A decline is not a risk, but a process of reducing risk. Risks often arise during an uptrend, while opportunities become apparent during a downtrend. Therefore, your actions during a decline will directly affect your mindset during an uptrend. If you are afraid to buy during a decline and instead choose to chase after rising prices, you are likely to face the risk of being trapped; once trapped, you often choose to cut losses, creating a vicious cycle.
On the contrary, a rational strategy is to buy in batches during a decline and take profits in batches during an uptrend. Whether it is investing or trading, it is essentially about selling high and buying low. Although chasing gains and cutting losses may bring some profits in the short term, this approach does not have long-term sustainability.
Remember, respect the market, master your emotions, and you can remain undefeated in this volatile market.
