Luke L Jackson#32

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How does confirmation bias affect forex analysis?

Confirmation bias makes traders seek evidence supporting their beliefs while ignoring contradictory data. For example, a bullish trader on GBP/USD only reads positive UK economic news, disregarding negative developments. Institutions counter this with team-based analysis, ensuring checks and balances. Retail traders must actively seek disconfirming evidence to test their views. Benefits: conviction aids confidence. Risks: blind spots distort analysis. Successful forex analysis requires objectivity—traders must challenge their own assumptions to avoid one-sided errors.