In this market, there are nine types of thinking that are used for investment purposes.

1. Scalping Mindset (Arbitrage)

What is scalping mindset? In essence, it's about making profits from price differences.

This is the most fundamental scalping mindset, which involves buying and selling. Whether you go long or short, the key is to profit from the sufficient price difference. It's a very short-term operation, and this kind of arbitrage trading.

Therefore, it's about frequent trading; if it's medium or long-term, it's no longer considered scalping.

2. Sniper Mindset (Identifying Key Levels)

The so-called sniper mindset refers to identifying key levels. Who is the representative figure for this? It's George Soros.

When Soros was shorting the British pound, the price of the pound was severely overvalued, having reached a historical peak.

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At this time, Soros, representing the short-selling force, shorted the pound at a high level, which led to its eventual sharp decline.

In the market, the price of a particular asset, whether it's the British pound or the price of other commodities, always reaches an exorbitantly high level.Exorbitant prices are the key prices, the critical points. At such times, whether one is short or long, whether the price has risen to the peak of a bubble or has fallen far below its intrinsic value, these are all good sniping points. This is called sniping thinking.

3. Momentum thinking (hot spots and popularity)

Momentum thinking mainly refers to hot spots and popularity, using them to make money. What is similar to this? It's like the way we speculate on topics and focus on events in the stock market.

In our market, there are many such cases. People often ask me what I do. I say I'm in financial investment. Many people have a misconception that financial investment is a scam. Why is that?

There are many capital pools in the market. They use hot spots and popularity to drive up the price, similar to a variant of pyramid schemes. So they use hot spots and popularity, for example, the stamp and coin cards of a few years ago, to continuously drive up the price, encouraging everyone to keep taking over, pushing the price up continuously.

So when this makes money, everyone comes in, and it only rises and doesn't fall. Is there anything in the world that only rises and doesn't fall? This is using hot spots and popularity, called momentum thinking.

4. Business thinking (Buffett)

Business thinking mainly refers to Buffett's method of operation. He sees a stock, which is issued by the company, and that company is a valuable company, and it is also a company with promising potential, but the current price is severely undervalued.

So at this time, Buffett would buy a large amount of its stock, even become its shareholder, or even completely control the company, manage the board of directors, and become the real boss of the company.

For example, a stock should be, say, a thousand dollars, but now the price might be only three or five hundred. At this time, it is severely undervalued. At this time, to intervene, to invest with Buffett's business thinking, this is what we call the so-called business thinking.5. Volatility Thinking (Non-Farm Volatility Range)

What does volatility thinking refer to? It is a concept familiar to those of us who often deal with foreign exchange, specifically the volatility range of non-farm data. Generally speaking, the non-farm volatility range of the previous year is quite significant. When the fluctuation reaches a certain extent, many people capitalize on this range to make money, which is what is known as volatility thinking.

If the non-farm data causes a sudden fluctuation of three thousand or five thousand points, and it moves in only one direction, then by simultaneously taking a long and a short position, one position might be liquidated, while the other could earn several or even dozens of times the initial investment.

This kind of volatility thinking can lead to windfall profits, which is the way of thinking that leverages volatility.

6. Cyclical Thinking (Holding a Losing Position Until It Turns Profitable)

I have previously explained the nature of the market to you, and many people might understand it: after the market rises, it will fall, and after it falls, it will rise. Although the extent of the rise and fall may not be as perfectly consistent as a sine wave, it always follows the pattern of rising and then falling, and then rising again after falling.

Some people have discovered this pattern and have adopted a strategy where, if a trade does not make a profit and gets stuck, they will not take a loss and exit; instead, they will hold on, persisting until the market fluctuates back in their favor.

This way of thinking about making money has its merits, but the method is extremely risky and can easily lead to a margin call.

