Reverse Thinking to Play with Currency! The Stable Profit-Making Strategy of Experts
What can survive is definitely not some indicators, news, or trends, but human nature and the game of trading. Only by understanding these can one remain undefeated.
Point 1 (Trading Psychology of Human Nature)
It is often heard that trading goes against human nature. Most people think, 'If I make a profit, I will exit; I'm not greedy. If I lose, I will hold on and not admit it.' Reverse this, and you become an expert. If you think, 'If I make a profit, I will hold on; I won't exit unless it's a 20% gain. If I lose, I will run; I'm not greedy; I will run after a 1% loss.' Strictly maintaining this mindset can last a lifetime.
Point 2 (Martingale Trading)
Martingale trading means: run when you make a profit, and add to your position to lower the cost when you lose. Since most market trends are dominated by fluctuations, Martingale trading has a high profit-loss ratio. Martingale is the only trading strategy that aligns with human nature, which is why many people like to use it. However, it can lead to disaster in a one-sided market, resulting in liquidation. Therefore, Martingale should definitely not be used. But you can do the opposite: if you lose, you run; if you gain, you keep adding to your position, and continuously adjust your stop-loss. After perfecting this method, you will discover that it is the pyramid adding method of the trading giant Jesse Livermore, which once turned upside down the entire beautiful country.
Point 3 (Loss Aversion and Gambler's Psychology)
Everyone understands the gambler's psychology: when they lose, they want to recoup their losses; when they win, they want to continue. I believe that most people can trade without being greedy for profits and can easily be satisfied. However, when they lose, they want to recoup their losses; everyone is like this. This behavior is referred to in the industry as not being greedy for profit but greedy for loss. Reverse this. By going against human nature in trading, you will quickly become a big player. Loss aversion occurs after a period of frequent profits when one is unwilling to accept a drawdown. This situation also conforms to human nature, so if you don't go against it, you won't earn money.
Conclusion:
This method of going against human nature is definitely useful. Trading ability is a skill, not knowledge; just because you understand it doesn't mean you can use it. It requires continuous practice and operating based on experience. Therefore, just learning is useless; you must practice. How to use it? Use your own real money to practice, constantly summarizing experiences and mistakes. (Note: This is just a method; use it if you find it suitable, and don't if it doesn't fit.)
