December 14 (Thu): [Harmonic] Nikkei 225 vs 10-year US Treasury yield (Course: People Fear Change)
Good morning.
Today’s topic is that “people fear change.”
People dislike changing their current habits.
Why is that?
Because what we are accustomed to feels familiar and fits well inside us.
Even those who cannot continue to make money in trading
continue to incur losses because they trade within their own comfort zone.
When you trade according to your instincts, trading will continue to incur losses.
The basis for this is
‘Prospect Theory’
‘The majority is always wrong’
‘There is a path beyond the crowd and a mountain of flowers’
‘When ten people all lean in the same direction, you should never follow them’
and so on…
Trading proverbs already illustrate this.
What others are thinking, what the majority is thinking, and the actions they takedo the opposite of that.
How scary that is, and how hard it is to resist instinct?
However, if you cannot do that in trading, you will not easily achieve “consistent earnings.”
Taking this opportunity,
to look at the notion of “contrarian thinking”
please direct your attention to it.
When the market crashes, consider going long.
When news breaks, try selling against it.
Try buying beaten-down stocks.
That kind of perspective is necessary in trading!
Today I’d like to compare with the yield on 10-year U.S. Treasuries.
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These issues are occurring.
Therefore, for a while I plan not to use emoji or color in writing.
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