2 - Everything is Interconnected
The beauty about the stock market is that it has to do with everything that is going on around the world with a focus mostly on the US which is the leading indicator and driver of the economy worldwide. Whether there is just an increase or decrease in the Federal Reserve’s prime rate, or if there is a hurricane or a terrorist attack, it will be reflected in the market. Everything is interconnected and that is why you always have to stay informed about everything that is going on; information is very valuable. The market is about the past, present and future. In fact the market is always on looking towards the future and the present situation is based on future expectations. The market continually evolves with time and that is why the future is always impossible to predict, but always there to speculate. Even if you do manage to predict future outcomes, you will not be able to do so on a regular basis, in the long term. In the end, everyone is playing the same game. Why is predicting the future impossible? Simply because like the world, the stock market continually evolves. You will never know enough to stop learning and your strategy may continually evolve with time. However this doesn’t mean that looking back into history cannot be helpful. On the contrary looking back will help us understand the future and not repeat the mistakes of the past; this is evolution.
“Trading is not about predicting the future; it’s about being prepared and foreseeing every possible future scenario by knowing how to react in the occurrence of any event.”
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