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An interesting question arises. If the markets can't be manipulated long term by the central banks of various countries with all their immense resources (financial, intellectual, and physical), can the markets ever be manipulated? The answer is that the markets can be manipulated only when there is no continuity of thought. Whenever the market is undecided, a large enough trader (individual, corporate, or government) can enter the market and bully the price up or down. It must be stressed that the reason this is possible is that the market is uncertain about future events. There is no continuity of thought. Whenever the market is exhibiting a certain continuity of (bullish or bearish) thought about where it is heading, no one can bully the market around. |
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Successful traders see price movements as an opportunity to buy low and sell high (or vice versa), or buy high and sell higher (or vice versa). Their goal is to perceive a pattern of some sort that will allow them to determine a value relative to a future point in time. A successful trader knows that the market is an entity that is never wrong, and exists to provide participants with a way to profit. An outstanding trader is striving to consistently make profits over a series of trades. Although a particular trade in a particular market will be unpredictable, when considered in the aggregate, certain probabilities in favor of a trader with an "edge" may be established that will allow consistent profitability. |
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Now to answer the previous question. Successful traders will in most cases experience no negative emotions when they place a trade that results in a loss. Even after consecutive losing trades, they will continue to experience no negative emotions! Why? Because successful traders believe that the market is always correct at this exact instant of time; and if the last trade resulted in a loss, then one of two things are transpiring in the marketplace. First, the market is changing direction. While the trader's perception is indicating that the market is heading in one direction, the market is actually going in the opposite direction, resulting in the loss. In other words, if the trader perceives that the market is heading down and experiences a loss from being short, the market is indicating that the perception is wrong. Second, the market is not certain where it is heading, there is no continuity of thought, and there is a battle under way between the bears and the bullswith the resultant increase in volatility and resultant loss. |
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The reason successful traders do not get angry, fearful, and resentful about their loss is that they have mastered the virtues and beliefs that trading demands. They represent the market in a way that allows them to define the market action, and their own action, in a very clear and precise manner. |
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