What is the core essence of trading?

1. Uncertainty is the basis of the existence of the market, and future market trends cannot be accurately predicted.
2. The trend is chaotic, and traders need to divide and define the chaotic trend, form deterministic rules, and use deterministic rules to deal with uncertain trends.
3. What is a trend? The leeks need to define their own trend and use it as a basis for opening positions and trial and error. A breakthrough is a trend, a pullback to a support level is a trend, a crossover of two moving averages is a trend, touching the top and buying the bottom is a trend, and chasing ups and downs is also a trend.
4. What is following the trend? Look at your trading account. If you make money, you follow the trend, and if you lose money, you go against the trend. It has nothing to do with the trend graph. If you do a lot of bullish trend but the loss is increasing, can you say that you follow the trend? Why do you still lose money if you follow the trend?
5. How to open a position? You can open a position in any way. What opening a position can determine is the trading rhythm and trial and error efficiency, but it cannot determine whether you can make money. You can make money by flipping a coin to decide whether to go long or short. Is your method worse than flipping a coin to decide whether to go long or short?

6. The winning rate of opening a position of any trading method cannot produce an advantage. The winning rate of a one-to-one profit and loss ratio after the law of large numbers takes effect will be infinitely close to 50%. Many traders have long focused on opening a position, and the core of making money is not here.
7. What is the core of making money? It is to make a high profit-loss ratio through the closing logic of cutting losses and letting profits run. This is the only source of advantage.
8. The core purpose of position management is to protect the principal and to make more money when making money and lose less money when losing money.
9. What is trading technology? Trading technology starts from the moment of opening a position. It is about how to deal with risks and returns, what to do if it is right and what to do if it is wrong, how to cut losses and how to make profits run reasonably. All kinds of research before opening a position are trading analysis, not trading technology.
10. Why do we know a lot about trading but still can't trade well? Because knowing is far from enough, the cognition and understanding must reach the top level. Who doesn't know that stop loss is right, but still holds on to the huge losses.

11. Why can’t you hold on to your profitable orders? Because profits often don’t run and you often get negative feedback.
12. Why is it so difficult to make money? First, making money depends on the market trend that matches the trading method. If there is no market trend, you have to hold back even if it is high. Second, the advantage of high profit and loss ratio is relatively weak, which means that even if you have a high level of skills, making money is a tortuous and bumpy process.
13. Are there huge profits in trading? Profits and losses come from the same source, and taking risks to gain returns. Huge profits come at the cost of huge losses. What’s important is what kind of huge profits you want to make and what price you are willing to pay for it.

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