CN赵先生

Many new traders rush to study various indicators, but the truth is that learning 100 indicators is not as beneficial as mastering these three key selling points. Many people say that the conversion points in Chuan Theory are too complex, leading to the voices claiming that Chuan Theory is useless. However, the truth is that Chuan Theory is not useless; rather, it is that you have used the wrong entry point. Chuan Theory is like a trading system that emphasizes both rhythm and structure; using it is akin to playing Go, where the focus is on the initiative, response, and strategies between rounds. The game is like life, where wins and losses lie in the smallest details. True experts often foresee the changes ten steps ahead before making a move. In trading, what we truly need to learn is how to make your first move at the crucial moment, making a move without regret, seizing the opportunity. Today, we will thoroughly explain their underlying logic: buying once, twice, and thrice—how to identify, how to use, and how to secure your winning advantage. Our study of Chuan Theory ultimately aims to understand two questions: when to buy and when to sell. The first, second, and third buying points are the core focal points of the entire Chuan Theory system. Learning Chuan Theory is not about outlining structures but about grasping the buying and selling points accurately to have a winning edge. Therefore, the focus is not on how much you learn but on whether you can apply the first, second, and third selling points at your operational level, ensuring precise point control. Next, let's clarify the most fundamental definitions. The first type of buying point is triggered by divergence, indicating a depletion of momentum and signaling a potential reversal. The second type of buying point occurs when a pullback does not break previous highs or lows, representing a re-entry opportunity for trend confirmation. The third type of buying point occurs when prices break out of the center and then retrace but do not re-enter the center, indicating that momentum has built up, leading to a third buy. Of course, there are some special situations regarding buying and selling points in Chuan Theory. For instance, can a second buying point break the previous highs or lows? The answer is yes, but with conditions; the key is that it cannot break the center. For example, if the second buying point breaks the first buying point, it is entirely possible, typically forming a consolidation divergence. The condition for the second buy is that after the first buy, the price retraces but does not break the low of the first buy. When a bottom divergence appears, it constitutes a second buy. Additionally, there is a variant of the second buy where the position can be slightly higher or lower than the standard second buy, but similarly, the prerequisite is that it cannot break the center structure. In Chuan Theory, the first, second, and third buys represent three different phases of buying opportunities. Mastering them is equivalent to seizing three chances in the market. The first buy serves as a stabilizing starting point, lurking against the trend. The first buy typically appears after a significant decline during the first rebound, representing a contrarian position. At this time, the price breaks below the previous low and quickly rebounds, showing a divergence signal. Simultaneously, MACD bottom divergence and volume-price divergence appear, forming an upward attack. The key is the bottom divergence coupled with the first rebound and additional small-scale confirmation. The practical focus is that stop-loss should be close, and the position should be light, as it is a tentative bottom-fishing opportunity. The core logic is that there is a possibility of a significant downtrend ending, followed by MACD's red bar divergence and volume-price divergence. Then, a key K-line appears, such as a dragonfly line or strong engulfing, along with a very strong lower shadow. Afterward, the first pullback does not break the previous low, and the bottom divergence is established, which equals a first buy opportunity. The identification points include an obvious divergence in the previous decline, the shortening of MACD red bars, and prices making new lows but with insufficient momentum. After the divergence, an upward move forms the first rebound. The rebound retraction does not create new lows, indicating a bottom divergence. The entry technique is to buy when the bottom divergence is confirmed on the left side and set the stop-loss at the previous low or below the lowest point of the bottom divergence. Caution: the establishment of divergence does not mean immediate entry; the first buy is confirmed after the first pullback, and blind bottom-fishing can easily lead to losses. The second buy is for confirming the pullback and low absorption. The second buy is a pullback during the continuation of the trend and is one of the most important buying points in Chuan Theory. It appears after the market breaks the center for the first time and forms a new secondary center or stabilizes near the upper edge of the previous center. The key is not to break the previous center during the pullback for confirmation. The practical focus is that the position can be heavier compared to the first buy, as it marks the starting point of the main upward wave. The stop-loss is set at the lower edge of the center or the low point of the confirmation line. After the price stabilizes within the center, it breaks upward from the first pullback at the upper edge of the center, forming a second buy. The core logic is that the center structure is completed, and upward breakthroughs during pullbacks confirm support. A bottom divergence indicates a second buy opportunity. The identification points are: the emergence of an obvious center, with at