In CFD trading, users often decide whether to open, increase or close a position based on the current price. However, Wmax behavioral finance research has found that people’s judgments of “reasonable prices” are often not based on the current market state, but are dominated by a preconceived number – this cognitive bias is called the Anchoring Bias. Whether it is cost price, historical high point, round number mark, or predicted value in a certain piece of news, once it becomes a psychological anchor, it will systematically distort subsequent price evaluations, leading to irrational behavior of "not buying when it is time to buy, not walking when it is time to leave."

The power of the anchoring effect is that even if users know that the number is outdated, they will still use it as a reference unconsciously. For example, a user who buys gold at US$4,800 may regard US$5,000 as a "high level" and ignore that the current market liquidity, volatility and macro environment have fundamentally changed.

1. Cost price: the most stubborn psychological anchor

For most users, holding costs are the strongest anchor point. When the price is higher than the cost, it is easy to stop the profit prematurely, because "recovering the capital + small profit" brings a sense of satisfaction; when the price is lower than the cost, it is easy to hold on, because the psychological accounting mechanism of "no return of the cost = no loss" delays the stop loss.

What's more subtle is that cost price will affect users' judgment of new opportunities. For example, if you were locked into a long position in crude oil at $60, even if the current fundamentals support going long, you may avoid the same price because you lost at $60 last time and miss the opportunity. This approach of defining current value based on past experience ignores that the market has entered a new stage.

2. The misleading of integer thresholds and historical extreme values

In addition to cost, integer digits (such as 5000, 100) often become collective anchor points. Users will think that "gold prices will inevitably fall back after breaking through 5,000", or that "silver 100 is a strong resistance", but have not verified whether the current market depth supports this logic. Although these psychological gates tend to be self-actualizing, they are not absolute rules.

Likewise, historical highs or lows tend to be given special meaning. For example, "Gold peaked at 3,200 in 2020. Now 5,500 is too high" - this comparison ignores a key fact: global money supply, debt levels and geopolitical patterns are no longer what they used to be. Using old anchors to measure the new world will inevitably lead to misjudgments.

3. Invisible Anchor Implanted by External Information

Anchoring not only comes from one's own experience, but also from external information. A piece of news "Experts predict gold will reach 6,000 by the end of the year" may make users regard 6,000 as a reasonable target; a "silver bubble theory" may make 120 an insurmountable psychological ceiling. Even if the user does not agree with this view, their brain will still use this number as an initial reference value to adjust, and the adjustment is often insufficient.

Experiments have shown that if a number is randomly given (such as "the number of member states of the United Nations") and then asked about "the reasonable price of gold", the subject's answer will be significantly affected by the former. This shows that anchoring can take effect in completely unrelated situations and is difficult to prevent.

4. How to identify and loosen psychological anchor points?

The first step in combating anchoring is to proactively identify your own anchors. Wmax Users are advised to ask themselves:

"What reference do I base on when judging the current price?" "Is this reference still applicable to the current market environment?" "If I don't know the cost price, how will I make a decision?" By deliberately questioning the effectiveness of the anchor point, its control can be weakened. For example, replace "cost 5,000" with "current volatility 45%, sufficient liquidity" and replace subjective memory with objective indicators.

5. How does the platform assist in de-anchoring decisions?

Wmax Embed multiple “de-anchoring” mechanisms into product design:

Hide user position cost lines on the chart interface (off by default), which need to be turned on manually to avoid visual interference; provide "anchor-free analysis mode" to temporarily block all historical markers, integer grids and forecast lines; compare the difference in results between "cost-based decision-making" and "strategy signal-based decision-making" in the review report to reveal the anchoring cost. These designs do not negate user experience, but create a cleaner cognitive space and allow judgment to return to the present.

Conclusion: True objectivity begins with letting go of past numbers

The financial market never changes direction because of your costs, nor does it stop at the round number threshold. Wmax I always believe that the mark of a professional trader is not how many anchor points are remembered, but the ability to recalibrate the understanding of price at every moment. Because in a rational behavioral framework, the most sober judgment is not "Is it higher or lower than the cost", but "Is the market at this moment worth my participation?"