Previously, I often discussed this issue with friends. It was either the inability to achieve stable profits or the profits were stuck at a bottleneck, unable to rise any further. At such times, some people would elevate trading to the level of a philosophical concept, and also bring in some philosophical ideas. Of course, the principles are very reasonable, but most of the time, they make the act of trading more complicated and less down-to-earth.

In fact, trading is a very simple thing. To achieve stable profits, all that is needed is an effective trading system and a calm trading mentality. Then, just execute your trading system properly; that's all there is to it.

So let's not overcomplicate the simple. I'll talk about how to break through the bottlenecks in trading techniques and psychology.

How to solve the bottlenecks in trading techniques?

I have communicated with thousands of traders and have been asked many technical questions. Some are stuck on indicators, some on entry points, some on the profit-to-loss ratio, and so on. Some friends are even stuck on more than one point, unable to figure out any of them. Here, I will provide a solution to overcome technical bottlenecks.

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1: Categorize all your technical issues. For example, divide the technical problems into four categories: which ones pertain to judging the trend of buying or selling, which ones are about entry issues, which ones are about stop-loss and take-profit issues, and which ones are about money management issues. After categorizing, you will discover where your main problems lie.

2: Start solving your problems one by one, addressing one issue at a time. I will teach you a method here. For instance, if you have doubts about the entry criteria and are unsure which indicator to use, then just change the variable of the indicator and test the overall strategy on a backtest or a demo account. Naturally, you will find the answer. Each problem in trading can be solved in this way, but only one variable can be changed at a time; otherwise, when everything is a variable, it will only lead to more confusion.

Including if your profits are stuck at a certain level, you can also improve your trading profitability within your tolerance range by changing one variable after another, such as indicators, indicator parameters, entry criteria, profit-to-loss ratio, success rate, etc., and testing one by one. How can you greatly increase your trading profitability within your own tolerance range? This can be measured bit by bit.

No one can diagnose your bottleneck for you; in fact, it's more about testing your own limit values on your own.How to Break Through the Psychological Barriers in Trading?

In fact, trading psychology is closely related to trading techniques. Once you've resolved the technical issues of profitability, there will be some improvement in your trading mentality.

Of course, human nature is very complex. It is essentially impossible to completely detach from human emotions when trading. As a seasoned trader with over a decade of experience, I still encounter psychological issues, but they are much better than before.

Many friends have raised the same questions to me, such as always being unable to hold onto winning trades, or always unable to control the urge to trade frequently. There are many trading demons, and there is a complete lack of patience to wait. What should one do if they lack the determination to trade? Let me share my thoughts on how I've addressed trading psychological issues over the years.

Firstly, I would step out of the problem itself and look at the essence of the issue.

For example, why can't one hold onto winning trades? It's because of the fear of giving back profits, the fear of losing something that was hard-earned, and the fear of stopping losses. But why does this fear arise? It's because we don't know what the future holds; fear comes from the unknown.

So, the problem to solve at this point is how to have enough confidence in one's trading strategy. That comes from practice, continuous practice and testing, so that you can know the limits of your trading strategy, how much you can lose at most, how long it will take to lose, and whether it can really achieve profitability in the long run. If profits are given back, what are the consequences, etc.? All these things will be experienced during the process of testing your trading strategy.

When you understand your trading strategy well enough, you won't have such a strong fear mentality. You'll realize that each trade is just a small part of your trading journey and won't have much impact. You should take profits when it's time to take profits, and hold positions when it's time to hold positions. There's nothing to be reluctant about, and there's nothing to be afraid of.

The inability to hold onto winning trades, at its core, is most likely due to not having a well-developed trading strategy, or even not having a trading strategy at all. That's why each trade is approached with trepidation and fear of the unknown, and that's why one is defeated by their own human nature.

And why is it that some people can't control their urge to trade frequently? Some people like to blame the market, some blame the market makers, and some blame the trading instruments, etc., but few people are willing to face their own weaknesses in human nature.If you don't have your own rules in trading, the market becomes a giant casino for you, and gambling is addictive. Watching the fluctuation of candlestick charts and the changes in numbers, few people can possess absolutely strong self-control.

Making money in trading is as satisfying as eating high-calorie food when you're hungry. People tend to unconsciously avoid pain and pursue pleasure, and doing whatever one wants is the easiest thing in the world, while possessing self-control is the hardest.

That's why I've always liked a phrase from the "Analects of Confucius": "To follow what your heart desires without overstepping the bounds" is the most difficult and wisest thing in the world.

So, since we cannot overcome the powerful human nature, we can also find ways to avoid it. For instance, if you can't resist frequent trading, set rules for yourself, such as not looking at the market for a certain period and only placing orders, to forcibly break the addiction.

At the same time, step out of that "self" and look at yourself from a third-party perspective. Is it very crazy and irrational? Is the self that indulges its human nature very ugly?

Gradually, over time, you will find that as long as you stay away from the market for a long time, you won't think about it as much. Looking back, you will also feel that your past self was very foolish. Only when you truly calm down can trading potentially get on the right track.

Maintaining a certain distance from trading and learning to view yourself from a third-party perspective, to correct yourself, is much more effective than receiving miscellaneous advice from others. I have also come this way, and I encourage everyone to do the same.