Anyone familiar with the endeavor of trading has eventually realized the flaws of our human instincts. This isn’t isolated to investing.
It’s a widely documented phenomenon that we’re constantly susceptible to subconscious biases.
We’re approaching this from the lens of technical analysis. But apophenia is universal to the human condition.
Apophenia: the tendency to perceive a connection or meaningful pattern between unrelated or random things (such as objects or ideas).
Let’s run through some examples and see how it applies to trading.