We have been learning knowledge since kindergarten, starting with counting, learning addition, subtraction, multiplication and division. Once you learn it, it is yours, and it is all pure and unchanging knowledge. In junior high school, we learn the Pythagorean theorem, which is applicable to right triangles. As long as we don't make a mistake in the calculation, the side length calculated by the Pythagorean theorem is certain.
When we study physics in high school, we can calculate the speed of an object at a certain starting moment by knowing the acceleration and starting time, and then we can calculate it according to v=at. Therefore, the education and knowledge we have received since childhood are all fixed knowledge. The content we have learned will not change with time. We just need to apply it by analogy. As long as the logical reasoning is correct, the result must be correct.
Looking at various industries, although some people or companies are losing money, 80% or most of them are profitable, and a dynamic balance of supply and demand has been formed between industries. The per capita GDP can support everyone's life. For ordinary office workers, the probability of making money from doing something is 1 if there are no special circumstances. Even if it is doing business or other things, success can basically be controlled.
The trading field is completely different. Nothing is absolute. No transaction can guarantee success. Even if you have a 90% successful strategy, if you do not set a stop loss, there is still a risk of your position being liquidated. Therefore, trading is much more difficult than other industries because there is "uncertainty". This uncertainty is mainly reflected in the following aspects:
(1) The market is constantly fluctuating. The magnitude of the upward and downward fluctuations is random or chaotic. When we set a stop order, we are also calculating the probability.
(2) False breakouts often occur, the most common of which is the 2B pattern;
(3) The shadows of different periods are also different, which is essentially a kind of false break;
(4) Fundamental risk events, such as the UK’s Brexit referendum and the US presidential election in 2016.
All of the above are enough to bring great difficulty to our trading. The success rate of an excellent trading system can only reach 70-80%. The correct trading method will also be stopped out, and people's thinking or tendency is not to accept losses. Then at this time, the correct method will be missed. Similarly, the wrong method may also make you money, which will be more confusing. Let's take an example to illustrate the above uncertainty. In an upward trend, there is a downward callback. When it reaches the support position of the trend line, you think it is a good opportunity to go long, so you go long and stop loss below the trend line. This is a reasonable operation. However, the market is going down strongly, breaking directly and you are stopped out. The next time the same situation occurs, you will not be so anxious after the last experience. Wait for the market to break the trend line and then follow up with the short order. Unfortunately, this time it took the 2B pattern, and the K line instantly pulled back to the trend line, and you were stopped out again.
The same market situation appeared for the third time. You waited for the market to break but did not enter the order. When the market pulled back up again, you thought that 2B had a follow-up long order. Unfortunately, the market fell sharply after stepping back on the trend line, and was stopped out again. You have been stopped out to the point that you start to doubt your life. You think you did everything right every time, but the fact is that it is unfortunate. What is the problem? It is because the market has "uncertainty". It happens that you are always stopped out of the 30% every time. Of course, in specific cases, you also need to consider whether your method and system are verified. I will not discuss it in detail here.
The above example is still under a clear structure, but this structure has 3 different results. Sometimes the market will not give you a structure at all. You can't understand what it wants to do, and even it doesn't know what it wants to do. Therefore, trading can only be a probabilistic event. Most of the time, there is no right or wrong. Even a novice who knows nothing can make a lot of money just after entering the market. Choosing the trading industry is choosing a road paved with thorns. Of course, the more difficult the road is, the greater the reward will be after walking it.
It is a consensus that financial speculation is difficult to succeed, because it places extremely high demands on traders. More importantly, most of the demands violate human nature and bring pain to people. Trading is like a practice. Only when you understand the truth and have the right method can you reach the other side of success. Therefore, trading is not something you will succeed in if you work hard. It is really much more difficult than other industries, but I hope you will stick to it if you have faith!
Friends who like it are welcome to like, collect and follow. I wish you all a smooth investment!