In this market, there are many so-called cunning petty swindlers, professional fraudsters, who take advantage of this. For instance, if they use $10,000 and only trade 0.1 lots, the fluctuation range is limited. Under normal circumstances, as long as there is no significant one-sided market movement, the floating loss is around 30%, not too much, and they can hold on until it comes back. Although the time they hold might be one month, two months, one week, two weeks, or even half a year or a year, they will hold on until it turns around.So we understand that the market is mostly in a state of fluctuation, right? 70% of the time, the market is fluctuating, whether it's large or small fluctuations. Therefore, he takes advantage of this to be clever and holds onto his positions, making a small profit and then leaving.

People will see that his trading records look very impressive, all blue, making small profits and running. You see his trading records are all profitable, all making money, it's all one-sided profitable orders.

As an investor, this kind of trading is very appealing, why? Because it looks good, it's always making money, which can easily deceive those who don't understand.

However, this trading method has no technical content, it's completely about holding positions. Once a volatile market is encountered, if it's too large and cannot rebound, it will lead to a margin call, not just a 20% or 30% unrealized loss.

He is facing a margin call because, for example, some large commodities have very large fluctuations. If it's a one-way move, it could be more than 10,000 points, and the account is gone.

Another issue is what? If he is operating this kind of position holding, his profit is very meager. This profit is too weak. We know that trading is meant to make money, not to lose it.

In this situation, you make little money, even if he is very lucky and can always hold back, but the profit is too thin because he dares not to use a heavy position, the profit is too thin, so the money made is very limited.

7. Chip thinking (main capital)

Chip thinking, also known as main capital, is actually the method of following the big players.

Following the big players, the main capital decides the direction, especially in the stock and futures markets. Sometimes the main capital can influence the market. We say that the main capital is not always influencing the market. But there are times when it does have an impact on the market.Within a certain period of time, at this very moment, we need to understand the direction of the main force's capital, its chips, and its investment direction, which is very advantageous for us when we are in the game of competition. I don't need to explain much, so as soon as I mention it, everyone understands.

8. Arbitrage Thinking (Interest Rate Arbitrage)

The so-called arbitrage thinking is actually about interest rate arbitrage, price arbitrage, and so on. For example, let's say Tangshan, a major steel-producing city in China, where the production is all in Tangshan, it should be the first in the whole country.

Suppose I just give an example casually, for instance, if a ton of steel is 50,000 yuan, and in Tangshan it is 50,000 yuan, but if you go to Xinjiang, it is 60,000 yuan, there will be a price difference between the two markets, and there will be a flow between the two markets. Some people will arbitrage the price difference.

If the cost and transportation operating costs can offset, and if it does not exceed 10,000 yuan, he will have a profit margin and will arbitrage the price difference.

In the foreign exchange market, there is something called interest rate arbitrage. For the same product, some platforms offer interest, while others do not. So, when you are long on one platform and short on another, if one platform gives interest when you go long and the other gives interest when you go short, at this time, you are simultaneously long on one platform and short on another.

Both platforms give him interest, but in terms of price fluctuations, one is profitable and the other is at a loss. He moves from one hand to the other, the price does not change, and the overall account net value does not change, but he continuously harvests interest because both sides are giving him interest. This is called interest rate arbitrage.

9. Logical Thinking (Causal Logic between Events)

The thinking of the vast majority of us is actually quite simple, it is causal thinking, because of what? For example, gold.

I often use gold as an example. Gold has a safe-haven attribute, and there is an old saying, "When the cannon roars, a thousand taels of gold."If a major war occurs between major powers, causing global instability, people will buy a large amount of gold based on the need for risk avoidance. Therefore, there is a causal relationship between these events. Operating based on the connection between cause and effect is what we call causal thinking, which falls under technical analysis.

Alright, that concludes today's lesson, which mainly covered left-side trading, right-side trading, self-created strategies by the public, and nine types of thinking within technical analysis.

That's all for today's content. Welcome everyone to follow, like, and share!