We have encountered many problems in actual trading and found that more and better market analysis cannot solve trading problems, cannot achieve consistent profits, and many times the various analyzes are contradictory. The reason for leading a wave of market conditions may be only one of the factors, and the reason may change at another stage. More variables and parameters are not conducive to us solving practical problems. Traders can't find more factors for successful trading through the outside world. On the contrary, they can seek themselves and realize that their own attitude and state of mind can determine the results of trading. Clear beliefs and attitudes are necessary for the thinking of trading winners, which means that we must learn how to think with probability.
(1) You don't have to know what's going to happen next to make money, because no one knows for sure.
(2) Anything can happen, the only certainty is that the market is changing.
(3) Every moment is unique, which means every advantage, every outcome is a unique experience, so allow for mistakes. Don't be influenced by the past and trade by the rules. In trading, wait for the edge to come and repeat the process mechanically over and over again.
Accept the risk, keep the faith
Developing a unique attitude - keeping us disciplined, focused, and confident even when the odds are against us. The best traders not only accept risk, but are able to bear and embrace it. Because of the transaction, it is necessary to fully accept the inherent risks of each transaction, which is also the cost of the transaction. The best traders trade without the slightest hesitation or conflict, and even if they have a loss, they will not have the slightest discomfort when exiting a trade. In other words, the risks inherent in trading do not cause the best traders to lose their discipline, focus or self-confidence. If you can't trade without emotion (especially fear), you haven't learned to accept the risks inherent in trading. Admitting that we were wrong and took a loss is excruciatingly painful and certainly something we want to avoid. However, as traders, we face these two possibilities all the time. Once we learn to accept the technique of risk, no matter how the market operates, we will not feel pain. If the market doesn't have the power to make you miserable, there's nothing to avoid.
Traders only have probabilities in their eyes, and establish an objective state of mind - not tilted, or distorted, by your fear of what will or won't happen. Because the market is neutral, it will not control our interpretation and understanding of information, nor will it control our decisions and actions. The wrong attitude creates fear instead of trust and confidence.
The best traders are not afraid. Not being afraid comes from entering and exiting trades based on the opportunities the market presents, and at the same time, the best traders develop an attitude of not being rash. On some level, everyone is scared. But when some people are no longer afraid, they tend to be rash, impulsive and reckless, and the result of their rashness is that they start to be afraid again. If you are afraid of making mistakes, your fear will cause you to misunderstand the market and cause you to make mistakes. You cannot learn enough to compensate for the negative effects of fear, you cannot be objective, and you cannot act without hesitation. In other words, there is no confidence in the face of constant uncertainty. A cruel and cold transaction means that every transaction will produce uncertain results. Unless we learn to fully accept the possibility of uncertain outcomes, you have to consciously or unconsciously avoid the possibility of pain as you define it.
Fully accepting risk means accepting the outcome of the transaction without mental uneasiness or fear. It also eliminates the pain of defining and interpreting market information. When we stop the pain of defining and interpreting market information, we also eliminate these tendencies: reasoning, hesitating, acting prematurely, hoping the market will give you money, and hoping the market will rescue us if we don't stop our losses.
Market Analysis Doesn't Solve Fundamental Problems
We do not need market analysis, however, market analysis does not lead to consistent results. It doesn't solve trading problems caused by lack of confidence, discipline or poor focus. Confidence and fear both arise from our beliefs and attitudes, but contradictory thoughts. Self-confidence requires absolutely believing in yourself, even when you lose more than you think. However, you cannot have this confidence if you have not trained your mind to ride on thoughts that are not consistent.
Everything needs attitude to win. Many people understand, but at the same time, many people do not understand the importance of attitude to results. Most people mistakenly believe that a major change in perception of the market is the key to success, but a fundamental change in attitude is the key to success. The market has no responsibility, it just acts according to the principles when it was established. If you find yourself blaming the market, or feeling betrayed, any blaming means that we have not accepted the reality that the market does not owe you. No matter how you think or work hard, the market does not owe you.
Taking responsibility means to be sure that all the results are caused by oneself, the trading results depend on the perception of the market, and the decision and action results must be accepted. Failure to fully take responsibility can lead to two major psychological barriers to success. First, you create an inverse relationship with the market and miss opportunities for consistent consistency. Second, you mistakenly think that market analysis can solve trading problems and failures.
You cannot prevent pain by avoiding losses. Markets create patterns of behavior, and patterns repeat themselves, but not every time. So once again, there is no possible way to avoid losing money or making mistakes. Losing traders focus on trying not to make mistakes, and the result is that the harder they try, the more mistakes they make. The market is probabilistic, and no matter how good a trader is, he may make mistakes, and when he makes mistakes, we must face it calmly and take the initiative. When you no longer focus on making money, but on how to prevent the market from hurting him again to avoid pain.
In other words, the more he wants to win and not lose, the less he can tolerate information that may be beneficial to him. The more information he has the ability to block, the less opportunity he can see in his favor. That is, pay attention to what attracts what, and don't let past losses restrict future transactions. Every transaction is a new beginning, don't let fear, prevent yourself from being hurt by the market, and cause you to miss opportunities in front of opportunities. Learning more and more market analysis in order to avoid pain creates complex problems because the more you learn, the more you expect from the market, and the more painful it will be if the market doesn't do it. Unknowingly, a dangerous vicious circle is created: the more you learn, the more exhausted you become; the more exhausted you become, the more you feel you need to learn.
Ultimately, the worst outcome of not taking responsibility is a cycle of pain and dissatisfaction. The way to solve the problem is to get more market information. Learning is always good, but if you are not responsible for your attitudes and opinions, then you are learning for the wrong reasons and will allow you to misuse what you have learned. Without awareness of this, knowledge is used to avoid responsibility for taking risks. In the process, it creates what you have been avoiding, creating a cycle of pain and dissatisfaction.
Think probabilistically and build good expectation management
When starting to take advantage of opportunities, do not place any constraints or expectations on market behavior. In the process of the market, the market will create some opportunities that you define or think. You seize these opportunities and try your best, but your mind is still independent and will not be affected by the behavior of the market. Once you accept risk like a professional trader, the market will never feel threatened. Very few people start trading with the right beliefs and attitudes about responsibility and risk. The market must be viewed with an objective attitude, and the market cannot be misinterpreted. There must be no pressure or hesitation when trading, and a positive attitude must be used to overcome the negative effects of overconfidence or excitement.
The core goal is to form a trader's mind. Trading starts with seeing an opportunity. If we don't see an opportunity, there's no reason to trade.
As traders, we can't get obsessed with "I know what the market is going to do" and we don't have to know what the market is going to do next. Because for any variable, even if you think it is an advantage, the distribution between wins and losses is random. We cannot predict the sequence of wins and losses, nor how much money we will make. This fact shows that trading is a game of probability or numbers. Once you believe that trading is a game of probability, concepts such as right and wrong, profit and loss are no longer important. With the right expectations in place, the market definition will not be interpreted as painful or threatening, and the emotional risk of trading will be effectively neutralized.
Maintain the consistency of the strategy and objectively confirm the advantages. This is the result of long-term experience, but the advantages are not completely correct, but only represent a higher probability. Therefore, before each transaction, you need to measure the risk in advance and be prepared for mistakes. Fully accept the risk, or forfeit the trade. No reservations or hesitation when trading on strengths, avoid associations, especially the last few deals, and remain independent and objective. At the same time, the possibility of making mistakes is monitored, and discipline is restrained, and the rules will never be violated.
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