Tariff Trauma, Unexpected Strength and Important Trading Lessons.

Have you ever refused to sell a stock at a loss because you “knew” it would recover? Or hesitated to buy because the price seemed too high compared to a past level?

That’s anchoring bias, and it’s one of the most dangerous traps in trading. It tricks you into making decisions based on outdated price points rather than real-time market data.

The best traders don’t anchor to the past—they adapt to the present.

This week, we’re diving into how to break free from anchoring bias, make decisions based on real signals, and trade with a systematic edge.

But before we get into that, let's check-in with what the markets are doing...

Stock Market Update for 8 March 2025

The main markets I trade have really pivoted in the last couple of weeks with Hong Kong emerging as the leader in my stock portfolio and the US and Australian markets being punished by US trade tariffs and global tensions.?

Over the last couple of years it has been easy for traders and investors to feel like geniuses by holding Nasdaq stocks. In my weaker moments, when the Nasdaq was really hammering up, I even found myself wondering why I don't just concentrate on US big tech and simplify my life...

... But then I remember this conversation...

One of the primary ways that systematic traders sabotage themselves in the markets is by making changes to their capital allocation based on what is happening in the market now. This is inevitably a mistake because it is 100% FOMO driven.?

It also explains one of the biggest reasons why so many systematic traders launch a new system only to go straight into drawdown. It comes back to the choice of the system and the market. It is so tempting to develop a system to profit from the latest hot market or sector... but this is a FOMO driven decision. Prioritising system development work on markets and strategies that are hot NOW does not guarantee profits tomorrow. In fact most of the time it leads us to walk face first into a drawdown!

As I shared with my Trader Success System Mentoring Students in our Breakthrough Workshop this week, a much better approach is to do mental scenario analysis of your portfolio and ask yourself "What market behaviour am I NOT able to profit from?", and build or find strategies for those conditions and markets. This way you are building your portfolio strategically rather than in a FOMO driven way!

So what is happening in the markets at the moment?

• US Volatility is spiking thanks to the uncertainty caused by Trump's Tariff Tiff with pretty much everyone on the planet.
• US Tech continues to correct with the Nasdaq down over 3% this week, US Sectors were down pretty much across the board. In fact some of my US Short systems have started triggering and were loading up this week. This doesn't mean the market will keep falling of course, but it does show how much weakness there is in the market right now.
• In the global markets the DAX has emerged as a beacon of strength? (Crap - I don't have enough Europe exposure, should I launch a new system for Germany... "Wait Batman, don't slap me again, I'll build my portfolio strategically I promise!")
• The Chinese market has continued it's strength this week with both the Hang Seng and the China 50 up over 5% this week. If you have been following me for a while you will know that Hong Kong stocks is one of my favourite diversification moves because it frequently moves differently from the major western markets and it is easy to go long and short Hong Kong stocks.?

Here are the recent moves by market and sector across the globe as at 8 March 2025:

My belief - if you are not long / short multiple markets then something is going to come along that hurts your portfolio. It is only a matter of time. If you want to implement a globally diversified portfolio of proven systems, apply to join The Trader Success System now. We will have you up and running, fully automated with a diversified portfolio of strategies within 6 months.

How Anchoring Bias is Hurting Your Trading & How to Fix It

Most traders don’t realize they’re making decisions based on past price points rather than objective market conditions. This leads to:

Holding onto losing trades for too long

Hesitating to enter trades at new highs

Misjudging trends by fixating on outdated reference points

But here’s how to fix it:

Follow a rules-based system instead of making emotional decisions.

Set predefined entry and exit rules to avoid hesitation.

Stop anchoring to past prices—every trade is a fresh decision.

Want to remove emotions from your trading?

Read the full article here:

Break Free from Anchoring Bias

Trading Tip of the Week

How to Make Smarter Trading Decisions Without Emotion

Most traders think confidence comes from making the right trades. But in reality, confidence comes from following tested systems.

Detach from your past trade prices - every trade is independent.

Trust your system - let the rules guide your actions.

Focus on execution - stop overanalyzing every small move.

Build a strong portfolio - Covering different strategies / markets / timeframes

Actionable Step:

Before your next trade, ask: “What markets and behaviours am I not able to trade profitably right now?" and then go and close those gaps as your capital permits

Quote of the Week

"Smart traders don’t fight the market—they adapt to it."

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Featured Video: How I Manage ALL My Trading Ideas

Great trading ideas don’t happen on demand—they strike when you least expect them.

In this video, I share:

How to capture and organize trading ideas effectively

Why most traders forget their best ideas (and how to avoid it)

The simple process I use to turn ideas into profitable trading systems

Watch now and start refining your trading ideas today:

Watch the Video

I would really appreciate your help since you read this far, please reply with a single number from 1-10 to tell me how interesting and useful this week's market update was. Bonus points if you ask me a question that I can address in next week's market update.

Remember - You are only one trading system away!

Adrian Reid

Founder, Enlightened Stock Trading

P.S. Whenever you’re ready... here are 4 ways I can help you improve your trading:

1. Join the FREE Enlightened Stock Trading GroupIt’s my Facebook community where smart traders learn to trade with less time, effort and stress.— Click Here

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