What logic, common sense, theory or philosophy is your trading system based on?

The widow thinks that it all lies in the word "Tao", and the natural way includes everything. What kind of indicators, models, and quantifications are used at every turn, how can this gentleman make continuous and stable profits? The construction and perfection of the relationship system has no ultimate goal, and it is not about optimization, but about the improvement and polishing of the gaps and supplements.

The main logic involved, I think~~ is objective, stable and continuous.

untrue, formal/patterned, unethical;

Unstable, to be precise, not relatively stable, it is difficult to guarantee the realization of transaction goals;

If it doesn't last, it won't go far, at best it will be short-lived.

There are many things to do to build a relationship, even including daily words and deeds. The bottom line is to understand the market and stick to the trading rules. Signals are only superficial, and strategies are even more waves. The most important thing is the practice of xinxing, including fundamental analysis, western technical analysis,

There are no special theories and beautiful techniques. I was lazy and spent a few years explaining the laws of Dow Theory. It can be regarded as a success. I would also like to express my sincere thanks to the predecessors of Dow .

I agree with Dow’s point of view below. The market can digest all news, and the price is regular. One is a unilateral trend, and the other is a shock arrangement. The trend includes main trends, secondary returns, and day-to-day fluctuations. Sorting and summarizing, dividing the change of price trend into four modes of ABCD, drawing on the evolution logic of the sixty-four hexagrams, so that the four modes are reincarnated in cycles, solving the problem of direction and position, among which the mutual conversion of trend and shock The details have also been dealt with, and the whole system allows the fluctuation of every detail of the price to have a regular trend and internal logic. Facing the impact of the news, there is no other choice but to avoid it! From the system to the stable profit, there is still a running-in process of the unity of knowledge and action, and it can be regarded as landing soon, which is worthy of joy, after all, it is not in vain to waste years of hard work!

I wish everyone a lot of money!

My trading system comes from market fluctuations. As long as the market can be structurally divided into trends during the time period I observe and participate in, I can achieve less losses, smaller losses, more profits, and larger profits. Unless the market is never volatile or never volatile enough to reach the level of my participation, then I will not be able to accumulate profits. A fully competitive market is bound to fluctuate, and I'm bound to accumulate profits, that's all.

The English trader of a trader is pronounced as "blowing". It is impossible for a trader to know how to brag. Today, I would like to take this opportunity to talk about the construction of the trading system of the sleepy home. Due to the limited space, it cannot be fully expanded, and only the conceptual ones will be discussed. Things, I don't expect anyone to understand, but friends who want to know more can pay attention to Sleepy Home and continue to share trading experience.

1. Momentum trading: energy drives prices, and momentum drives trends.

​Momentum trading is the foundation upon which Sleeper's trading system is built and the cornerstone of everything else.

▷The first self-evident theorem is that all price movements are directly driven by real funds. In addition to the funds directly entering the market, all other factors that can affect the price market are indirect, such as the international environment, financial policies, the level of the real economy, etc. All factors that can determine the direction of foreign exchange prices may be very important, but It's all indirect. Because of its indirectness, it is impossible for retail investors to understand it at the first time, and no matter how powerful its influence is, it cannot instantly affect market price changes. There are only funds for entering the market, and its effect is immediate and synchronized with price changes.

▷The second self-evident theorem is that what causes the market price to continue to develop in a long-short direction must be the net surplus after the balance of long-short funds entering the market at the same time. Funds can cause price changes, but huge amounts of funds may not necessarily cause drastic price changes, unless the reverse funds are very weak. When the flood hits the dam, it can only be peaceful. Only the net funds after completely offsetting the reverse funds can lead to a clear directionality in price development.

▷​The third article is the sleeper’s momentum theorem. The funds that drive price changes are called energy, and the net energy that drives prices to show a clear directional development is called momentum.

2. Price says it all, including momentum.

​▷Price is the basic element of sleeper trading technical analysis. In addition to real-time transactions and ever-changing market prices, all trading information, trading indicators, trading parameters, etc. that traders can access are reprocessed second-hand and third-hand Hand to N hand data. Among all means of predicting future prices, the current transaction price is the closest parameter to the future market price, and the more complicated things are, the farther away from the future they are.

​▷So, I can only use current and past market prices to analyze the momentum state of the current market, so as to get the possible direction of future market prices .

