Actually, achieving short-term profits in trading is not difficult; sometimes, by betting on the right direction, one can make a lot of money all at once. However, trading cannot be limited to just this one instance; it must be done hundreds, thousands, or even tens of thousands of times. Experienced traders who have been in the game for a long time know that making a profit once is not the hardest part; consistently making profits over the long term is the real challenge. Many people underestimate the difficulty of trading, which is why they get slapped in the face by the market.

I have been on the trading path for over a decade, much like Tang Seng's journey to retrieve the sacred scriptures, enduring eighty-one trials and tribulations, and facing all kinds of hardships.

I've found that whether it was doing business in Africa in my early years or trading later on, I faced many difficulties. In the face of adversity, we cannot simply complain and suffer; instead, we must find ways to solve these problems in order to achieve success.

Today, I will combine my past experiences to dissect some of the issues that need to be addressed in trading for everyone, including technical issues, mental issues, and capital issues, and discuss them in detail.

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1. The Core Thinking for Solving Problems

Before delving into specific issues, I would like to first discuss the core thinking for solving problems with everyone.

Firstly, when we encounter problems, we should not get trapped within the problem itself, viewing the part as the whole.

Many traders approach trading like climbing a mountain, thinking they have a complete view of the landscape once they reach the base. When you mistake the base for the summit, everything you see is wrong; how can you possibly make a profit?

Many traders believe that as long as they study technical indicators and trading techniques,Once the technical issues are resolved, making money naturally follows suit.

There is certainly nothing wrong with studying technology, but while we refine our technical skills, it is also necessary to elevate our cognition and perfect our trading psychology; only by combining these aspects can we achieve stable profits.

Otherwise, it will be like in my early days, where I could talk about technology with great insight, but making a profit seemed far off.

Additionally, do not fear difficulties; learn to break down, analyze, and solve problems.

Most of us tend to develop a "fear of difficulty" when faced with a significant task, thinking that it is too troublesome, too hard to resolve, and unsure where to start, so we might as well just give up?

Many people are the same when trading, constantly in a losing position, wanting to end this state, but feeling that it is too difficult, losing no matter what they do, and feeling at a loss about where to begin.

At such times, if we take our trading records and make a statistical analysis, breaking them down to see what common mistakes we make in our usual trading, and why we make such mistakes, listing the problems one by one and then finding answers for each.

Gradually, as the mistakes are corrected and resolved one by one, your trading thoughts will become clearer and clearer, like threading a needle, linking the entire trading process together, and the trading will become smooth.

After straightening out these two types of thinking, let's discuss the specific issues that need to be addressed in trading.

2. First, solve the technical issues.If you're a trader who comes for a quick play and then leaves, we can't talk about the technical aspect. However, for those who aim to achieve long-term and stable profits, trading techniques are crucial.

Technical skills address the specific operational issues in trading, such as how to determine the direction of the market, when to buy, when to set a stop loss, and when to close a position and secure profits, etc.

It's like filleting a fish in the market; the act itself is not difficult, but it has its own techniques and steps. As long as you master them proficiently, you can fillet the fish quickly and well, and the filleting technique will greatly influence the long-term revenue of the stall.

When I first started trading, I only read some books on candlestick charts, and I didn't pay much attention to trading techniques at that time. I bought and sold purely on intuition, and trading felt like a roller coaster ride, with every day being thrilling and exciting.

Sometimes, the more you fear something, the more it comes. The market seemed to have a grudge against me, always moving in the opposite direction. Back then, I didn't understand the techniques, and when I was wrong, I didn't know how to cut my losses, resulting in either a significant loss or a blown account.

It took me a long time to truly realize that chasing the market by buying high and selling low would only lead me into an abyss, which is no different from gambling. Only by mastering some techniques can one achieve real profits.

I have condensed my process of learning trading techniques into several steps to share with you:

1. The first thing I learned was candlestick charting techniques.

Charts are composed of candlestick lines, and many indicators are calculated from the prices of these lines, so candlestick charting is the most fundamental aspect and must be thoroughly understood and mastered.

