The gambler's fallacy is believing...

A streak must end because it was long

The gambler's fallacy

Monte Carlo casino, 1913: the roulette ball landed on black 26 times in a row. Gamblers lost fortunes betting that red was "due".
They fell for the gambler's fallacy: believing a streak must end soon just because it has gone on so long.
But the wheel has no memory. On every spin, red and black had exactly the same chance: 18 slots out of 37.
Markets can fool you the same way. Five red candles don't make a green one more likely by themselves. A falling price can keep falling.
Common mistake
Myth: "I've won five in a row, so I can't lose." That's the hot hand trap. Reality: a streak alone, winning or losing, is not a reason to trade bigger.
Key takeaway
Trade a reason you can test, not a feeling that something is "due".

In a coin-flip market, after five red candles the next one is... Still about 50/50Each flip is independent. Past results don't change the odds of the next one.
The gambler's fallacy is believing... A streak must end because it was longIt treats independent events as if they kept score. A wheel or a coin has no memory.
A better reason to trade is... A rule you have testedA tested rule has evidence behind it. A feeling or a streak doesn't.
Black has come up 10 times in a row. On the next spin, red's chance is... The same as on any spinOn a single-zero wheel, red has 18 slots out of 37 on every spin, whatever came before.