The Huihu platform organized an offline event, and Mazhao was going to join in the fun. Looking at the event flow, the big names are in the front, and the hemp claws are in the back. A big coffee is like a star hotel, although it is tall and elegant, Mazhao is like a fly restaurant, fortunately, the quantity is sufficient and affordable. The following is the first part of the speech draft compiled during this period. It is called "Essence of Establishing a Trading System/Trading Technology". Many friends who like Mazhao may not be able to attend the scene due to mundane affairs. Mazhao first posted it for readers.
Mazhao talks about "trading system/trading technology" because many traders, including me, will equate the two as one intentionally or unintentionally. In fact, trading technology is only a part of the trading system, but it is the most important part. The other two elements of the trading system, "fund management" and "trading psychological exercise", are determined according to different trading techniques. Because trading technology represents your "three views" in the trading world, and is the basis for all other learning and discussions. In fact, trading technology is based on completely subjective judgments, not technology but art.
Therefore, the logic of trading technology is only the logic of the trader himself. This logic must be self-consistent and harmonious. To build a complete trading logic system, at least the following four steps must be solved:
①Basic elements of market conditions - a single transaction price
represents your depth of understanding of market price behavior, just like scientific understanding of matter, from molecules to atoms, from atoms to neutrons, protons, electrons, and even quarks , leptons, bosons and the like. The same goes for the market conditions. Novice traders only see the market fluctuating like waves and are unclear. Therefore, if you subdivide it a little bit, there will be one, two, three, four, five waves. If you go deeper, you will see various K-line combinations, unilateral and reversal, and trends. And shock, and then you can observe different technical indicator signal points.
A single K-line pattern is the most basic element that most people can recognize, but they ignore that the K-line is also formed by four price parameters plus two time nodes. This is the "suffering" mentioned in Tanglun, but it is not enough. In fact, the basic elements of market conditions are single transaction prices one after another. If you go deeper, you need to study why traders trade at this price point, which is not the job scope of chart analysts. Therefore, for any trader who uses market charts as an analysis method, the most basic analysis element is the single transaction price. Its practical significance is that traders should observe the K-line chart with continuous thinking, and be able to see the development trend of the daily chart from the five-minute chart.
② Judgment of market patterns Luo Ji—Trend development model
In fact, everyone has a set of market pattern development models in their consciousness, but most of them are incomplete. When a certain price combination or indicator combination appears, you will subconsciously determine how the subsequent market will develop. You are by no means alone and certainly not everyone thinks so. The so-called trading according to the signal is by no means strictly in line with the scientific theory of causal logic, what is gained is probability.
We have all heard of a trader who used to "eat the sky with one trick", because during that period of time, his winning rate for that trick was particularly high. But the market will always change, and there is no trading signal that can maintain a high winning rate from beginning to end in financial history, so we must change from relying on trading signals to relying on trading systems. The so-called system must have a complete set of market pattern judgment logic, that is, a market development model that is completely your own.
For trend traders, you must be able to completely judge where the trend starts and ends, and you must be able to judge at a glance which level of trend the current market belongs to and which stage of the trend, and this standard must be universally applicable and self-explanatory. In this way, no matter how the market develops, you will not get lost.
③Logistics of the development of market conditions—tracking rather than forecasting
After having a market model, traders need to solve the problem of the relationship between themselves and the market. Objectively speaking, traders are market participants, but the vast majority of retail traders are actually just bystanders, because your personal participation has no impact on market conditions, and the market trend is not affected by any individual trading participation or personal emotions. change. People who believe that trading is different from gambling are simply too confident that they can control the market.
Although traders are engaged in the business of forecasting, they cannot have the mentality of forecasting. This is what is called "unpredictable and predictable" in the theory. I believe everyone has this kind of experience. Every time you think that you are very sure, it is almost always when you lose your underwear. This is the result of predictive psychology. But traders must have expectations, and at the same time have a God's perspective, pay close attention to the market, and judge whether the previous expectations are realized based on the current market situation. If your expectations don’t exist, it’s a fantasy to stay. It’s like gambling. If you refuse to hand over your chips after all the cards are drawn, then the thugs of the casino will come to greet you.
④ Luo Ji that drives market development—Momentum drives
the market market model is dead, you must have a reason to convince yourself why it is going this way, so that you can strengthen your confidence next time the same sign occurs. The vast majority of traders and analysts are hindsight. After every big ups and downs in the market, there will be a lot of people giving ten or eight reasons, but they are not eggs. Of course, Zhuge Liang gave a lot of analysis and predictions beforehand, but they always win less and lose more, which is very random. The market development driving theory given by Mazhao is the principle of momentum driving. Simply put, if the market is already like this, it will probably continue to do so. The most likely timing of the market launch can be judged by the movement of the MACD pattern and the price moving average. The specifics have been mentioned in Ma Zhuo's earlier composition, so I won't repeat them here.
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