Gieno Trading Pyramid - Commitment |
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To many traders the market is a generator of random sequences. In many cases it will drive you round the bend. Commitment is a very necessary quality if you are going to be a winner.
Markets are a manifestation of human psychology. They are driven by fear and greed. Peaks are driven by greed, troughs by fear. This is obvious in the very long-term extremes. Fear is often illustrated, literally, with blood in the street. Greed is so endemic nobody recognizes it for what it is. But stand aside and it becomes obvious. Not so obvious in the shorter term moves, but still there. At the extremes the key point is that price is stretched unrealistically. Why is this? Because traders and/or investors are paying too much, selling too cheaply, because it is an emotional decision. To win you must put yourself outside that emotion. Different ways of looking at market action all serve to highlight someinformation; whilst minimizing or eliminating other elements. Market Profile and Minus Development are ways of looking at the marketwhich have some meaning and may, therefore, prove more usefulthan other techniques. If it is not obvious whysomething should work, itprobably doesn’t! The market is designed to generate trade and maximize it. This is afundamental fact it is always well to remember.
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