Weak Hands
"Weak hands" is a term used to portray a trader or investor that lacks the confidence, resources, or ability to hold their positions or to stick with their trading plans. In any case, the term might be employed contrastingly as per the type of market.
In both the Forex and cryptocurrency markets, "weak hands" is much of the time utilized with a negative undertone, which portrays the behavior of unpracticed and emotional traders. Typically, these traders present predictive trading examples and strategies, which are much of the time took advantage of by market creators and seasoned traders.
So we might characterize a "weak hands" trader as the one that trades impulsively, driven by feelings as opposed to logic. They will generally exit positions when the market shows any kind of bearish behavior or due to terrible news, frequently selling their assets for a loss. Such individuals don't have confidence in the long term growth of their investments and can be without any problem "shaken out" by common price swings.
Put in another manner, weak hands traders have predictable buying and selling behaviors as they are driven by [fear, vulnerability, and uncertainty (FUD)](/fear-vulnerability and-uncertainty). They will generally enter and exit positions in very improper minutes, and are not able to hold their assets for a really long time.
In the futures markets, be that as it may, the term doesn't carry a derogatory importance. It basically portrays an individual that main trade contracts, with practically no expectation of taking the underlying asset or settling their position. They act more as price examiners than investors.
Features
- A less-realized definition is that of a futures trader who doesn't expect to take, or give, delivery of the underlying asset.
- Weak hands is the term frequently used to depict traders and investors who lack conviction in their strategies or lack the resources to carry them out.
- Weak hands wind up buying at the ups and selling at the downs, a reliable method for losing money.
