Trading can be summed up in 16 characters,
The way of the universe is simple, go with the flow, cut losses in time, and let profits soar,
The way of the universe is simple: rising is rising, falling is falling. Judging rises and falls is very easy. If the moving averages are going up, it's a rise; if they are going down, it's a fall. It's that simple—don't think too much.
Going with the flow means going long when it’s rising and going short when it’s falling. It’s not that going long when it’s rising is always right; it's not about being right or wrong, but about the magnitude. When it rises, the greater probability is that it rises significantly and falls little; only significant movements yield significant profits.
Cutting losses in time means that if you’re wrong, you need to cut your losses.
Letting profits soar means that if you’ve made a profit, you need to hold on to it.
In reality, most people lose money by doing the opposite: analyzing this and that, going against the trend, running away quickly when they make a profit, and fighting hard when they incur a loss.
Everyone who makes a lot of money typically relies on these sixteen characters to earn it. This model is often unprofitable because big market movements are not common; it goes against human nature. Once you have it, you can ride it from start to finish, and if you do it twice in life, you’ll become wealthy.
Trading is simple, but it's hard to do. I often watch and think about it myself.
Tonight, the CPI data will be released. Will the market continue its bullish trend? The team has already published the script; we’re waiting to reap the rewards.