3. Trend tracking and trend pattern.

​▷ Through momentum analysis, you can get the most likely development direction of the future market, so as to get systematic advice on whether to go long or to go short. However, sleepers agree with the Zen master Luntang's "unpredictable and predictable". For the future market, they can only predict its development space, but cannot judge the direction. Although there is a direction when placing an order, there is no direction in mind. After placing an order, use the method of trend tracking to judge whether the direction of the order is correct or not. The principle is that if the trend in the participating direction can be formed or continued, it is a correct order. If the trend in the participating direction is aborted or reversed, it is a wrong order. Use the pressure level and stop loss level to judge where the spatial node of the market development is, and that is also the focus of trend tracking.

​▷ The method used by trend tracking is the trend form. The sleeper said a lot in the previous article, gestation, occurrence, continuation, failure, reversal, five forms , enter the market when it occurs, and build a position when it occurs, and firmly hold the order when it continues. Reduce positions when exhausted, leave the market when overturned, clarify the shape, and operate strictly. ​

4. Type quantification, unified technical analysis

​​▷ In the face of the same price quotation, different traders often come to different trend judgments, because there is no uniform and quantifiable price analysis standard. It is a necessary work to establish a trading analysis method to quantify the price form and give a completely unified trend judgment standard by using typing. In my system, I directly apply the central theory of Zen Zhe Luntang, and simplify the processing.

▷ There are only two price patterns, continuation and reversal. Use independent K-lines to judge, as long as there are at least two K-lines to form the continuation pattern, and the high point and low point of the second K-line are higher than the first one, it is a long continuation, otherwise it is a short continuation; if K Line 1 and K line 2 are the continuation of long positions, while K line 2 and K line 3 are continuation of short positions. These three K lines form the simplest reversal market from long to short. It is worth noting that the harami formed by gapping is a special case, neither a continuation nor a reversal. In the classic K-line theory, a harami is generally regarded as a signal of a possible reversal, but according to my observation, the market continues after the harami is more likely, so I generally classify it as a continuation category.

​▷ ​Through price classification, even complex market conditions will be decomposed into two turning points and a connecting line between them, which are called pens and line segments in tangling theory. Regardless of the two inexplicable names, they are two turning points and a line. Wire. Therefore, the simplified definition of the center is also very clear. The overlapping part of any three consecutive market quotations is a center. The simplest center is two long solid lines sandwiching a pregnant line. The slightly more complicated one is the so-called lightning line. , so friends who equate the center with the shock range will be completely wrong.

​▷ ​​Using the center to define the trend, there is only one trend, that is, a new center is formed after the price leaves the center range. The simplest trend is two connected Lightning Lines, where the second Lightning Line's retracement low is higher than the first Lightning Line's turning high. If the callback point of the second lightning line is lower than the turning high point of the first lightning line, it can only be judged that the center formed by the first lightning line narrows, rises, and continues, and no new trend is formed.

5. Moving average and MACD

​There is a big difference between a sleepy man and a Zen man. I just use the price pattern to track the trend, not as a basis for entry. Many friends who have studied Zenglun for a long time have not been able to clearly find the three buying and selling points as Master Tang claimed. Perhaps these three points do not exist at all, or they just exist like an afterthought. The entry point of the sleeper is the momentum breakthrough point, that is, the MACD column line crosses the 0 axis, and at the same time the price crosses a certain moving average, such a clear price action to judge the entry point. The momentum breakthrough point is generally located after the previous trend reversal point and outside the new trend breeding area. It is the point after the trend has clearly occurred but has not yet been confirmed to enter the continuation state. The exit point is the trend exhaustion area, which is composed of MACD and price patterns. Judging from the deviation form, the absolute factory point is the breakthrough point of reverse momentum, and there are clear price form standards, which anyone can see at a glance.

6. ​Risk priority, position with stop loss.

​A sleepy person makes a transaction, and if there is no profit, the stop loss is calculated first. The stop loss has a technical stop loss point and an absolute stop loss point. The technical stop loss point is the break point of the entry trend price pattern. For example, if the momentum breaks through and then reverses quickly, for example, if the price leaves the trend breeding area and then turns around and returns to this area, the loss should be stopped. The absolute stop loss point is 1% to 2% of the trading account. In any case, if the loss reaches 1-2% of the total account, the loss must be stopped unconditionally. The total position is judged based on the absolute stop loss amount and the reverse point where the price pattern is destroyed. If it is calculated that this order must be made with a very light position, it means that the current point is risky and it is not suitable to participate.

