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A seasoned trader who has been rooted in Australia for many years once said: ordinary retail investors survive in the financial markets by four words: small positions drift.
But this sounds simple, how does it work in practice? You set your stop-loss, and the price moves as if it has eyes, heading straight for your order. Once your stop-loss is triggered, the market turns around and skyrockets in the direction you originally expected. Feels like the market is targeting you? If this is your daily experience, then you should read this content carefully.
Honestly, in short-term fluctuations, individual funds and technical analysis simply can't compete with professional institutions that control large amounts of capital. Your stop-loss is often set at the "standard" positions on textbooks, which is essentially providing liquidity to your opponents. Being wiped out is only a matter of time.
So what should you do? The answer is to abandon short-term predictions and switch to long-term trend following. Here, I share a trading system based on five core principles:
**Principle 1: Focus only on the big cycle direction.** Forget about small fluctuations like 15-minute or 1-hour charts; focus on the daily or even weekly structure. Whether it's an uptrend or downtrend is clear at a glance. In an uptrend, go long; in a downtrend, go short. Remember, the market doesn't belong to the smart; it belongs to those who follow the trend.
**Principle 2: Strictly control position size.** Always keep your trading capital within a safe range. Even if you make several wrong calls in a row, your principal won't be hurt. Maintaining a calm mindset allows you to survive longer.
**Principle 3: Wait for pullbacks to enter.** After confirming the main direction, don't chase highs; wait for the price to pull back to support levels or show signs of stopping falling before acting. Only act when you see signals. This is trading, not gambling.
**Principle 4: Set wide stop-losses.** Since you're trading on a big cycle, your stop-loss should have enough room.
**Principle 5: Let profits run.** Once the trend starts, loosen your grip; avoid frequent take-profits and cutting profits short.
The core of this system is—follow the big trend, stay disciplined, and aim for longevity.