Coin Circle Academician: Interpreting the Key Points to Enhance the Understanding of Coin Circle Trading, Opening the Door to Enlightenment (Part Five)

CN
5 months ago

Are you sure you clicked into the right place? Today, as always, we continue to explain the content of improving the understanding of the currency circle trading from the previous issue. Please be patient and read carefully. After reading all the content of improving the understanding of the currency circle, you will become a different person and have a new understanding of the currency circle. This is also the enlightenment of the currency circle master in the 13-year journey of the currency circle, selflessly sharing with everyone, hoping to be helpful to everyone.

The 16th key point of improving the understanding of currency circle trading is to enhance the understanding of the trading system formed

The previous articles by the currency circle master have explained in detail what a trading system is, so I will not repeat the repetitive content here. This issue focuses on the deep understanding of the process of system formation, in order to avoid the trading system from falling into the trap of rigidity and mechanization.

Here, the currency circle master once again emphasizes that the trading system is a dynamic mechanism that continuously upgrades and improves in line with market dynamics. The two main pillars supporting the entire trading system are psychology, market analysis, risk management discipline, and trading records. It is important to note that discipline and trading records are the two key elements that integrate the previous three and are effective tools for monitoring system vulnerabilities.

The currency circle master first emphasizes the judgment of win rate and loss rate. The judgment of whether the win rate and loss rate meet the standard must be determined after the market has completed its course. However, whether our expectations for the trading system are positive or negative must be based on the statistical basis of our long-term trading results.

The currency circle master needs to emphasize that it must be based on the statistical results of our own actual and long-term trading, rather than using a computer program to backtest and verify historical trends of our system, and then derive positive or negative results to incorrectly guide our future trading operations. The result of doing so can only lead to more mistakes. This is because the results of historical backtesting often differ greatly from actual trading results, mainly due to completely different scenarios, environments, psychology, prices, and time spans.

Therefore, our own trading system must be put into actual trading for verification, and then we need to conduct our own statistics. Based on the statistical results of our actual trading, we need to use a probabilistic mindset to identify those high win rate and high loss rate trading operations, and see if there is a possibility of repetition and commonality among them.

At the same time, we also need to focus on summarizing those low win rate and significantly loss-making trading operations, and earnestly try to overcome these bad trading habits in subsequent trades. After years of statistical analysis by the currency circle master, if we remove these emotional trading operations, and our profits are positive, it means that we have obtained a trading system with positive expectations.

The next step is to maintain the repeatability and consistency of our advantageous operations, and strive to eliminate our random or unplanned trading habits. If everyone can fully comprehend and adhere to the key points emphasized by the currency circle master, then your trading system can be considered truly formed.

The essence of trading for the currency circle master is feasibility. Therefore, feasibility determines that this system belongs entirely to you. It is completely integrated with your mentality and character, and you can fully understand and control it. At the same time, it is a system that cannot be imitated by anyone, and it will become the most core competitiveness for you to establish yourself in this market for a long time. The process of forming the entire trading system is essentially a process of improving our own understanding and overcoming our bad habits.

The currency circle master once again emphasizes that this process absolutely cannot involve any opportunistic or lazy behavior, otherwise the system will treat your trading behavior with the same attitude, and the consequences will be unimaginable. Therefore, you must go through the verification of actual trading. As I have mentioned before, the trading system is a dynamic development process based on changes in the trading environment and psychology. When the scale of the funds reaches a relatively large level, adaptive adjustments need to be made, and the time for adjustment and verification is relatively long. Only after actual trading confirmation can its stability and effectiveness be ensured. So, if you follow the currency circle master, I will teach you for free, and we can learn and grow together as I teach you while doing it.

The 17th key point of improving the understanding of currency circle trading is to enhance our understanding of the importance of developing a habit of recording trading operations

When it comes to trading records, the currency circle master has found that many traders have almost no habit of recording, and even ignore the importance of trading records. It is precisely because of their indifferent or neglectful attitude that they repeatedly experience the same tragedies in this market without realizing it.

Before the currency circle master explains the formal content, I would like to share a passage from Andrew MacLean's book "Relax Your Life" with everyone here. He said, "There is no such thing as a free lunch in the world, and like many other things, you either pay in advance or pay after the fact, but unfortunately, when you are ready to leave, the price you pay is often higher." In actual trading, the market speaks in two aspects, and sometimes it is not always consistent, and such situations can occur from time to time.

Here, the currency circle master gives an example. Sometimes in trading, we may encounter a special situation where an unplanned trade unexpectedly makes money, while a carefully planned and executed trade plan results in a loss. It is these random events that often lead us to overturn our own trading principles and plans, leading to hasty trading.

Therefore, random events are generally a very small probability issue. But it is precisely these very small probability events that often lead to our frequent random trading. Therefore, developing a good trading record habit is the best tool to cultivate and adhere to discipline. A complete trading record, from the perspective of content structure, is our trading log.

If recording our trading plan can ensure that we do not miss any major factors affecting the market, then recording our trading log and developing the habit will help us avoid falling into the trap of impulsive trading, and help us reflect on our past mistakes at any time, avoiding us from repeating the same mistakes and going further astray in wrong trades.

A rigorous and professional trading log consists of three core parts: preparation of basic work, trading plan, and recording the entire process of plan execution. First, let's talk about the basic work. The preparation of basic work is a series of necessary preparatory procedures to be done before trading in the morning.

Using a rigorous set of steps and procedures to understand the key factors that will dominate the market and trading today. These necessary preparatory procedures can help us be methodical and prepared for any changes in the market before and after the start, and make corresponding plan operations at any time.

Here, the currency circle master takes short-term trading as an example to illustrate. Before the morning opening, the basic work we need to do includes being well-informed about the overnight information and its impact on the domestic and foreign markets. For example, the performance of the European and American stock markets overnight, the performance of the big cake the next day, the changes in the RMB to USD exchange rate, the futures market, the changes in gold, the Ethereum market, the performance of Bitcoin, US holding data, the latest news from the Federal Reserve, and the opening situation of the currency circle. We also need to be clear about the real-time policies and changes in the currency circle.

The second is the trading plan. Any trading plan must be tailored according to the trading strategy, and there must be a set of quality standards to measure the trading plan. It is necessary to clearly record the planned buying price, the planned selling price, the stop-loss price, and the trading scale.

A detailed trading plan can help us remain undisturbed by random price fluctuations and maintain inner calm and rationality.

The third is the full record of the plan operation process. The full record includes the actual buying and selling prices, the logic of buying and selling at that time, the actual floating profit and loss situation, the reasons for the floating profit and loss, the execution of the trading plan, and the results, and so on.

A full record can almost completely reproduce the situation and psychological activities of our operations at that time, allowing us to review each of our trades at any time and gain rich experience and lessons from them. It is not only a record of our growth on the trading journey, but also a documentary of our understanding of human nature and self, and a spur for us to continuously improve and correct ourselves.

Therefore, the currency circle master believes that in order to become an excellent trader in the currency circle, it is necessary to develop the habit of recording trades and persist in doing so. Once recording trades and reviewing trade records become a daily habit, we will naturally become more and more smooth on the trading journey.

Today's content ends here. "Review the old to know the new," I have once again gone through these materials in my mind every time I organize them. I hope the path of the currency circle master can help you avoid some detours.

I am a warrior who has always been protecting the leeks, and I wish my fans to achieve financial freedom in 2024. Let's work hard together!

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