Don't marry your bias: A lesson from the AUDJPY breakout
Watching the $AUDJPY move this week really hit home a lesson I keep relearning: never marry your bias. I had a clear short bias on it, based on some intermarket analysis with $DXY strength and a general risk-off sentiment I was seeing in other pairs. Price was coiling, looked like a decent setup for a leg down.
Problem was, I got so fixated on that short that when it started breaking up through my resistance levels, I saw it as a fakeout, a liquidity grab before the real move. Ignored the price action screaming otherwise. Ended up taking a small loss on a short, then another when I tried to re-short higher on a pullback, stubbornly believing my original thesis would play out. By the time I actually flipped my bias, a good chunk of the move was already gone. It's frustrating because the charts were telling me one thing, but my preconceived notion was clouding my judgment. Need to be more adaptable; the market doesn't care about my bias, it just is what it is.
This is so relatable. It's tough when you've done all your homework and the market just decides to do the opposite of what you expect. How do you usually manage to cut ties with a strong bias once it's clearly invalidated?