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Greed and fear

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Since trading depends on the changing perceived value of a stock, your trading time frame should be chosen based on how well you are able detach yourself from the emotions of greed and fear.

 


Trading can, for many market participants, be affected by impulsiveness, greed and fear. Traders may decide to abandon a long-term strategy in favour of short-term trading in response to a bull or bear market.

References
Shefrin, Hersh (2002) Beyond Greed and Fear: Understanding behavioral finance and the psychology of investing. Oxford Universtity Press ...

Fundamentally, technical analysis shows in graphic form investor sentiment, both greed and fear. Understanding that concept is key to understanding technical analysis and being able to use it effectively to trade securities.

and the subsequent economic recession were the direct consequence of serious ethical failures. Banks lent money that they didn't have to borrowers who wanted goods and services they couldn't afford or didn't actually need. Human greed and fear were ...

See also: Technical Analysis, Saving, Day trade, Smith, Risk management

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