Seven, two and one

​According to the question of this topic, if the sleepy person blows something mysterious, if you understand what you don't understand, you will be a lively person.

Perhaps the Zen master Lun Chan concealed his true perception. Although the Sleepy Master admired Master Tang very much, but just based on his articles, I firmly believe that his understanding and development of Zen is only at the level of Yehu Zen. The key to the sleeper's momentum trading system is to regard the two seemingly causal two things, price changes and capital in and out, as a phenomenon with the same cause and effect. I originally wanted to rely on capital flows to predict price changes, but now I have to use price changes to infer capital changes, and then predict future price changes. The father is the son, and the son is the father.

This is actually a "circular argument" that the Zen Master dislikes and even despises extremely. Buddhism is a non-dual law. There is no order in Buddhism. How can cause and effect be two? Is there any order of cause and effect? Mathematical science is the law of the world, the law of dichotomy, and the law of order. It is impossible for mathematical science to explain circular arguments. This is the dead end of natural science. But Buddhism is one, cause and effect are one, there is no sequence, no order, no one causes another, and no one originates from another, naturally there is no so-called "circular argument".

Funds enter the market and the price rises. Then when you see the price rise, you must know that funds have entered the market. Who is the cause? Who is the fruit?

Participate! ​

The market exists objectively, and trading is the interaction between oneself and the market. The essence is that subjective consciousness adapts to objective fluctuations. Therefore, the trading system is exclusive to oneself. It is based on understanding oneself and understanding objective fluctuations. The essence is the way one deals with objective fluctuations. The essence of profit is the return of subjective consciousness matching objective fluctuations.

Objectivity is like a rushing, ever-changing river. What we need to do in trading is like taking a ladle of water from the river. We didn't fit with the big river, so we stopped and waited on the bank. If we forcibly fetched water at this time, we would be swept in by the big river and drowned.

We must understand three points clearly, the characteristics of the market, our own characteristics, and how we interact (trade) with the market. Only in this way can we achieve subjective fit and take a ladle of water, and stay on the shore if we don’t fit. The trading system is how you interact with the market, but in the process of establishing it, you need to have an in-depth understanding of the characteristics of the market and your own characteristics.

Market: Price changes <—long-short power <—fund game <—people’s opinions <—objective changes <—the rules of everything.
Changes in prices are caused by changes in long-short forces. Behind the changes in long-short forces is the game of funds. Behind the game of funds is emotional views. Emotional views are caused by changes in fundamentals. Whether it is price changes, people's hearts or fundamentals, They are all manifestations under the rules of the operation of all things. Layer by layer deeper and more stable. What's the use of knowing this? This is the root of various trading methods.

What are the rules for the operation of all things? It is junior high school physics, high school Ma Zhe, Lao Tzu's Tao Te Ching, and so on.
Everything is a combination of macroscopic certainty and microscopic uncertainty (in Ma Zhe's words, the relationship between chance and necessity). A novice will think that the market is deterministic, an entry-level novice will realize that the market is uncertain, and a veteran with stable profits will understand and deal with the macro-certainty and micro-uncertainty of the market with ease.

What is macroscopic certainty? Trends and shocks will inevitably change.
What is microscopic uncertainty, people cannot determine when and where shocks turn into trends, when and where things are extreme, and when it is the end of the battle.

The macroscopic certainty builds the core of profitability, and the microscopic uncertainty creates patches of the profitable core. Just like a car, the core is an engine that drives four wheels. Although the core alone can run, the direction, speed, and safety cannot be controlled. It is necessary to add a steering wheel, brake, and accelerator. These are patched on the core. Respond to various market conditions and suit yourself. If you use it for competitions, you can make it into a racing car, and if you use it for off-roading, you can make it into an off-road vehicle. The core remains the same, but the patches change with you.

Trading system: operating rules, trading tools, technical analysis <--trading ideas <--trading principles <--trading philosophy <-- understanding of the market, yourself, and trading (that is, the interaction between the market and yourself). Layer by layer deeper and more stable. Just like the operation of the market, it is also the performance under the rules of the operation of all things.

