Last year a fan came to me with 1500U, wanting to turn things around and break even. I didn't explain complex indicators to him; I just shared three rules I learned through my own experiences. He followed them for three months, and his account grew to 50,000U without a single liquidation.
These three 'life-saving rules' depend on how much respect you have for the market.
First, divide the money into three parts: survive first, then think about making money.
I had him split the 1500U into three 500U portions, and I insisted he not touch it—this is what I understood after losing everything in one go and being unable to sleep at night:
· The first portion should only be traded short-term, with a maximum of two trades per day; once done, close the software—looking for even one more second can lead to greed;
· The second portion waits for trends; if the weekly chart hasn't formed a bullish pattern and hasn't broken through key levels with volume, absolutely do not move; making random moves in a choppy market is like giving away money;
· The third portion is emergency funds; when the market suddenly spikes and you risk liquidation, use it to add margin, at least keep you in the game.
Liquidation is like losing fingers; losing all your capital is like losing your head—without capital, all opportunities are irrelevant to you.
Second, only take a bite of the trend; at other times, act like a turtle.
I suffered too much from being cut in a choppy market in my early years; nine out of ten trades resulted in losses.
Later, I only recognized three signals:
· If the daily moving averages haven't formed a bullish alignment, definitely stay out, don't fear 'missing out';
· Only when the market breaks previous highs with volume and the daily close can you test with a small position;
· Once profits reach 30% of the principal, withdraw half of the profits, and set a 10% trailing stop for the rest—what you have in hand is yours; don’t aim to capture the entire market move.
Third, lock in your emotions, and execute like a machine.
You must write a plan before the market opens, then stick to it:
· Set a stop loss at 3%; if it hits, cut it—never say 'just a little longer';
· Once profits exceed 10%, move the stop loss to the break-even point; everything after that is just a gift from the market;
· Shut down your computer at midnight sharp every day; no matter how tempting the candlestick charts are, don’t look at them; if you can't sleep, just delete the app—staring too long leads to emotional chaos, and chaos leads to mistakes.
You may have been fumbling in the dark in the market before, but the light is here now.
I am Sister Lin, always here.