Glossary › confirmation bias

Trading glossary · psychology

confirmation bias

Only noticing facts that agree with what you already think, and ignoring the ones that do not.

The fuller meaning

The tendency to seek and interpret evidence in ways that favour existing beliefs. Traders notice every sign supporting their trade and miss the rest; fixes include writing one fact against the trade before entry and asking an AI, with a neutral prompt, for the strongest case against it.

confirmation bias.

Related words

anchoring · boredom trading · chasing · cognitive bias · consistency · cool-down rule · discipline · disposition effect · emotion · entry rule