least three lines properly leaving the center and then pulling back without breaking the lower edge of the center. During the pullback, the trading volume decreases, and a stop-loss K-line and divergence form. The entry technique is to buy after confirming the stop-loss divergence on the pullback, with the stop-loss set near the lower edge of the center or below the K-line's entity low point. The advantage is a high success rate with low risk, suitable for most people's practical operations. The third buy serves as an acceleration point in a strong trend. It occurs during a trend that has already been established and after consecutive breakthroughs of high points, typically accompanied by reduced volume and MACD's golden cross or other indicators assisting in judgment. The focus is on the new high not breaking during the pullback, with a small retracement followed by another rise. The practical focus is that it is suitable for strong chasing. The scenario is that a major trend has started, with a new attack point after a small-scale pullback. The core logic is that the main trend is clearly upward, and then a small-scale pullback forms a new center or stabilization without breaking previous lows, resulting in a bottom divergence, which equals a third buy opportunity. The identification points are that it is currently in a clearly rising structure with three segments or more, where the pullback forms a secondary center or small adjustment, and MACD's red bars shorten and then expand or show consolidation divergence. A small bottom divergence appears on the right side. The entry technique is to chase in when the small bottom divergence breaks out, entering in the direction of the trend, with the stop-loss set at the lower edge of the small center or below the previous low. The appropriate scenario is during a strong trending upward wave; the third buy point is an excellent opportunity for continuous position building. Looking at selling points, the structure of selling points is basically symmetrical. The first, second, and third selling points correspond to the top divergence, trend failure during the pullback, and accelerated topping, respectively; the principles are the same. The reverse application of the first, second, and third types of selling points: the meaning of the first sell is the first rebound failure after the top divergence, with the application scenario being a prelude to a decline, focusing on profit-taking. The meaning of the second sell is breaking down through the center, confirming failure on the retracement, with the application scenario being a structural short signal. The meaning of the third sell is a small rebound followed by another decline, representing an opportunity to short in the downward trend. In addition to mastering the basic concepts of the first, second, and third types of buying and selling points, we often encounter various mixed special situations in the real market. Therefore, I have also organized some subdivisions of the first, second, and third types of buying and selling points, along with a practical mnemonic for converting buying and selling points to help everyone apply them flexibly in practice. The mnemonic for converting buying and selling points is as follows: 1. Find a sell above the center; 1. sell can convert to 3 sells; 2. Find a buy above the center; 3 buys can convert to 1 and 2 buys; 3. Find a buy below the center; 1 buy can convert to 3 sells; 4. Find a sell below the center; 3 sells can convert to 1 and 2 buys. After mastering the theory of buying and selling points, the next step is practical application. During my learning and practical experience with Chuan Theory, I encountered several difficulties. Next, I will summarize some common practical issues, as well as the solutions I have personally found, and share them with everyone in the hope that they can provide some references and insights for your practice of Chuan Theory. The practical difficulties are: the original text of Chuan Theory emphasizes that without divergence, there are no buying and selling points. This expression actually signifies the end of standard trend types, where divergence is typically required. However, the formation of buying and selling points can occur through various structural methods; thus, not all segments and the first, second, and third buying and selling points will exhibit divergence. Therefore, when we encounter such situations, we need to handle them in three ways: 1. Trend-ending buying and selling points usually require divergence. You can boldly build positions based on divergence. 2. Consolidation divergence buying and selling points do not necessarily have divergence; operate based on the center and overlapping structures. 3. Strong trends in the direction of buying and selling points usually have no divergence; enter in the direction of the trend and set appropriate stop-loss. The specific handling methods are: 1. Determine whether it is a continuation segment within a strong trend; continuation segments without divergence signal the end, but the next segment continues the original trend. 2. Use center oscillation to find buying and selling points. In the absence of divergence, if the segment forms a new center consolidation structure, you can use the center oscillation theory: sell at the upper edge of the center, buy at the lower edge, sell at the upper edge during a decline, and buy at the lower edge during an increase. This method is not a divergence type buying and selling point but a center structure buying point. 3. Conduct multi-level confirmation, which is very crucial because Chuan Theory emphasizes level confirmation. If one level has no divergence, you can observe whether the next lower level has divergence. Summarized: First, segments ending with divergence are standard buying and selling points; act decisively. Second, segments ending without divergence should be approached with caution, waiting for the next segment to confirm before entering in the direction of the trend. Third, segments ending without divergence but entering a consolidation center should be approached cautiously. 