14. If only I’d bought here or there…

All leeks have a fantasy. Every day, or even every moment, they are staring at the %K lines. This idea often appears in their minds:

Argh! If only I had sold there (looking at a high price point) and then bought here (moving their gaze to a low price point)!

I don’t know about you, but I certainly had this type of fantasy when I first started. Later, after observation, I guess that every novice has had this type of fantasy.

As to why it is a fantasy, you can tell by this phrase:

If only…

This is the most typical phrase that people use when they want to shake off awkwardness. The reality is that you can’t change the past, but leeks still can’t help fantasizing, and thinking that things would be better if only the past were this way or that way.

It’s hard for novices to avoid this type of fantasizing, but old leeks are chronically childish.

You can tell by listening to them describe a “market manipulator” (this is quite possibly their fantasizing):

“Li Xiaolai sold all of his EOS and cashed out at 32 RMB, and then when the market price went down to 6 RMB he bought it all back… Just like this, in a few days Li Xiaolai got more than 5x returns!” (This is from a news report in mid-August 2017)

32 RMB was the highest price point for EOS at that time, and 6 RMB was the lowest price point. Li Xiaolai is really amazing! He could predict in advance the highest point and “sell everything”! Not only that, he quickly predicted the lowest point and at that point “bought it all back”!

This is an astonishing series of events. It’s okay for novices to not understand, but are old leeks still this way? At any point in time there is a price in the market, but along with this price there is also a “trading volume at that price”. This is very important!

Calm down a bit, take a look at the K line and you’ll understand. At that time there was very little trading volume at the price of 32 RMB. Actually, at any “highest point” or “lowest point” the trading volume is very low! At the highest price point, you can only sell a small amount. If you keep selling, then you need to sell at a lower price… Conversely, at the lowest price point, you can only buy a small amount. If you keep buying, then you need to buy at a higher price…

This is just how leeks are: every now and then they need to use fantasies to console themselves about their past. And then they can’t help using those same fantasies to explain things that are currently happening. They have no idea that these are things that are actually completely impossible.

It’s still the same mechanism:

They think that they are playing a zero-sum game, so if they lose money someone else must have earned it… As far as who “earned” it, they don’t know that that “who” only exists in their fantasy, so it must be a “real person”. Who is it? It can only be that “person who they already know made money”… So they naturally take Li Xiaolai to be that person. Yes! It can only be Li Xiaolai.

As you gradually improve, and leave that road that destines you to become a leek, you will naturally understand:

As a participant in trading markets, it’s not very likely that you will sell at the highest point, and it’s difficult to buy at the lowest point.

Why? The reason is quite clear and simple:

The highest and lowest points are caused by the impulsiveness of a small portion of traders.

You are destined to become a non-impulsive person, so those impulsive trades are destined to not belong to the non-impulsive you!

Believe me, you are a normal person, so it’s very normal for you to have fantasies from time to time. However, you are different. How are you different? You are different in that when you have a fantasy to can recognize the fantasy and clearly know that it is a fantasy. So you can be like a normal person and shake your head furiously, shaking off the fantasy and continuing your normal life and normal thoughts…