Why do you always lose money when trading with indicators?
I discovered something interesting today, the use of the position indicator.
If you read and study, you will see the description in Figure 1:
In an uptrend, a decrease in open interest is a bearish signal.
But looking at the actual chart, Figure 2, the pie has been decreasing from 1.50,000 to 7.30,000.
If you follow the theory in the book and reduce the position and be bearish, you will be shorting the pie from 1.50 thousand to now, and ten thousand pairs of pants are not enough to make a loss.
So the question is, who is wrong? The loss of editors or the distortion of reality?
The editor is right, the chart is right, you are wrong.
The mistake is to rigidly apply dogma and rigidly apply learned knowledge without studying the applicability of the theory and failing to combine it with reality. This is called dogmatism.
The theory of position holding is completely opposite to the actual performance, which is a super typical performance here. Other similar mistakes that novices often make include golden cross and dead cross, top-bottom divergence... and so on.
The key to getting out of this predicament is enlightenment, the key to enlightenment is thinking, and the key to thinking is combining practice.
There is no one-size-fits-all rule in the trading market, so the key to trading is not to learn knowledge, but to cultivate oneself. When holding a position, be as steady as a mountain, and when using knowledge, be as flexible as a rabbit.
This is the ultimate realm of trading.
