Let me talk about a few phenomena first:
Are you extremely nervous when placing an order, wanting to win and afraid of losing? Do not set a stop loss to carry the quilt of the order, resulting in huge losses. Reluctant trading; casual trading, frequent trading, the result is beaten back and forth by the market.
Another example is to bet on the data to lose more and earn less; suddenly want to take a long-term, but the market pulls back, and the profit has been greatly withdrawn; sometimes I want to do a short-term, but find that the market has a unilateral trend. Wait too many questions like this. Regarding these problems, I believe that the vast majority of traders should empathize with them.
In fact, if you carefully observe and summarize, you can classify the above-mentioned similar problems. From my own understanding, there are still three aspects that cannot be escaped: trading system, trading habits and trading mentality. You can think carefully about whether it is some confusion at the transaction level caused by these three aspects in the end.
So how to solve it?
The first one is cognition. Cognition actually refers to transaction cognition, which is a certain understanding of transactions. At the cognitive level, it is necessary to distinguish clearly which is common sense, which is your belief and belief, and which is real cognition. For example, for example, we always emphasize the trading system, if someone asks what is the system? Or what factors should be included in the trading system?
When such a question is asked, I would classify it as trading common sense, because it is common sense stuff and you need to understand it. That is to say, when talking about the trading system, what do I think you are about the system? There is a concept. If you ask questions within this framework, then the corresponding thing is that you need to learn more about trading common sense.
Some people may ask is the system important? This is on the level of belief or belief. You can think that the system is very important and sticking to the trading system is the most important top priority. And he feels that the system is not important, and he trades casually at ordinary times. This method is beneficial to him or suitable for him. He believes that the market conditions are ever-changing, how can you use a system to make a good deal.
This is the difference in belief or belief. So how can this belief be formed? That is to say, we have to further ask why the system is important and why the system is not important. This belongs to the category of transaction cognition.
If you simply have a belief and feel that the system is important, but you don't know why it is important. Then when implementing the trading system, once you encounter problems, your ability to resist, your ability to resist pressure, the degree of your inner swing and vulnerability will be completely different. This creates a gap with traders who not only know that the system is important, but why the system is important. This is the role of trading cognition.
The second is the action of trading. If you think too much at the transaction level, but don't execute it in the end, it's all nonsense. Many traders actually have very good independent thinking ability, but many of them stay at the level of thinking. For example, if I lose money in trading, I meditate, and I sum up the reasons. It is caused by factors such as heavy positions, frequent transactions, and no stop loss. But if you trade again, you will still make a mistake. I know it's bad, but I can't change it. To use a common saying: I understand the truth, but I can't do it.
Concentrate these illusory thoughts on a specific action, so that your thoughts will be stable, and you will not be thinking wildly anytime, anywhere. Because there are a lot of traders who think too much, but just don't do it. At the level of execution, perfectionism must be put an end to. Don't think about getting it right in one step, but start from scratch.
We know that when a product is first launched on the market, it must be imperfect and needs to be continuously polished and refined, and then gradually perfected to gradually solve various needs of users and become a good product.
The same is true for trading. Don't think that I can become very good as soon as I do it, and then reach perfection all at once. This is impossible. So it's important to do it first when it comes time to execute. For example, at the level of trading cognition, you can truly understand that stop loss is waiting for a liquidation, then you have to execute the stop loss action; How to match your position, how to match a better stop loss in your trading system.
In this way, you will concretely implement the cognitive level on the action, which will promote the completion of this matter more quickly.
The third aspect is feedback. Feedback is actually divided into two aspects, positive and negative.
Let’s start with the positive feedback. For example, I have established rules, and I feel that after having the rules, I will reduce cranky thinking and random trading, which will allow me to reduce losses and face transactions with a better attitude.
Such positive feedback is helpful for me to continue to implement the solution process. It will have positive help in what I do.
Negative Negative Feedback. For example, you think stop loss is very important, but after you put the stop loss up, you get knocked out. And the market came back after knocking out your stop loss, so if you don’t make a stop loss, you can make money instead, right? What should I do if I encounter such a negative situation?
You need to analyze calmly. First of all, on the cognitive level, you need to clearly know that when you set a stop loss, you may encounter the possibility that the market will move forward after the stop loss is knocked out. This is bound to exist, and you cannot eliminate it, so you must accept this situation at the mental level. After some analysis, in fact, the adjustment of mentality has already begun.
Then consider from an objective point of view, is there a problem with your stop loss setting, can you improve your ability to set stop loss, can you improve your trading methods, and reduce the situation of the market breaking the stop loss and turning back? . Treat it objectively and calmly, and both sides must do it.
The fourth is the summary. sum up what? For example, to summarize the process of solving the problem just now, and which step I have reached, I will record it. Another example is the summary of the transaction, I record it. In this way, you can restrain your behavior when you make a transaction next time. After summarizing, there is more important thing, that is reflection. Why?
Because only by reflecting on the good and the bad, can these four aspects be promoted to form a closed loop. Only through reflection can new cognition be acquired. This has entered the cognitive layer again, and then started to take actions, started to give feedback, and started to summarize, continuously forming a closed loop to solve problems.
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