A trader enters a trade and watches it go into a loss position. Unwilling and unable to admit the market entry was inappropriate, the trader insists on holding the position and may also decide to add to the position, deciding that he is willing to hold the position for a longer term.
The trader just switched time frames and committed a likely mistake.
This is an emotional mistake that the trader has made, succumbing to his mind and ego's inability to accept that he has made a mistake. Rather than admit his mistake, the trader decides that he will just wait it out.
Some of my friends did just that when the Nasdaq was at 4400 a few years back. They're still waiting and will be waiting a long time for that tech stock to recover that they determined they would just hold until it bounced back.
Making this decision usually makes the trader feel better as he has just rationalized a losing trade into a winning trade and it is easier for the ego to accept. But it normally just worsens the situation.
While this decision can work out, it will likely be only out of luck and not design. The one situation where the trader may actually be okay is where the longer term time frames are pointing in the same direction as the short term trading time frame.
More often than not, though, the trader will take a loss on any emotional decision.
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