How can retail investors maintain their mindset and cope with market manipulation?
To be honest: Retail investors lose money not because of market fluctuations, but because of a loss of control over their mindset. The purpose of market manipulation is never to help you make money; it’s to wash you out, making you sell at the lowest point and buy at the highest point.
You see them oscillating back and forth, fake breakouts, and fake breakdowns; in reality, it’s just two words: "psychological warfare."
How should retail investors respond to market manipulation?
First: Before entering the market, ask yourself, "Are you here for short-term trading or long-term trading?"
If you are a short-term trader, strictly follow technical stop-loss rules. Accept the loss and come back for the next trade.
If you are a swing trader or long-term investor, don’t let yourself be swayed back and forth in a volatile range. Set a larger stop-loss range for yourself; unless a key support level is broken, hold your position.
Second: Don’t be swayed by intraday fluctuations; look at the larger time frames!
The most common tactic in manipulation is: intraday charts plummeting hundreds of points to make you panic, after which they pull it back up within half an hour.
Therefore:
Before making trading decisions, at least take a glance at the 1-hour, 4-hour, or even daily charts. Don’t let a few minute candlesticks scare you out of the market.
Third: Firmly execute your plan without deviation.
The most terrifying thing is not the decline, but: if you adjust your stop-loss after a slight drop, or change your target after a slight rise,
In the end, all your plans will fail, and your trading will rely solely on emotions.
A well-formed plan, even if wrong, is still a dignified mistake. Once you start randomly changing stop-losses, chasing trades, or fighting the market… to put it bluntly, you are already being led by the market manipulators.
Fourth: Position size determines mindset.
Most retail investors cannot withstand market manipulation, and the fundamental reason is that—your position size is too heavy! A smaller position size naturally leads to a steadier mindset. Leave some margin for error in your account,
You will find: no matter how the market oscillates, it will not shake you out.
Fifth: Recognize a fact.
Market manipulation is not meant to make you lose money; it’s to make you hand over your chips voluntarily in a state of emotional collapse. As long as you stay steady, keep your position manageable, and execute your plan, they will wash out others in the end, not you.
In conclusion: Market manipulation is not scary; what’s scary is when you wash yourself out of the market.
In this market, it will always be: "a few win against the many." If you want to be among the few, first learn to control yourself.