2. Study technical analysis theories.For instance, theories such as Dow Theory and Elliott Wave Theory can be studied individually, but one must delve deeply into them to fully understand and master them.

3. Learn technical indicators.

Select two or three indicators and thoroughly study their principles, methods of use, advantages, and disadvantages.

4. Learn trading systems.

This includes the framework of trading systems, how to compose a trading system using indicators, and how to assess the quality and stability of a trading system, among other things.

5. Test and optimize your trading system.

I spent about two years optimizing my trading system, placing it in a backtesting software, and testing all parameters that I had doubts about, such as different entry and exit methods, risk-reward ratios, various indicators, different trading instruments, and the testing of success rates and stability, etc.

Here, you will test the system's decay, including the maximum number of consecutive losses, the duration of decay, the amount of drawdown, etc., to see if they meet your psychological expectations.

6. Paper trading practice.

After testing and optimizing the trading system, practice repeatedly on a paper trading platform, using an amount that you can afford in real trading, to feel the rhythm of the market and cultivate trust in the trading system.Many people feel that learning trading is disorganized. When you break things down one by one, you'll find that the content to learn is actually very focused, and the more you learn, the less there is to learn. In the end, your trading system might just be a few simple candlestick patterns that you once dared not even think about.

If you encounter complex situations during the learning process, such as a tedious review process that is very frustrating, you can further break down the workload and devise some review plans. For example, spend three days reviewing the 90-day moving average, then another three days reviewing the 120-day moving average, and record the results of the review. This way, the workload each day is not too heavy, and the results are very clear.

When faced with complex matters, don't rush. These can be solved through physical methods, so just break them down one by one.

3. Next, address the psychological issues in trading.

If the technical learning mentioned above is well in place, it can actually solve 80% of the psychological issues. Too many psychological problems arise because the technical skills are not adequate enough.

However, many people still have psychological issues even after they have a trading system.

For example, when an order is profitable, because they have experienced losses in the past, they become afraid of further losses due to market fluctuations and close the position early, only to see the market surge afterward, missing out on a significant profit.

Or when the market reaches the stop-loss level, it feels like cutting flesh, and it's hard to take that step, thinking that if they hold on a bit longer, the market will surely turn around, but in the end, they lose irreversibly.

Many people simply cannot exercise self-discipline. No matter how proficient they are in their skills or how much they understand the principles, they cannot restrain their desires. What should they do?

First and foremost, we must confront the psychological issues that exist within ourselves.Most traders are self-taught and are like wild traders; it is quite normal for us to have poor trading habits and psychological issues. For instance, we may have an addiction to watching the market, sometimes being too gambling-oriented, always inclined to go for heavy positions, and yet unable to manage them properly. We may be unwilling to admit defeat, stubbornly refusing to cut losses. We might have a heavy sense of regret and be very anxious. When holding positions, we are often indecisive and cannot hold onto profits, among other issues.

These are problems that most of us have experienced, and everyone's issues are strikingly similar. So, there is no need to feel ashamed or regretful. Since we have experienced them, we must address them.

We can list our common mistakes, write them down on paper, and place them where we can easily see them, confronting our own human weaknesses. This requires us to let go of our vanity and seriously examine ourselves. Many people think the market is our enemy and that trading is against human nature, but in reality, the biggest opponent is ourselves. Confronting our own problems is like confronting the opponent's problems, and only then can we possibly defeat the opponent.

Psychological issues are resolved gradually, not overnight.

Too many people are too eager for quick success and instant benefits, thinking that once they discover a problem, they want to solve it immediately. However, trading psychology issues involve your long-standing trading habits and require slow and steady changes.

For example, if we are addicted to watching the market, and we find ourselves checking the trading software on our phones or sitting in front of the computer whenever we have a moment, always itching to trade, let me share my solution.

