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Psychology

Anchoring

The cognitive tendency to rely too heavily on the first piece of information encountered when making subsequent judgments. In memecoin trading, entry price becomes the anchor, causing traders to hold losing positions waiting to get back to even rather than evaluating the current setup on its merits.

See also
Psychology Sunk Cost Fallacy Continuing to commit to a course of action because of resources already invested, rather than future expected value. In memecoins: holding a dying bag because 'I've already lost so much.' Sunk costs don't predict outcomes — they predict only that you've already paid. → Psychology Disposition Effect The documented investor behavior of selling winners too early and holding losers too long. Named by Shefrin and Statman (1985), confirmed empirically by Odean (1998). The financial-markets fingerprint of loss aversion. Structurally incompatible with memecoin trading, which rewards letting rare winners run. → Psychology Reactor (Archetype) The trader archetype anchored to feelings and PnL. Identity collapses with the bag — a green day means 'I am a good trader,' a red day means 'I am a bad trader.' Time horizon compresses to the next five minutes. Re-learns the same lesson on a six-week loop indefinitely because there is no record. →
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