In the early days of trading, how could one determine whether the market was going up or down? It was quite simple: just go with the gut feeling. At one point, I felt that I had a natural talent for trading, with an exceptional sense for the market. Whenever I went long, the market would rise, and when I went short, the market would fall. This feeling once made me quite arrogant in the trading market.

But later on, things took a turn for the worse. No matter what I did, it was wrong, and I kept losing money. I was so confused and disoriented that I didn't know how to judge the market trends anymore, and I was even afraid to enter the market. I had truly become fearful of the losses.

When did I start to see the market trends clearly?

It began when I established my own trading rules.

The financial market is truly vast, seemingly with its own trading rules, but they might as well not exist. They only constrain very superficial aspects, while in reality, they let people's human nature run wild within. Otherwise, how could this zero-sum game market be created, allowing a minority to take away the wealth of the majority?

I always say that if you want to see a world clearly, you must have rules. If the world doesn't have rules to begin with, then we create them.

Advertisement

Many people believe that seeing the trend means being able to predict the market movements with precision, knowing exactly whether it will rise or fall next, ideally achieving a flawless and unstoppable record. However, those who often have this mindset end up losing a lot of money, and I was once one of them.

The turning point in my trading came when I set my own set of rules in my trading world. These rules gave me a standard for defining trends.

For example, if a certain segment of the market trend meets my standard for defining a trend, I would enter the market and leave the outcome of the trade to the future. If I suffered a loss, I would cut my losses; if I made a profit, I would take it. By ensuring that my profits outweigh my losses, I would make money. Other market trends, no matter how profitable, have nothing to do with me.

What does it feel like to be able to see the trends clearly?My trading has evolved from seeking opportunities to waiting for them.

Originally, when I had no trading standards, I would turn on my computer every day and analyze market trends using various technical methods. Today I might use moving averages, tomorrow Bollinger Bands; if I felt a method was ineffective in the morning, I would try another in the afternoon. Sometimes, if I got lucky and guessed right, I would be happy all day. Other times, if I lost all day, I would be utterly dejected.

At that time, I had no trading standards, or rather, no unified trading standards, so every day was a cycle of confusion, pain, and a trap of recency bias and outcome bias. I thought I was validating the effectiveness of my trading strategy, but in reality, all variables were dynamic and impossible to validate. The so-called validation was just my "feeling."

Feeling that this strategy won't work, feeling that this technique will lead to losses, I would hastily switch, and it was always like this, feeling my way through, and the more I did it, the more chaotic it became.

Later, I discarded many "feelings" and began to uniformly and consistently implement a trading strategy over the long term. Although I still couldn't make a profit, at least the losses decreased. I started to feel a bit happier, thinking I had found the right path, so I began to control other variables, slowly adjusting parameters one by one, and then from big losses to small losses, from small losses to small profits, from small profits to stable profits, that's how I gradually made my way.

Now, I don't look for trends at all; I have very clear criteria for defining trends. A candlestick chart in front of me, and within seconds, I can tell if the trend meets my standards and whether I can enter the market. If it doesn't meet the standards, I turn off the computer and go for tea or exercise; if it does, I open a position and enter the market.

Now trading is like being a sniper, lying in wait, silently waiting for the target to enter the sniper's range, and then slowly aiming and firing.

Moreover, it's not just the judgment of trends that has become clear, including which point to enter, how to set profit targets and stop losses, what the risk-reward ratio is, how much position size to use, and the control of trading frequency, I have my own clear plan.

This feeling is like you are overlooking a maze from a mountaintop; although the path is a bit winding, you know exactly where the exit is, and it's impossible to get lost.

That's why I always say to view trading from a bird's-eye perspective, not to be obsessed with the outcome of every single trade, as it will make you directly lose yourself in the desires of human nature and be unable to extricate yourself. You need to consider trading with a holistic mindset. Many people don't understand, but those who do understand will truly start to get on the right track.In fact, it was only after entering the financial market that I truly felt the evil of human nature, the greed and fear, the selfishness and indifference. These traits are innate and difficult to overcome through one's own willpower. Just like laws, they exist to bring more order to the world. Similarly, we can also set up a barrier for our own trading to curb our human nature, and the trading results will be much better.