1. Develop a detailed market-watching plan, specifying the times for watching the market, and avoid looking at the market outside of these times. Set all orders with limit orders and alerts, and do not look at the market unless an alert sounds.

2. Do not let the software remember the login password. Each time you need to enter the password to log in and view the market, make it inconvenient by not allowing the software to remember the password. I also set my password to be very complex, such as "buyaoluanzuojiaoyi" (Do not trade recklessly), so that every time I enter the password, it serves as a reminder to myself.3. In the product list of the trading software, only keep a few varieties that you frequently trade, and delete all other varieties. This way, you won't inadvertently see the market trends of varieties that are irrelevant to you, and it can also prevent you from seeing some "good opportunities" that you can't resist taking action on.

By self-disciplining through these steps, my "urge to watch the market" has improved somewhat. Over time, I've gotten used to the rhythm of not watching the market, and I feel much more relaxed overall.

Take this as an example; if you have other trading issues, you can also make a plan for self-discipline. It takes 21 days to form a habit, and over time, you can gradually break bad trading habits.

4. How to solve the problem of capital?

In addition to technique and mindset, the most fundamental issue in trading is our capital.

Common problems fall into two categories: one is where our principal comes from, and the other is how to grow small capital.

Many traders ask me, now that they have a stable trading strategy, is it possible to trade with borrowed money or to borrow some money for trading?

My answer is always: absolutely not.

Because no matter how stable or excellent your strategy is, once you are in debt, the psychological pressure is at least multiplied by 10 times, making trading extremely anxious. Trading is already a great test of human nature; how can human nature withstand such pressure multiplied by 10?

Therefore, the source of your principal can be your usual savings, your spare change, or the wages you have painstakingly accumulated bit by bit. Just like the money I saved through so much hardship in Africa, after returning to my country and losing it all in trading, I was not in debt, and there was still a possibility of making a comeback in life. But once in debt, the future becomes very bleak.So, avoid debt, which is the most basic requirement for trading.

Can small capital become large? How can it be achieved?

Many people may only have tens of thousands of dollars, or even less, for trading. However, the original desire is to double or even multiply this money by dozens of times, which is the original sin of losing everything.

To achieve stable profits, having a reasonable profit expectation is very important. For small capital to grow, the most reliable method is through compound interest, befriending time.

Let's do some calculations. Suppose our annualized return on trading is 36%, with an average monthly return of 3%, and we use the method of compound interest for trading (or adjust the position once every time the principal increases by 3% for compound interest trading).

After 24 months (2 years), the principal can be doubled.

After 48 months (4 years), the principal can be quadrupled.

And after 120 months (10 years), the principal can grow to 34 times, which would be a fantastic return on investment.

If you start trading with 50,000 dollars, after 10 years it would be 1.7 million. Please consider, for an average working class, accumulating a capital of 1.7 million in 10 years, with an average of 170,000 dollars per year, is truly a very high income level.

Therefore, we must have full patience for the matter of trading profits. Even the majority of Warren Buffett's wealth, 99% of it, was earned after the age of 50, and his wealth truly experienced exponential growth after the age of 60. It is said that when he started running the company, his principal was only 170,000 dollars, and it took him 6 years to earn his first million dollars.There are too many myths in the market about getting rich overnight. Many people and institutions will extend an olive branch to you, offering to lend you money and technology, but where can such free lunches fall from the sky? It might be a precipice just around the corner, so never take the bait.

The success rate in the trading industry is very low, as trading itself is a very difficult endeavor. Many traders become blind once they suffer losses, holding onto a tangled mess as if it were a ball of yarn, unsure where to start untangling. If you cannot sort out the issues, the knots will accumulate more and more, becoming increasingly difficult to untie.

If you have read the entire article, put down your phone first, find a pen and paper, recall the technical and psychological issues that have arisen in your trading, write them all down on paper, and start solving them from the simplest problem. Untie the small knots first, then move on to the larger ones.

Finally, integrate the parts into a whole and achieve stable profits.