Thread by @ProdigalTrader

psychology behind attempting to find and trade tops/bottom is quite straight forward.

suppose price is going up and near resistance
conceptually trade here is short
if the price fell from resistance and confirmed trend reversal,

1/5

one needs bear a bigger SL here
trend reversal point after confirmation being quite far
So we would wait for pullback so that risk would be lesser
When pullback actually happens,
he assess it as correction and assume the previous trend strength is lost already

2/5

Now, when price completes pullback and resumes falling again
he find himself in the same dilema, that SL quite wide as price fell already

Amateur traders find its solution as picking the top
so that he would be quite close to the SL level when making the entry

3/5

thats emotionally more comforting
this exactly is the reason behind people choose to predict rather than going for trend following

The fear of losing money in the form of SL (which he alone assumed quite big) is the initial problem
forced him not to take the trade

4/5

Again, when pullback came reducing the risk size,
lack of conviction on the trend again kept him away from the trade

Address these issues at an early stage
more than skill or knowledge, such isssues are best sorted at psychological level

5/5