Trading Lesson of the Week

• March 22, 2026

In This Week’s Issue:

• Market Outlook – Light at the End of the Tunnel
• This Week’s Market Minutes video – My Top Stock Trading Strategy for Next Week
• Trader Training – 8 Emotional Mistakes That Cost Traders Money
• Strategy – Sit in Cash

 

Market Outlook – Light at the End of the Tunnel

The market showed some buyer enthusiasm on Monday, breaking the short term downward trendline. It is not a strong reversal signal as the break higher does not come after the build of a rising bottom. It is, however, a light at the end of the tunnel as it is the first time in weeks that the market has been able to show some strength in the pessimistic market outlook.

Gold has softened and Oil prices have broken their short-term upward trend line.

We need further confirmation of these trend reversals but today was a step in the right direction.

 

This Week’s Market Minutes Video – My Top Stock Trading Strategy for Next Week

When the market cools, traders must focus on Alpha stocks to make consistent profits. This week, I explain what an Alpha stock is and the key factors required for a good trade set up. Then, I provide my analysis of the stock, commodity, currency and bond markets. Finally, a look at the trade of the week on ACXP.

Watch This Weeks Video on YouTube

https://youtu.be/uE2aaC6GExs

 

Commentary – 8 Emotional Mistakes That Cost Traders Money

In trading, emotions are the enemy.

They push us into decisions that feel right in the moment—but look obviously wrong in hindsight. The market has a way of exposing emotional thinking quickly, and expensively.

If you want to improve your results, you need to recognize where emotion creeps into your process and eliminate it.

Here are eight of the most common emotionally-driven mistakes traders make:

 

1. Failing to Limit Losses

Nobody is always right. Not you, not me, not anyone.

The difference between successful traders and everyone else is simple: what they do when they’re wrong.

When the market tells you your analysis is incorrect, accept it. Exit the trade. Move on. Small losses are the cost of doing business.

Holding and hoping is not a strategy—it’s a slow leak of capital.

 

2. Averaging Down on Losers

Averaging down feels logical: buy more at a lower price, reduce your average cost, and wait for the bounce.

And yes—it works… until it doesn’t.

The problem is not the times it works. The problem is the one time it doesn’t. When a stock keeps falling and you keep buying, you turn a manageable loss into a catastrophic one.

Capital preservation is everything. Without it, you’re no longer a trader—you’re a spectator.

 

3. Chasing Price

Fast-moving stocks are seductive. When price is accelerating higher, it feels like opportunity.

In reality, it’s often where risk is greatest.

When a stock is extended far above its trend line, you are paying a premium driven by emotion—usually someone else’s.

The better strategy is simple: let the stock pull back, then buy into weakness within an uptrend.

Never chase. Let the trade come to you.

 

4. Trusting Public Information

If everyone knows it, it’s already priced in.

News releases, earnings reports, analyst opinions—these are available to everyone. That means they offer no edge.

Markets move on shifts in supply and demand, not on information that’s already widely known.

Focus on price and volume. That’s where the real story is told.

 

5. Selling Winners Too Early

One of the most expensive habits in trading is cutting winners short.

Why do we do it? Fear.

We fear giving back profits, so we grab them at the first sign of a pullback. Then we justify it with phrases like, “you never go broke taking a profit.”

But you also never build wealth that way.

Strong trends include pullbacks—that’s normal. The skill is learning to distinguish between a healthy pause and a true reversal.

Remember: a trade isn’t truly successful until the reward significantly outweighs the risk.

 

6. Taking Too Much Risk

When too much money is on the line, emotion takes over.

You hesitate to sell losers. You rush to sell winners. You abandon your plan.

The solution is position sizing. Risk only what you are comfortable losing.

Good traders are not fearless—they are disciplined. They control risk so they can think clearly.

 

7. Fighting the Market Trend

Trading against the market is like paddling upstream—it’s exhausting and usually unsuccessful.

Before entering any trade, ask: who is in control—buyers or sellers?

Your job is not to argue with the market. Your job is to align with it, or identify when control is shifting.

Trade with the trend, not against it.

 

8. Trading Possibility Instead of Probability

“Think of the possibilities.”

That’s how lotteries are sold—and how traders lose money.

It’s easy to imagine what could happen: a breakthrough discovery, a viral product, a massive breakout.

But trading is not about what’s possible. It’s about what’s probable.

If your strategy does not have a positive expected value over a large sample of trades, you are gambling.

And gamblers, over time, lose.

 

Final Thought

The market rewards discipline, not emotion.

Every one of these mistakes comes from the same root cause: letting feelings override process.

If you can build a rules-based approach—and more importantly, follow it—you put yourself on the right side of the game.

Because in trading, success doesn’t come from being right all the time.

It comes from doing the right things, consistently.