The first level is when you are completely confused and don’t understand anything about the market. This stage is like “seeing mountains as mountains and water as water”. If you see a positive line, it means it is rising, so you should go long. If you see a negative line, it means it is falling, so you should go short. It is normal to lose money, and it is also normal to make money. This is the stage of gambling on luck. The key word at this stage is “excitement”.
At this level, some traders who are determined to engage in speculative trading begin to understand that trading without thinking will always lead to failure. The low threshold of speculative trading is only reflected in the amount of money, while trading technology has a threshold and it is impossible to succeed without learning.
So, they began various activities such as reading, joining groups, and seeking mentorship. In short, they started to systematically learn trading techniques, which they termed 'building a trading system.' During this process, they occasionally encountered some fundamental aspects of trading and sporadically sensed fragments of knowledge from some experts online. They may have also paid to participate in some high-quality training courses.
They entered the second level of trading: 'A mountain is not a mountain, water is not water.' They have realized that the market is not as simple as it appears on the surface. They understand more and more, and have started to establish rules for their own trading. However, on the internet and in printed books, there is very little written by truly successful traders. Most of the material remains at a theoretical level, and much of the theory is incorrect and lacks practical applicability. Even when some experts occasionally share core insights, many people find them completely incomprehensible, or even if they seem to understand, they cannot apply them to their own practices.
Most people in this stage will go through a long period of time, wandering between heaven and hell. They seem to understand everything and know everything, but still end up losing money in practice. In fact, traders at this level have two significant issues: First, most people have never seen how truly successful traders operate; everything relies on imagination. For example, in the last round, everyone saw the successful trades of Fatty, Tony, and Bitcoin King, but what were the specific trades? What specific methods did they use? Nobody knows... and how did they trade during the other years? Nobody knows... This leads many to imitate the methods of experts, but in fact, they are only scratching the surface, causing imitators to repeatedly encounter setbacks.
Second, while they know a lot, there is very little that is genuinely useful, and many of the concepts are incorrect. Thus, they linger, entangled, and hesitant amid various constructions and demolitions. This stage is actually the most painful; it seems that every action is executed according to 'doing the right thing,' but the results are always wrong. After much research, they still cannot discern what is right and what is wrong. The key word for this stage is 'despair.'
So, some people begin to simplify, discarding those ambiguous pieces of knowledge and reasoning. They continually refine their systems, summarizing particularly useful patterns from profitable trades, constructing simple and effective trading systems, training their control abilities, and strictly executing according to system signals. 'A single skill' is finally mastered.
At this point, trading enters the third level: 'A mountain is still a mountain, water is still water,' but this mountain is no longer that mountain, and this water is no longer that water.
They can generally understand the market. At this stage, self-control is crucial; technical skills are no longer the most important. They are very clear about the importance of systems, honing 'a single skill' to perfection, familiar with patterns and scenarios, repeatedly capitalizing on opportunities they have profited from before. They can restrain their hands and have developed sufficient respect for the trading market, willing to abandon all trades outside the system. The key word for this stage is 'treading on thin ice.'
At this level, trading can be considered successful. All signals outside the 'single skill' system are abandoned, and they have trained themselves to wait patiently for the best trading opportunities to appear. This means they have become proficient, as making money is no longer difficult, and the market has become their ATM.
Finally, some top experts enter an even higher fourth level - 'No mountain, no water, no tricks, no forms.' Traders at this level deeply understand the core logic of market operation, having transcended technical constraints in their operations. They have established a philosophical system of 'Dao,' where all actions in the market can be explained by 'Dao.' They begin to make money through logic, while technique becomes an optional tool. This group of people are the true 'scythe of chives.' The key word for this stage is 'light clouds and gentle breeze.'
The progression of a trader requires taking it step by step. This market does not have genius players dropping from the sky. Every successful trader's journey involves heartfelt struggles and unforgettable pain. They will make all the mistakes they should make and fall into all the pitfalls they should fall into. Therefore, it is normal for newcomers to continuously lose money and for veterans to struggle for years without making profit. Very few traders can enter the third level, and even fewer reach the fourth level.
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