Everyone knows the meaning of physics in junior high school and Ma Zhe in high school, but they can't get a ladle of water from the market. Ideas need to be implemented in trading principles, ideas, and operating rules. Methods and specific rules need to be realized, and form a harmonious whole. Most people can't do it. This is not something that can be learned, but it is practiced for many years. Gradually, this knowledge turns into thinking, and then into operational behavior. At this time, knowledge and action are integrated.

The purpose of the unity of knowledge and action is the unity of nature and man. What is harmony between man and nature? Add clothes when it’s cold, cool down when it’s hot, eat when you’re hungry, and sleep when you’re sleepy. The market changes and your operations change accordingly, instead of thinking that you’re capable enough to withstand cold and heat and endure hunger. Sleepy, compete with the market for a loss and scold the market.

Going in harmony with the sky, the unity of subjectivity and objectivity is the unity of man and nature. Of course, you must also understand that your abilities are limited, and it is impossible to be one with the objective all the time.

The unity of knowledge and action, the unity of man and nature, forgets the self.

It's really not too complicated. It is true that sometimes it is necessary to count the market price of each month. My transaction is to analyze and predict the market trend

I always wait for the market to come out and follow the market, and I can't predict the market in advance

It is the logic of trading thinking that objectively follows the market trend and follows the trend! Simple, easy to understand and easy to operate is too simple, causing many traders to be unbelievable, so very few people make money in this market... because people who make money in this market are simple thinking, and there are no overly complicated ideas!

Most people would rather believe the recent trading results than the trading logic behind it.

Many people only focus on whether their trades are profitable. They believe that winning trades are right and losing trades are wrong. Don't care about the transaction logic behind it at all. In fact, professional traders are more concerned about trading logic. If the logic is correct, it is right to lose money in a single transaction. If the logic is wrong, it is also wrong to make a profitable transaction.

For example, deadweight at a loss. Many people really came back after fighting to the death. When the result is favorable, they will think it is right, and on a certain day, a wave of reverse trend market will never return, and it will bring him back to before liberation. There are many people who get short-term gains because of luck, and the result is to reinforce their own trading behavior patterns, which ultimately lead to their failure.

Most people have a preference for results, especially in an uncertain field like futures foreign exchange. Therefore, in the trading field, there is always a market for bragging. Because making money is great, whoever makes money is a master, and whoever makes money several times a month is a top master and a master outside the world. This is the way most people think.

But really smart people are on the contrary. They need to look at both the results and the trading logic behind them, because in this uncertain and leveraged field, the results are very accidental, and the trading logic has real stability.

For a daily trader with a capital utilization rate of 60%, is a 20% retracement a big deal? Is it necessary to have 0 retracement in a year and then gain N times to be a master?

Why is 60% a position? Don't you want higher income? And aren't high returns and big retracements inevitable?

Lin Guangmao, who remembered the rise of cotton futures back then, said in an interview: In his cotton market trend, the maximum retracement once reached 70%. In terms of floating and taking back, he once gave some examples vividly: some people are very scared in the roller coaster, but when you ride the roller coaster every day, you may be sleeping.

Because he often undertakes a large retracement, he dared to make a profit and increase his position later, which led to the amazing record he created later.

Unable to bear any retracement but wanting to obtain super high returns, this is actually the greed of traders in the final analysis.

The avenue is as simple as it is easy to know but difficult to do.

Any trading system that has been put on the table has stable profitability, and it is impossible for a trading system that has failed itself to be pushed in front of many traders. For example, the simplest long upper (lower) shadow line trading method, if executed well, can definitely make stable profits. However, the weakness of human nature determines that there are very few people who can make stable profits. Therefore, the comparison between systems is the extent to which the operation can be rigidified to reduce the requirements for human nature. The deeper the degree of rigidity, the stronger the profitability.

Therefore, the establishment of a trading system should be as rigid as possible, reduce the mentality, and even work hard to skip the mentality. Don't simply seek a systematic method. No matter how good the method is, it cannot help build a rigid and stable mentality. Without rigid operability, it is equal to zero.

This question is very powerful. People who can ask this kind of question are not far from making money steadily, because the logic of thinking is already on the right path.

Specific trading systems have to be established by themselves, but the basic logic is the same.

First of all, how is the foreign exchange graphic trend formed, um, yes, it is formed by capital transactions. Secondly, why are the funds sold and hyped, and what is the reason? Well, yes, because of the expected consensus, which is the story.

