March 20th Trading Strategy Record.

What is the most important thing in trading? Trading strategy.

When we buy an asset, we can go long or short. But the most important thing is that you understand why I am buying here.

That is the first point I want to mention: the buy signal.

1. What is a buy signal?

First, we need to clarify one thing. No one knows how the market will move afterward, whether it will continue to fall or rise. So, a buy signal is an indicator or signal that appears during all upward phases. For example, during an uptrend, certain conditions will always occur: moving averages form a golden cross, MACD lines cross above zero, or candlestick patterns show higher lows and higher highs. These are all signs that an upward move is likely. The same applies to downtrends.

Many friends might ask: does this mean it will definitely go up or down when these signals appear? Of course not. So, what does this buy signal mean?

As I mentioned earlier, we don’t know if the market will go up or down afterward. So, when we buy based on this signal, it’s a probability. The key is how to profit from this probability.

Once we have a buy signal, the market can only do three things afterward: 1. Continue to rise (or fall) as expected; 2. Move against our expectation; 3. Enter a consolidation or sideways phase.

When we get a buy signal, these three scenarios give us three points: the stop-loss point, the add-on point, and the take-profit point.

For example, if we buy when the moving average forms a golden cross, and the market continues to rise along that signal, we can hold until we reach a significant profit. Conversely, if the market turns into a death cross and starts falling, we set a small stop-loss to avoid bigger risks.

In my words, it’s about capturing large waves of upward or downward movement and avoiding big risks during sideways consolidation, which only results in losses due to fees.

Trading itself isn’t very difficult. The hard part is that many times we don’t want to admit our failures, or we buy based on feelings without understanding why. When there’s no clear buy signal, problems still occur afterward. When losing, we don’t know where to stop; when making money, we don’t know where to add or exit. We follow human instincts—holding on through the ups and downs, and taking profits too early. This cycle makes your capital curve look terrible.

So, when trading, don’t listen to others or big traders claiming that the market will definitely fall or rise today.

Most importantly, when you see a signal on the candlestick chart indicating a buy or sell, act accordingly. If no signal appears, patiently wait. Only by doing this can you secure big profits and know where to cut losses.

Every action should be guided by signals, not feelings. Support levels and resistance levels are just points or patterns used within the industry for taking profits or cutting losses, not actual pressure or support zones. When you have free time, feel free to leave comments below this post. I will respond to each one.