Fry in foreign exchange, these hurdles can't be passed, and your skills are ultimately a loss!

We always hear people say that trading requires understanding, so what do you need to understand? In fact, most people don't know at all. Today, I will talk to you about what else we need to understand in addition to technology in order to make money in the trading market.

Since I entered this industry until now, although my qualifications are not too deep, I have seen a lot of people in the market, such as great people, weirdos, and strange people. Anyway, in the final analysis, there are only a few who make money, and most of the others are at a loss.

To this end, I also made a special statistical survey, that is, the difference between those who make money and those who lose money, and finally came to the conclusion that those who lose money do not lose money because the technology is not good, but because the technology is too good. Here I am not saying that technology is not important, but I hope that everyone can understand that technology is actually transparent in the trading market. Whether it is the theory left over from history, the trading system is nothing more than a few, as long as everyone spends a little money to buy a few books, it can be done, but according to different people, the ability to understand is different, and the conclusions are different. Technology is really not that important. If it is important, I will at most give technology a 10% proportion. Some things other than "technology" are the most worthy of our consideration.

However, the "outside" thing has to be divided into several levels, each level corresponds to a hurdle, and each hurdle may require you to "face the wall" for several years or even ten years to get through.

What are the hurdles?

The first hurdle: stop loss

Stop Loss Who doesn't know, so what exactly is a stop loss? My personal understanding is that I lose money and lose money, and then cut myself with a single knife.

Simple to say, is it the same as daring to cut the warehouse?

Martial arts, the first style of Sunflower Treasure Book, if you want to practice divine arts, wield a knife and stop losses, although it has nothing to do with learning Sunflower Treasure Book in Xiaoao Jianghu and playing with the palace, but the palace is indeed a prerequisite for learning the treasure book.

So, how can we really cross this threshold?

Suddenly one day, your heart is as clear as a mirror, and you actually realize that you will never be liquidated by a sudden loss or a wrong operation. At this time, this hurdle is considered so-so.

But after passing this hurdle, you will soon find that your losses have become so regular, so stable, and the equity curve is like a shy girl looking down at a 45-degree angle for meditation and worship. This is simply a kind of death rhythm. You can even predict when you will stop your losses according to the laws of your capital curve.

So far, although the market can no longer hack you to death with one knife, it can delay you with one knife and one knife. This is the final outcome, sad!!

Did we just die like this? That's not the case, the Buddha said: Nirvana rebirth, I don't go to hell, who goes to hell, who doesn't go to the tiger's den, how can I get a tiger's son...!

Second hurdle: take profit

Everyone knows about take profit, so what is the real take profit? Continuing my understanding is to make a profit, make a profit, and then click a knife to drop the bag for safety.

If your rhythm is always at take profit and take profit, then congratulations, you are really unable to pass this hurdle. What is the point of this hurdle? That is not taking profit.

When you learn not to take profit, you can truly pass the level of take profit. What kind of shit logic, what kind of shit?

Why is it necessary to learn not to take profits? This question goes back to a classic phrase handed down by the great traders in history: "Cut losses and let profits run". Is it a very familiar concept, is it a concept that you have memorized since you first started in this business?

So, how can we overcome this hurdle?

First of all, you have to pass the stop-loss threshold, and under the premise of really not taking profits, there will be a period of time in the process (it may be a few months, it may also be a few years) where you will find that your capital curve is no longer down, but has been looking at it head-on, has been in the initial equity buoyancy, not making much money, nor exploding losses.

That is to say, although you don't make much money, you won't lose a lot of money. You are the "playing with" in the market! So far!

If you still don't understand how it is possible not to lose money if you see this? OK, you are still far from this hurdle!!!!

The third hurdle: focus

In the trading market, those excellent traders all have one thing in common, and that is "focus". Why is focus one of the essential qualities for traders? Because "focus" is one of the essential qualities to do anything well.

Basically, all traders who have suffered losses in the market will reflect on their shortcomings and start searching for the Holy Grail, such as technical analysis methods that can predict all market movements.

At this time, the average person's process is to read a lot of books first, and then understand some indicators such as Bollinger Bands, MacD, moving averages, looking at some theories such as Dow, waves, entanglements, turtles, chaos, etc. After reading it, some newbies will feel like they have won a treasure. They have tried them all. Generally, it doesn't take long for one to move on to the next. As long as there is a loss, they will feel that it is not a holy grail to change, and the result of changing them is that they feel that none of them are easy to use, and none of them are well-learned.

This is the manifestation of a lack of focus. The sign of crossing this hurdle is to realize the previous mistakes and then start to focus on the single most suitable analytical method for yourself, so as to lay a good foundation for the formation of your own trading system in the later stage.

Fourth hurdle: single-mindedness

We trade in the market is actually equivalent to falling in love with the market. Most successful traders are very single-minded. They will not be easily swayed in the face of various temptations.

When you find yourself falling in love with a certain breed and are very familiar with its fluctuations, it will mark that you have passed this hurdle.

The fifth hurdle: capital management

The four words of money management are simple to say, but according to transaction statistics, most people cannot achieve a good money management in practice. Among the friends around the author, there are not many with good skills, but they do not make money. What is the reason? It can be summed up in four words "money management". Most people believe that only large funds need to be well managed, and there is no need to manage tens of thousands of small funds. Some people even want to use a penny as two cents, fill the warehouse every day, and kill the whole warehouse.

Let's not talk about whether you are a big fund or a small fund. When you don't know how to manage money, you will soon find that it is easy to take a light position when the market is favorable to you, and it is always easy to take a heavy position or even a full position when the market is unfavorable to you.

No matter how well you control your trading skills, the small stop loss of the heavy position and the big take profit of the light position will eventually wipe out the profit. As a result, you will become a "participant" in the market rather than a profiteer, which is what we often call "one profit, two flat, seven losses".

What makes good money management?

When the market moves from unfavorable to favorable, your position should theoretically be gradually changed from light to heavy. When the market moves against you, your position should be continuously reduced, indicating that you have started to manage your money.

As for how to do it? This is a serious academic question, and this article is obviously not enough. I will focus on it next time.

After passing the level of fund management, it will bring you the following benefits: the capital equity curve is always flat when retracting, and the curve will be more urgent when pulling up.

An important feature of passing this level is: slowly lose money when there is no market, and once there is a market, it will explode. At the same time, I see another risk in the market. In theory, if the market does not appear, I will also have the possibility of liquidation.

Time is too busy to write here first!