|  JUL 1983

Confessions of a Speculator: Why Losses Occur by JESSE H. THOMPSON/Technical Analysis staff writer

Confessions of a Speculator: Why Losses Occur by JESSE H. THOMPSON/ Technical Analysis staff writer ""The Markets"", whether envisioned as the stock markets, the futures markets or any of the myriad forms and reflections of price activity, are all somewhat compelling. Driven by hope, fear, greed, curiosity or crowd psychology countless individuals gather around the exchanges of the world (or by proxy around their quote machines and computers), noting and participating in the constant movement of prices. Maybe it's the reflections of the future, cast in the shadows of price activity that compel so many. Nevertheless, for some it is either a business or a serious hobby. If you are reading this article you probably fall into one of the latter two categories. Whether you are a novice or an experienced speculator, it is good to remember that all of us are constantly falling prey to what W.D. Gann so aptly called ""the human element."" What we need is a preventative medicine, and applying technical methods when entering and exiting the market is a good start. Disciplined implementation of a technical method lessens the probability that you will succumb to greed or fear. It is also highly beneficial to obey certain time worn rules and that is the subject of this article. One of the best professional speculators I have ever encountered made the following statement in relation to establishing a sound foundation for successful speculation: ""The most important thing is to: 1 ) Learn the right rules, 2) Obey the rules, and, 3) Implement them consistently."" This applies to both general and specific trading rules.

by Jesse H. Thompson