4. High levels without divergence, and low levels with divergence, should be approached with incremental testing signals. If truly uncertain, wait and observe. Because there is a saying: the apprentice buys, the master sells, and the master remains in cash. When there are no relatively certain high-quality opportunities, waiting is also a form of profit. Chuan Theory is a rigorous and complete market analysis system that precisely depicts the rhythm of the market through structures such as divergence, lines, segments, and centers. It constructs clear trading logic with the first, second, and third types of buying and selling points. The first type of buying point captures trend reversals, usually accompanied by divergence, presenting both risks and opportunities. The second type of buying point confirms the continuation of a new trend and is an important entry point for stability. The third type of buying point indicates the end of consolidation and the establishment of a trend, representing ideal entry points for directional trading. MACD, as an auxiliary tool, provides quantitative evidence for buying and selling points. Chuan Theory is not only a technical system but also a trading philosophy that emphasizes level awareness and the application of range-bound strategies, advocating a global approach with attention to detail. More importantly, it reminds traders to cultivate their mindset, adhere to discipline, and patiently wait for standard buying and selling points, which is the fundamental basis for long-term profitability. As Chuan said, "Logic leads to enlightenment; matters require gradual improvement." Mastery of Chuan Theory relies on practical accumulation and the sharpening of one's mindset. Market opportunities are infinite; missing them does not entail regret; the key is to wait for the right moment to act. The first type of buying point captures reversals, the second type of buying point stabilizes confirmation, and the third type of buying point acts in the direction of the trend. True opportunities never rely on guessing but rather on waiting for a structurally complete and rhythmically aligned buying point. As Chuan Master said, "If you miss it, you miss it; there will be countless opportunities ahead. Do not rush; the market is always there. The important thing is whether you can understand it, keep up with it, and grasp the rhythm of the market.

Have you often heard the saying that in trading, technique is secondary, and the hardest part is mindset? Many experienced traders emphasize that greed and fear are the real reasons behind your losses. It sounds reasonable, right? But today, I want to present a counter-consensus viewpoint: the trading mindset itself might be a severely overrated and even fundamentally flawed concept. The reason you often feel like your mindset is poor is not that you truly have a bad mindset, but because your understanding of the underlying principles of trading is not in place. The essence of the mindset issue is a cognitive problem. What we usually refer to as a mindset collapse is simply a few manifestations: holding on when in profit, stubbornly enduring when facing losses, becoming anxious after consecutive losses, leading to more mistakes, feeling flustered right when entering the market, always thinking your account will explode in the next second, feeling elated after making a little money and collapsing after losing a bit. Many people repeatedly tell themselves to stay calm and rational, even resorting to meditation, exercise, and psychological suggestions, but what happens? They still panic in the next trade. Why? Because you are only managing emotions without addressing the root of those emotions, which is your unclear and even incorrect understanding of risk-reward, trading systems, and the essence of the market. True experts never manage their mindset; they have simply integrated these underlying logics into their very being. Whether you are using spare money or life savings is crucial. Many people say they can accept risk, but once they start losing, they can't sleep. Why? Because they have not truly allocated their assets correctly. The money you can bring into the market must be funds you won't need for the next 3-5 years—funds you are willing to lose completely without affecting your basic living expenses. If you can't achieve these three points, it doesn't matter whether your account has 10,000 or 1,000,000; you are gambling, not trading. The so-called stable profits don't exist; only long-term survival exists. Many people pursue a holy grail trading system, hoping that learning a specific technique will allow them to make money every day. But the truth is, even Buffett has lost, Soros has blown up accounts, and Livermore ultimately committed suicide. No one can truly achieve stable profits. Trading is not a money-making plan; it is a risk-gambling plan. What you really need to do is not avoid risks but to earn as much as possible when you are making money and lose as little as possible when you are losing. In the long run, profits can cover losses. Once you understand this, you will no longer doubt yourself due to consecutive losses. Losses are normal, and profits are normal; gains and losses come from the same source. You only need to care about whether your trading system can have a long-term positive expectation. You are not a soldier; you are a sniper. Many people turn trading into a suicide squad mode, frequently entering and exiting, emotionally charged. A truly mature trader is more like a sniper: they only place trades they