have you not seen the charts i just posted?
Trading breakouts
- Thread starter gifropan
- Start date
have you not seen the charts i just posted?
You've fallen into the trap of the lump of gains fallacy, and the fallacy of the predetermined gain. You're ignoring opportunity costs.
Right. They illustrated "if you'd bot here, you would have made x". You failed to post all the charts where, if you'd bot there, you would have lost money.
The market is a "soft" science meaning that its largely built off assumptions. You cant attach some mathematical fallacy theory because its not going to hold up 100% of the time.
Maybe I should be more clear . . . Let's assume you knew both the direction and magnitude of the stocks future move, but you didn't know the path. In that case, you might try to increase your gains by holding out for a better price. Of course, you might miss out on some of the move if you don't get a better price . . . but that's the risk you take. In that scenario, you're trying to improve the price. So buying lower makes sense.
But in the real market, you don't know either the magnitude, direction, or path. So you have to choose the set-ups with the best expectancy. Those are the strong stocks. By buying lower, you're ignoring expectancy to improve price. That's the lump of gains fallacy -- but gains aren't predetermined, they're uncertain. And you're already imagining that the move is predetermined -- the fallacy of the predetermined move.
But in the real market, you don't know either the magnitude, direction, or path. So you have to choose the set-ups with the best expectancy. Those are the strong stocks. By buying lower, you're ignoring expectancy to improve price. That's the lump of gains fallacy -- but gains aren't predetermined, they're uncertain. And you're already imagining that the move is predetermined -- the fallacy of the predetermined move.
now that we took out the newb and hit their stop losses, we had a nice push today. Lets wait for the retrace for the next leg up.