What is the core of trading?

It is to follow the trend and avoid shocks.

There are various methods and techniques for making profits in the market, but to sum up, it is nothing more than huge profits from unilateral trends and huge retracements from wide-range shocks.

The key to profit lies in how to maintain huge unilateral profits and reduce huge retracements from wide-range shocks.

Therefore, the trading system was born, focusing on following trends and avoiding shocks. If you do a good job of following the trend, the winning rate will naturally be high. If you can't avoid most shocks, the winning rate will naturally not go up. The same is true for the profit and loss ratio. Only on the right track can you have a high profit and loss ratio and winning rate, which is not a conflict.

Some people say that the winning rate, profit and loss ratio, and frequency are a triangle and cannot be obtained at the same time. In fact, I don't agree. Following the trend, the winning rate and profit and loss ratio will be very high. And the frequency can also be obtained by having more varieties without waiting too long.

How to build such a trading system is the key to profit. If the profit and loss ratio is high, then the operation cycle cannot be too small to have a large space. If the risk is low, then the single stop loss should be small, and then the position should be opened in a small cycle to have a small stop loss. To have a high winning rate, you need to avoid the volatile market and only do the confirmed trend market. The volatility often occurs when the market reverses, so you need to cut off the head and tail.

How to build a system that has both large and small cycles and can cut off the head and tail? Take three cycles as an example. The long cycle determines the trend direction, the medium cycle confirms the same direction, and the short cycle confirms the breakthrough and opens a position again. Three confirmations can avoid most of the volatile market to obtain a high winning rate, and obtain medium and long cycle space profits and a large profit and loss ratio. Three cycles obtain three support and resistance levels, and include the participation of long, medium and short-term traders. With a high winning rate and a high profit and loss ratio system, great wealth depends on opportunities, and small wealth can be grasped.

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