Bullish and Bearish are Bearish and Bullish
The Unexplainable Nature of Market Movements
What? Is this a riddle?
Yes. The markets are one big riddle. An unexplainable force driven by unexplainable things, in inexplicable ways.
Have you ever looked at a bullish candle, thought “this looks strong” and bought into the candle, only for this candle, or the following candle, to reverse straight after?
Have you ever held a Forex or Crypto trade or investment as it terrifyingly crashes to the ground, forcing you to a point where you can no longer take it, and you close the position, only for the price to suddenly rocket back to the upside?
We’re sure you have, because it’s happened to us and everyone else we know who trades. This is the great riddle of the market.
The Paradox of Strength Turning to Weakness
How something seemingly so promising, something indicating extreme strength or weakness, can suddenly result in the complete opposite outcome — that’s the secret behind how the financial markets operate.
Stocks, Forex, Crypto — everything. They frequently do the opposite of what you think, feel, believe and are taught to believe is the truth.
Why Educated Traders Still Fail
This is why so many traders fail, especially those with qualifications, degrees and higher levels of education. They have been educated through a system based on a specific set of rules and governance.
Right is right, and wrong is wrong. You must follow the path you’re told to follow, and you will emerge successful with a piece of paper to congratulate you.
Your failure in the education system isn’t based on doing what you’re told and not working; it’s based on not doing what you’re told is correct.
The same applies to working a 9-5. If you do what you’re told and know is correct, you will succeed. If you lose your job, it’s not because you did what you’re supposed to do; it’s because you didn’t do the correct thing.
Rational Thinking vs Market Reality
In regular day-to-day life, we engage in rational, pre-programmed inputs to achieve an expected outcome.
The financial markets operate on a different model.
When understood, you will discover they’re operating perfectly rationally. It’s humans being irrational and unable to change their limited thought and belief system.
Markets appear foolish to those who are trapped in the cycle of thinking, believing, and acting on rationality embedded within us by the educational and corporate systems.
The Illusion of a Fair Market
Most people are led to believe that the financial markets are designed to be a fair playground, a balance between buyers and sellers. When one side significantly outweighs the other, the market tends to move in a particular direction. When the buying and selling pressure is balanced, the markets consolidate.
This, of course, is surface-level thinking — exactly how ‘they’, those who pull the strings of market movements, want you to think.
The Truth: Markets Are Manipulated
It’s no secret that the Stock Market, Forex Market and Crypto Market are all havens for mass market manipulation.
Nothing is coincidental. Everything is precisely planned down to the very last cent.
The average person is contained in a system of limited beliefs. They do not question anything; they barely think, floating through life on autopilot.
This is the optimal state of being for those in control of the market. To successfully execute market manipulation, you must have a herd of sheep willing to follow the bait you generate blindly.
That’s all this game is. There are hunters and there are the hunted. We are the hunted.
The Moment of Awakening for Traders
No trader becomes successful or profitable in any market until they have the moment of awakening, where they realise it’s all rigged.
If markets were based on rationality, there wouldn’t be proven statistics showing that over 90% of traders fail.
The 90% do not fail because they’re bad traders; they fail because they’re unable to detach from their ego, and the inability to break out of their comfort zone, which is what they perceive as usual and rational.
The Psychology of Candlestick Colours
Candlestick charts are automatically set on almost every Forex and Stocks platform, Cryptocurrency exchange, and TradingView, displaying green and red colours. Green represents a bullish, upwards-moving candle. Red represents a bearish, downwards-moving candle.
Why is that?
The Subconscious Associations
Let’s go deeper into the psychology behind this.
What do we subconsciously associate with the colour green?
Hope, greed, euphoria, safety, success.
What do we subconsciously associate with the colour red?
Fear, panic, regret, pain, anger.
Nobody ever questions why these colours are automatically chosen.
This deeply subconscious association with colours is what newcomers encounter from the outset.
The Emotional Trap
As an inexperienced trader with no understanding of technical analysis, fundamental analysis, candlestick charts, or other trading-related concepts, they immediately associate the emotional connection with these colours with their heightened emotions in the early stages of their trading.
When we first begin trading, we’re more vulnerable to the emotional rollercoasters that market volatility brings.
Our first live trade is exhilarating. Win or lose, we find ourselves hooked.
Wins and losses experienced in the very beginning are already highly emotional events. As time progresses, we learn to associate these emotionally triggering experiences with the colour of the candlesticks.
Red becomes something we fear, green becomes something we chase.
Weaponising Trader Psychology
This is the key behind market manipulation.
When 99% of traders are emotionally attached and reactive to the colour of candlesticks, blindly pursuing trades based on the colour and size of candlesticks, they become the ultimate form of weaponisation.
Imagine having the money, power and influence to move markets. You’re in complete control.
You set the initial moves, knowing the rest of the sheep will blindly follow and become your exit plan.
This is the secret behind how markets work.
The Bitcoin Crash Example
Let’s use the example of Bitcoin before something terrible happens and it crashes.
Does it ever simply crash? Or have you noticed before a big crash in the crypto market, alongside every other market, there’s always a huge bullish move first?
Why?
Imagine you’re one of these wealthy people who often work as a collective. You have significant influence in the media, banking, economy, politics, and other areas. You’re amongst the minority playing with Billions of Dollars.
You buy Billions of Dollars worth of Bitcoin and increase the price by 30%. You have created the move, the herd of retail traders follow the move and assist in contributing to pushing the price slightly higher.
Remember, the average retail trader has less than $5,000 individually to trade with. Individually, they’re weak. Collectively, when convinced to chase large candles blindly, they’re incredibly powerful and become the liquidity.
The Different Game Institutions Play
One of the biggest mistakes retail traders make is never realising that the institutional players and elite play a whole different game from them.
When trading with Billions of Dollars, you do not need the moon. Small 20-30% moves are huge.
When it’s time to sell, they need Billions of Dollars of exit liquidity to sell into. That’s where you come in to fill the void and complete their mission.
How We Do Things at Innovation Markets
At Innovation Markets, we do things differently from how most never will. We do not use colours on our candlesticks.
If we ever do, we certainly don’t use red or green.
We’ve taught our members the unique skill of reading the markets without colours on their candlesticks.
We operate technical analysis with a pure focus on raw price action, eliminating the emotional element of trading.
Enabling you to see the market from a standpoint where you can see manipulation happening in real time.
These simple tricks will help you become a winner, whilst everyone else becomes the bait.