#TradingPsychology When a stock drops from $10 to $8, traders often react emotionally—some sell out of **fear** (locking in losses), while others hold due to **hope** or denial (risking further declines). These decisions, driven by cognitive biases like **loss aversion** and confirmation bias, can lead to irrational choices instead of objective analysis. The key lesson? Mastering emotions and sticking to a disciplined strategy is critical, as panic-selling may miss future gains, while blind hope can deepen losses—successful trading requires balancing risk and rationality.