There are two major emotions that rule the market.
One is fear.
The other is greed.
Both of these emotions, if not mastered, can destroy profit.
Fear comes into play when bad news causes inexperienced traders to bail out of their positions at any price.
Greed was rampant during the dot.com bubble in the 90’s. Untrained traders were blindly buying up internet stocks as they headed higher and higher, only to see their fortunes soon come crashing down.
A great trader is one that has learned to temper his emotions and use objective criteria, not emotion, to make his trading decisions.
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