uploaded the latest video.
Stock Investment [Tiger’s Den]
Stock Investment [Tiger’s Den] Taking Profit and Reversing Is Foolish
Gaining with price movement and taking profit, then aiming for the opposite movement and reversing—the stylish trades, but they are “foolish” and must be avoided. Why is that?And what is the correct response to profit-taking and reversing?
■YouTube Channel Market Scramble
Tonight, the latest video from Market Scramble will also be released.
Please watch at the URL below. Enjoy!
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