For example, Brexit, a good story is like a pile of stinky shit, a swarm of flies swarms, so the pound is big and fragrant. Another example is the quarrel between Tsarist Russia and the crude oil explosion. Do you think there is a story behind every awesome market? If there is no story, why should I, Big Wall Street, throw money at you? Is it because other shit doesn't smell good or your color is very special?

Well, then the expected consensus and good stories guide the capital movement, and the capital movement forms a technical graph. This is the basic principle. After that, a trading system that conforms to the basic principles is slowly established on the graphical k-line trend. No matter what type of player you are, you all start from this basic principle.

My trading system is based on the essence of the market, starting from the people participating in the market and the nature of funds, and is built through rigorous philosophical and logical thinking. Every analysis is logical reasoning and conforms to market principles. Such an analysis method Only then will we get definite results, so as to find definite trading opportunities

My trading system is a computer-automatic intelligent trading system realized by a self-developed core algorithm without manual intervention.

The system has realized different trading varieties and investment targets, after intelligent filtering, automatically adjusts parameters, is oriented by fund management and risk control, and obtains a trading system with excess return algorithm as the core.

The old-fashioned things are probably not the best choice. Whether it is the current theory or thought, most of them are a kind of thinking that the existing Western literature wants to cultivate everyone. Over time, it becomes the target of harvesting. There is nothing inevitable in the market. Laws, if anything, can only find relatively repetitive historical moments in relative chaos as the only basis for short-term interests...

According to historical data statistics, it depends on the set of big and small communities.

basic law

Combination of multi-cycle and multi-tools, coupled with execution and self-confidence

Harmony - Synergy between signals and trends, time and space, fundamentals and technical aspects, psychology and technology

The average return of several foreign exchange varieties on the fixed period and fixed average

1 hour cycle level, you can go to MT4 to see

Start with a few basic assumptions axioms. I personally like the Euclidean axiom-definition-theorem research ideas.

I am more skeptical of the profit points found based on statistics. The part of my thinking that involves statistics only involves refining appropriate parameters at a certain point in time, rather than discovering laws.

Simply put the logic chain:

1. There must be fluctuations in the market (the law of the game) (statistically refine the parameters of the stage volatility)

2. Fluctuations have directional inertia (the law of inertia) (the first basis of advantage)

3. There must be driving-adjustment structure for directional fluctuations (adapt to the basic price mode of all varieties)

4. From the perspective of "phenomena", define the form to characterize the development of the market (the second basis of advantages)

Both theory and logic are based on deduction. The inductive method is not used because of the long-tail effect, because once an extreme market occurs, the inductive method will be invalid, and the logic or conclusion derived from the deduction will not cause problems. Unfortunately, almost all of the answers so far below this Q&A are from a statistical perspective. Statistics are just the result, not the cause, an expression of quantity, like an indicator. The possible reason for not deducing from the original point is that traders do not have a deep understanding of the market. What they understand is only the superficial phenomenon, and they have not explored the reasons behind the phenomenon.

The second is that the deductive method is too difficult. After all, most people cannot understand the essence of any thing, let alone the financial market.

The third is that the induction method is easy to draw many conclusions, and has a certain range of validity, so as to benefit from it. However, as the market changes, the generalized method will become invalid. Traders have to do market research from scratch. On the contrary, it is difficult for the deductive method to fail. Just like mathematics, all existing conclusions start from the assumption 1+1=2, and 1+1=2 is the foundation of artificially stipulated mathematical logic.

Therefore, there will be no big mistakes in the existing mathematical conclusions, and they are called theorems. Theorems are deduced from axioms through rigorous logic. A theorem never fails unless human logic changes. On the contrary, physics is different. The fundamentals of physics become laws. The meaning of the law is that it will change according to different conditions, that is to say, it has a scope of application, and the law fails beyond the scope of application, such as the theory of relativity and quantum mechanics. Even without considering such profound theorems, the simplest ones such as the phlogiston theory, which was the theory that described the combustion of matter in the past, can also explain some problems. Oxygen was discovered later, and the oxygen theory can better explain combustion.

It's like I found a trading system where I could earn 10% a year, and the later system could earn 50% with less risk. See also the evolution of lead-acid batteries, nickel metal hydride batteries to lithium batteries.

Markets are volatile.
If it rises too much, it will fall, and if it falls too much, it will rise.
Big swings turn into small swings, and small swings turn into big swings.