Dear Trader, If you’re reading this, chances are you’ve purchased a stock trading course before - or at least thought about it seriously. But something’s not quite clicking. Maybe you’ve followed courses that promised "quick profits" only to find yourself second-guessing every trade. Maybe you've been glued to the charts, making impulsive decisions, or stuck in analysis paralysis. The truth?...
Learning how to start stock trading can be one of the most rewarding ways to build personal wealth. However, the journey from curious beginner to confident trader is often filled with potential missteps, conflicting advice, and overwhelming information. Without a clear, structured system in place, it’s easy to get lost in the noise and end up making costly mistakes. But with the right guidance...
Let’s get real for a minute. You’ve got your trading strategy, your backtest results look solid, your rules are locked in. On paper, everything checks out. But then, out of nowhere, you hesitate on a perfectly valid trade. You skip an entry. You downsize a position. You start second-guessing your system. Sound familiar? That’s not a strategy issue. That’s a mental drawdown—and it can quietly...
In this week's Enlightened Stock Trading newsletter we cover: 📈Stock Market Update: What happened in the markets this week ⁉️Scenarios: What could happen next & what to do about it 🧠Trading Psychology: You don't belong here... and the lies we tell ourselves 💰Kelly Criterion: Is it a trading elixir or disease? 🎓Learning to trade: How to pick the right trading course for you 🧠Trading Tip:...
I have four things for you this week: A very interesting market update given the turmoil in the markets this week A psychological bias that is super common and really hurts traders Position sizing tip to keep you in the game How to think about stop losses to improve your performance Let’s jump in...Stock Market Update for 15 March 2025This week was certainly not the most fun long side traders...
Loss aversion is a psychological bias where the pain of losing feels much stronger than the joy of winning. In everyday life, this explains why people avoid selling a house at a loss, even if it's a rational decision, or why they hold onto outdated technology because they "paid too much to replace it." When it comes to stock trading, anyone can talk about cutting losses and letting winners run....
The House Money Effect is a psychological bias where people treat money they’ve recently won (or earned easily) as less valuable than their original capital. This leads to riskier decisions like a gambler taking bigger bets after a hot streak. This cognitive bias, borrowed from casino psychology, transforms how traders perceive and handle risk after periods of success. When trading with profits,...
Hyperbolic discounting is one of the most powerful yet least understood psychological forces in trading. This cognitive bias leads investors to choose smaller, immediate gains over larger future rewards, fundamentally altering how they approach position management and long-term strategy. It's a pattern that repeatedly undermines thoughtful investment plans, turning carefully constructed trading...
Have you ever refused to sell a stock at a loss because you “knew” it would recover? Or hesitated to buy because the price seemed too high compared to a past level? That’s anchoring bias, and it’s one of the most dangerous traps in trading. It tricks you into making decisions based on outdated price points rather than real-time market data. The best traders don’t anchor to the past—they adapt to...
The Kelly Strategy, developed by John Kelly at Bell Laboratories, provides an optimal strategy for capital allocation in investment and gambling. It aims to maximize the logarithm of wealth over time, ensuring optimal growth rate while managing downside risk. The Kelly Criterion finds applications in investment management, portfolio optimization methods, and sports betting bankroll...
The Downside Tasuki Gap candlestick pattern is a bearish continuation pattern that suggests an existing bearish trend is likely to persist after a brief pause. Unlike reversal patterns that indicate trend exhaustion, the Downside Tasuki Gap signals that sellers remain in control, even as the price briefly pulls back. This pattern consists of three candlesticks and appears when the second candle...
The Upside Tasuki Gap candlestick pattern is a bullish candlestick continuation pattern that suggests an existing bullish trend is likely to continue after a brief pause. Unlike reversal patterns that indicate trend exhaustion, the Upside Tasuki Gap signals that buyers remain in control, even as the price briefly pulls back. This candlestick formation consists of three candlesticks and appears...