understand, setting stop-loss and profit-taking limits in advance for every trade. They do not act on opportunities that do not fit their system, even if everyone around them is shouting that an opportunity has arrived. You should not fight against emotions but go with the flow. If you feel flustered and unsure and are afraid to place an order, don’t force it—that indicates your system is still not mature, and your understanding is not yet in place. Keep waiting and learning. So how should you manage your mindset? The answer may surprise you: you don’t need to manage it at all. Just like when you fell and cried as a child, you don’t cry now when you fall; it’s not because you manage your mindset better but because you have grown up, and your understanding has changed. Trading is the same. When you truly trade with spare money, accepting losses becomes inevitable. With a trading system that has a positive expectation, taking only trades you can understand, you will find that those mindset issues you once thought were problems will naturally disappear. You will no longer dwell on single trades’ gains and losses, will not rush to break even, and will not be unable to hold onto profits because you clearly know that every trade you make is a rational decision based on long-term logic. The results are merely a natural presentation of the process. To sum it up, the so-called mindset problems are actually external symptoms of cognitive problems. Elevate your understanding, grasp risk system trading, and your emotions will naturally align. All mindset issues are just pretentious; it's like you were nervous and hesitant to get on the highway before you got your driver's license.

The final hurdle in trading is human nature. The true prerequisite for enlightenment is to let go of the ego. In other words, you must first completely acknowledge that you are not capable, accept that you are just an ordinary person, and throw away your inflated ideas. Start learning honestly from the basics. Many people learn a lot of techniques and even have a decent trading system, but they cannot stabilize their performance. The reason is that they are trapped in the cage of technique and have never been able to overcome the inner conflict. In the next three minutes, I will explain the phrase 'kill the human heart, let the heart of the way live' in simple terms, and then tell you how to take that most difficult yet crucial step from today onwards. First, let's discuss the first half of the phrase 'kill the human heart.' You must understand the first rule: in trading, true growth begins with your complete acknowledgment of your limitations. What does it mean to kill the human heart? Simply put, it means to kill that part of you that constantly overthinks and acts smart. Is there always a voice in your head saying, 'I feel this wave is going to rise'? That's the little smartness trying to predict the market. After just losing 500, thinking, 'I need to make a trade quickly to recover my losses' reflects the gambler's mentality. If you profit from a trade, thinking 'I'm a genius' shows that you don't know your own limits and are getting inflated just for making some money. This human heart is your little self; as long as it is alive, it will disrupt your critical decisions, making you ignore the rules and trade based on feelings. The market is a slaughterhouse for this human heart. Only by completely letting go of it and sincerely acknowledging that you are just an ordinary person who knows nothing in front of the market, and only believing in the rules, can you truly enter the field. So starting today, please begin a small exercise: clearly write down the plan for your next trade, and regardless of whether you make or lose money, review whether you honestly followed the plan, and at which moment you were led astray by your human heart. Acknowledge its presence; this is the start of killing the human heart. Of course, to achieve this, you must have a set of rules that you can wholeheartedly follow—your trading system. Many people misunderstand the term 'system,' thinking it is just a few indicators. Only after the human heart is dead can the heart of the way live. Remember the second rule: the so-called heart of the way is your unwavering belief in your validated trading system. This heart of the way is your higher self; it is calm and objective, believing only in probability and rules. Let me give you an analogy: your human heart is like a novice driver who just got their license and wants to speed, while your heart of the way is like the emotionless voice of a navigation assistant. The novice driver, led by their emotions, often wants to take shortcuts and drive fast, resulting in violations and even disasters. In contrast, the voice of the navigation assistant remains calm, regardless of how congested the roads are or how anxious you are. It will repeatedly remind you to please follow the planned route. When your trading can completely ignore the various distractions in your mind and only follow the signals from the navigation, opening a position when the signal appears and exiting at the stop-loss, that's when your personal chaotic thoughts can be entirely suppressed, and your stable and reliable higher self can truly take control of your account. So for your next trade, please try a role-playing exercise. Tell yourself, 'I am not the driver; I am just a robot responsible for signaling turns.' Your only task is not to think about where to go but to execute the navigation instructions 100%. When you shift your focus from where you can end up to what you need to do now, your heart of the way begins to awaken. Therefore, you see, from an emotional novice driver to a robot with an unperturbed inner self, the path of killing the human heart and letting the heart of the way live is the ultimate cultivation in trading.

