The most frequently asked question: 'How to judge support and resistance? When is the best time to enter the market?' To be honest, it's not that complicated—I have survived in the market for several years relying on a 'simple method'. Today, I will share with you the six-step mindset that I have been keeping under wraps, all hard-earned knowledge from my experiences, and after reading this, you can at least save three months' worth of tuition fees.
Step one: 'Catch live fish' from the gainers list. The first thing I do every day when the market opens is to check the recent gainers list and throw the stocks that have shown significant fluctuations and can produce decent upward trends in the last half month into my watchlist. Don't think this step is easy; many people like to pick 'safe stocks', saying things like 'low price is safe'—bro, 'dead fish' in the market won't flip over by themselves! Stocks with a record of price increases come with a 'popularity buff', just like a bubble tea shop in a mall with a queue; the chances of them getting hot again later are higher. This step directly helps you filter out 80% of ineffective stocks; wouldn't it be nice to save that time and enjoy a cup of coffee?
Step 2: Stick to the monthly MACD golden cross. I never have flashy indicator screens on my desk; I focus on just one: the MACD golden cross at the monthly level. Why? Because the golden cross is the signal that “confirms” the trend! Those who always think about bottom-fishing for a rebound are essentially gambling—I've seen too many people treat a “5% rebound” as a “reversal trend,” rushing in with their capital only to end up losing their shirts. If you want to make a profit, remember: if the trend is not established, watch more and act less; when the trend comes, it’s not too late to get on board, following the big direction is better than anything else.
Step 3: Wait for the daily chart to test the 60-day line with a “volume signal.” I only recognize the 60-day line in the daily chart; all other miscellaneous lines are turned off—out of sight, out of mind. I wait for the asset price to pull back near the 60-day line, and the trading volume must “suddenly increase”—this is the signal that funds are picking up below, equivalent to the market saying, “You can get on board now.” Never learn from those “bargain hunters” who rush below the 60-day line, thinking “the more it falls, the more I buy shows I know my stuff.” What happens? Either they get stuck halfway up the mountain as “cave dwellers,” or they get directly liquidated by leverage, with risks maximized—totally unnecessary.
Step 4: Don’t be a “hopeless romantic” with your positions. After entering the market, there’s one principle: hold on as long as the signal is intact; once it breaks the key support line, run away immediately without hesitation. I’ve seen too many people turn profits into losses, just because of that phrase, “Let’s wait a bit; maybe it can bounce back”—the market won’t care about your feelings; it can turn on you faster than flipping a page. If you hesitate for a second when it’s time to exit, your profits could drop by half or even turn into losses. Execution is the “invisible wing” to making money; don’t let “wishful thinking” lead you into a ditch.
Step 5: Take profits in batches; don’t be greedy for the “whole fish.” When profits reach 30%, take out half, and at 50%, clear out the remaining position. Don’t fantasize about eating the entire segment of the market; the market is like a “stingy person,” it will never leave all the profits to one person. I used to be greedy too, staring at the screen watching the candlesticks, silently counting, “I’ll sell when it goes up 10%,” only to watch profits shrink from 50% to 10%—no amount of slapping my thigh would help. I later understood: small profits accumulate to form bigger ones, which is a million times more reliable than one “big gamble.” A steady stream is what allows you to survive in the market for the long haul.
Step 6: Must stop loss if breaking the 60-day line; this is a hard rule! No matter if you just bought it for a day or have been stuck for three days, once the asset price falls below the 60-day line, don’t listen to what “experts say about future prospects,” don’t heed what “everyone in the community is bottom-fishing,” immediately exit without any soft-heartedness. This rule has saved me more than ten times; there was once when the asset broke the 60-day line, I gritted my teeth and cut it, and later it dropped directly by 40%—thinking about it now makes me shudder. Many think this method is “too mechanical,” but think about it: the more emotional people are in the market, the faster they stumble! Mechanical discipline is what keeps your hand that always wants to “gamble” in check.
In fact, this method isn’t miraculous, even a bit “foolish,” but it works due to “uncompromising execution.” If you’re always looking for “shortcuts” and chasing various “insider news,” you will eventually pay tuition. I share practical insights here every day, not to have you follow and buy, but to help you avoid the pits I’ve fallen into. Follow me, there will be more “anti-human nature” operational techniques to come, after all, in the market, staying alive is more important than anything else—don’t let it be that next time you can’t find me and end up operating blindly!
