I made lot of mistake last week before the national election (Philippines), actually the first automated election conducted on my country. I'd dispose all my holdings on my portfolio and decided to be a watcher on the whole action on market trends, where I let all the opportunities passing on my sloppy hands. It’s not only me, but also lot of fund managers made an escape route out on the market on that week on presuming that the result will only be chaos.

But after seeing a good results yesterday, May 11, 2010 market bounced at range 120 points. As expected, all that sold their shares last week even on losing position is now the one pumping up the prices. I myself are ready to be on the arena back again, I’ll just wait for good entry.

Investing emotions is very simple cycle to understand, but it’s really hard to follow unless you’re a truly robotic or emotionless trader. They say that understanding the investing emotion cycle is the basic skill of a technical trader must know. A very basic indeed but none have mastered yet, because we’re human. On this point, all we need to stand is have guidance from this chart, remember what Jesse Livermore says: “The market is always right.” And what Warren Buffet mentioned, “Be greedy when the others are fearful and be fearful when others are greedy. “


Investing Emotion Cycle
 

It’s all in our mindset, we should be a target oriented or be contended on our goal to avoid greed. Every day hurtles through profusion of different events, judged by millions of mindsets, producing a unique mixture of consequences. Greed is only excess because we’re not being happy on what we've gained, and panic is there when we’ve seen that we’re losing our gains and most speculators are going out.

My mistake last week is a very good lesson on me; I forgot to check back my charts for price supports and easily panicked.

We cannot control global or even local events, or the stock market, or the behavior of those around us. We can, however, command our own thoughts. The minute we affirm and know that we have within us the potential to prosper and succeed in all areas of our lives, creative ideas, resourcefulness, and opportunities will abound. Only then can we claim our legacy of prosperity and abundance!


For fun learning purposes, let's assumed next time when we’ll study the price charts, come to think of ourselves as a psychologist. The stock is our "patient," and we are the "doctor" whose job it is to analyze the stock's good points and trouble-causing characteristics. When we learn to look at a chart with a trained, discerning eye, it won't take long before we'll identify at judging the risk/reward, and thus money-making possibilities of any stock you choose.