Speculators ultimately walk the path of cultivation. Why is it that in the seemingly cold candlestick charts, some see the Dao? Qingze says that the purpose of entering the market is to seek wealth, but in the end, it is about understanding the Dao. You may think this is a book about techniques, but in fact, it is a solitary soul's journey, grappling with the world. One of the trading philosophies: I think, therefore I am. What the world looks like depends on the kind of eyes you use to see it. Those lightly influenced by Kant's philosophy realize that we cannot truly understand the market itself, because the market has no so-called essence. The price trends we see are merely phenomena filtered through our subjective consciousness, just as Kant said that people cannot know things in themselves. We also cannot truly know the market itself. Therefore, Qingze concludes that we must artificially legislate for the market, constructing our own theoretical framework to guide trading decisions, rather than blindly seeking the truth. This inevitably brings to mind Wang Yangming, who, when realizing the Dao in Longchang, also said that there is nothing outside the heart, and the heart is principle. There are no rules outside the market; the principles exist within your heart. How you think about the market is how the market will respond to you. Therefore, the true path of investment is not to seek absolute truth, but to establish a truth that suits oneself. Trading philosophy two: More means confusion, less means gain. A complex eye sees a complex market, while a simple eye sees a simple market. Many traders fall into information anxiety, trying to integrate news, technical analysis, fundamentals, financial reports, and macro analysis. However, Qingze believes that the more one tries to cover all bases, the more chaotic it becomes. He does not encourage the creation of so-called all-weather trading systems, but instead advocates for deeply understanding a particular set of theories, embracing its flaws, trusting its strengths, and using familiar tools: do when you understand, and don’t when you don’t. More means confusion, less means gain. This is akin to Zhang Liang, who, knowing countless military strategies, only followed the three volumes of Huang Shigong's teachings and became a genius who could strategize from afar. In real trading, if you treat all theories as seasoning, a hodgepodge may seem rich but is actually tasteless. Stable trading is about giving up the perfect outcome; it is the wisdom of subtraction. Trading philosophy three: The Dao exists in the mundane. Speculation is the path of cultivation. The you outside of trading determines the you within trading. Lightly referencing the cultivation path in university, it emphasizes that trading is not a skill, but a cultivation of character. Speculators should not just be readers of candlesticks but also practitioners of inner cultivation. He said that if you are restless, greedy, and undisciplined in life, then during trading, you will inevitably chase gains and panic sell, driven by greed and fear. Spiritual cultivation is not about grandiloquent discussions, but about profiting in everyday trivialities. This reminds me of Zeng Guofan, who rose in the cracks not through military strategy, but through four daily practices: sitting quietly, reading, and rising early. His success was built bit by bit. Qingze proposes the six-character mantra: gather your heart, gather your heart, cultivate your heart. You are not cultivating trading, but yourself. Trading philosophy four: Belief is power; knowledge is not power. Belief is power. Speculators are more like ascetics, not accumulators of knowledge, but practitioners of faith. Qingze says that after constructing one's own trading theoretical system, one must believe in it steadfastly, just like a religious belief, following and practicing it. Because the market is ever-changing, without faith as an anchor, our actions will drift with the tide. In the market, there are many smart people, but those who truly succeed are those who are willing to believe and continuously practice their own systems. Qingze states that traders are not scholars, not wise ones, but practitioners. From 'I think, therefore I am' to 'Belief is power,' he has walked a solitary yet renowned path of cultivation. The ultimate goal of trading is philosophy, and the maturity of a trader is the stability of their character. Perhaps, as he himself said, seek wealth in the world, and understand the Dao in the end.