When it comes to contract trading, I personally believe that fundamentals are useless because most people do not hold a contract trade for several months, or even more than a week. As for fundamentals, their impact on the market is mid-term, so what is the point of using a mid-term factor to guide a short-term operation? The positive CPI data you see may just be the highest point after a decline that started a week ago, because once the positive CPI news comes out, the market spikes and then retreats, just hitting a short-term high. Then you see the good news, you go long, and as a result, you enter a long position at the highest point. For example, when interest rate cut news comes out, does the market immediately spike and go into a one-sided bullish mode? If you think so, you might want to review the past. Any positive or negative news in the market, if you open a position according to this news logic, the final outcome is likely to be shorting at the floor and going long at the stage's highest point. Therefore, if you are trading contracts, the news often becomes an unfavorable factor against your trade, a kind of noise. More often than not, the news is a tool for the big players to harvest retail investors. Moreover, many times the market rises or falls for no reason, and then the news comes out; it has already risen or fallen, and then you discuss the value and significance of this news—what help does it bring to your contract trading? Then they say that once the bad news is released, it means good news? This kind of fallacy.
Contracts are more like a precise digital price game, requiring accurate stop-loss levels combined with strict risk control to operate. I personally believe that only by combining pure technical analysis and frequent quantitative trades, along with a certain number of stop-losses and profits, can one achieve an overall profitable model, which is fundamentally the path to stable profits. With the same capital and the same trading period, one person may execute 100 trades with a profit of 200%, while another person only executes 1 trade with a profit of 200%. It seems the second person is more skilled; however, this is not the case. It is evident that the second person is overly weighted in their position, achieving 200% profit from just one trade, while the first person has better position management and risk control. As for their win rates, the first person's is certainly not as good as the second person's, who has a 100% win rate, but he only executed one trade, so his win rate cannot withstand the test of time. The first person's trading system is more mature. In the market, various contract liquidations may represent the second person's model—being overly confident in a single trade, exhausting their capital at once, and when the market does not move as expected, they end up getting liquidated and leaving the market. Ultimately, it is a matter of a gambler's mindset, a psychological issue, and a misunderstanding of the market. The market is not 100% certain; in life, many things that seem stable and have a high chance of winning can still have unexpected outcomes, let alone in the financial capital market. Putting all your trades on a single or a few operations cannot withstand the test of time, regardless of how much profit you made at that time. As long as you continue to play, you will always hold on to that gambler's mentality, and this mindset will eventually lead to a loss.
As mentioned above, technology might be the only useful thing for contract trading, but many people misunderstand technical analysis, thinking that technical analysis is prediction, while others believe that technical analysis is like taking past price trends and trying to find patterns. Some believe technical analysis is useless; the more you learn, the more you lose. This is how people in the market are—same things, same market conditions, different people always have different views, which leads to various complex and changing patterns in the market.
Technology is not prediction. First, you need to understand this market; market ups and downs are random. Yes, even if there are big players controlling the market, it is still random because various factors come together. Even big players might change their previous ideas. You need to understand that big players are also human and have to act accordingly. So, the market is random. Do you think it is reliable to use technical analysis to predict a random event? Anyone who has studied math knows there is a way to find patterns, for example, the series of numbers 2, 4, 8, 16, ... each number is twice the previous one; that is a pattern. But today's market is like this series of numbers: 2, 4, 3, 6, 1, 1, ... do you see any pattern? It seems that 2 and 4 follow a doubling pattern, but 4 and 3 do not, 3 and 6 do, 6 and 1 do not, and 1 and 1 do not either. The point is, it is random; sometimes there is a pattern, sometimes there isn't, so the market is like this. Sometimes when you try to find a pattern, you are right, and sometimes you are not. Once you realize the market is random, you should have risk control awareness and not be overly confident in any single trade, nor rely on a single trade.
Some people may be confused; why does technical analysis of past trends fit the technical points so well? If you open past charts, you can see this is the first buy according to the theory, this is the second buy, this is the third buy, and then you look at the MACD, and you see the golden cross, and the price rises all the way. Why does the analysis of the past fit technical analysis so well? Because you are looking at it from a god's perspective, fitting past trends into technical analysis theories. In reality, the current trend may be that after the first buy, there is another buy, and then another buy, and only then does it rise. Unfortunately, you miss the last buy and have already been liquidated. So how to catch this first buy? This is what I said before about position management. Don't treat a single trade as your chance to make a huge profit, leading to being overly weighted in positions, and always have stop-loss orders in place.
Once you recognize the randomness of the market, the assistive nature of technical analysis, and the importance of position management, you also need to focus on your mindset. Especially with stop-loss orders, after multiple stop-losses, many people cannot control their emotions and are eager to recover losses. I have had similar lessons in the past; such impatience can distort your operations, making you lose your rationality, often leading to liquidation or the beginning of significant losses. Therefore, cultivating a proper mindset is a critical step; most people remain stuck here and perish here.
The road ahead is long and has no ending; yet high and low I will search with my will unyielding. Let's encourage each other.