The Five Core Disciplines of Trading

1. Emotional Management

• Score your emotional state before each trade (1 to 10).

• If your emotion is below 7, avoid trading.

• Remember: Do not let FOMO drive your trades.

2. Risk-Reward Ratio Control

• Only engage in trades with a reasonable risk-reward ratio.

• Set target risk-reward ratios as: 1:1.15, 1:2, 1:3, 1:5.

• Abandon opportunities below 1:1.15.

3. Position Management

• Divide total positions into multiple shares: 5 shares, 10 shares, 20 shares, 30 shares.

• Build or reduce positions in batches according to different confidence levels and market strength.

• Avoid putting all your eggs in one basket; only use a portion of your position at a time.

4. Stop-Loss Discipline

• Maximum stop-loss trades per day: 3 times.

• After reaching 3 stop-losses, forcibly stop all trading for the day and take a break to adjust.

5. Trading Plan and Cycle

• Clarify the cycle and rhythm of trading.

• Use a combination of: 15-minute charts, 4-hour charts, and daily charts to formulate trading plans.

• Enter trades on smaller cycles, confirm trends on larger cycles, and avoid blindly chasing prices.