Glossary › recency bias

Trading glossary · psychology

recency bias

Thinking the last few things that happened will keep happening, and forgetting everything before them.

The fuller meaning

A cognitive bias that gives the last few trades or candles too much weight: a short winning run feels like skill, a few losses like a broken method. Judging a method over a proper sample and using written rules and checklists counter it.

recency bias.

Related words

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