The principle of the first nature of the transaction can be summarized as follows: “the only certainty in the confusion of price fluctuations is your rules of response; the only control is your margin of loss.”
It can be broken down into two bottom facts that cannot be further simplified。
Market level, prices are unpredictable
Any price movement is the result of an instant game of numerous independent decision makers, and there is no cause or effect that can be reproduced by 100 per cent。
This means that there is no way to guarantee that the next line will rise and fall。
This is the bottom “uncertainty justice” of the transaction. All the starting points for profit stem from your recognition and acceptance of this, not from an attempt to defeat it。
At the behavioural level, you can only control your own input, not the results
You can't decide whether the market pays you a profit, but you can decide:
When to enter (rule-based)
How much did you put in
When to recognize departures (cut off)
When will the bag be set
The result is random feedback from the market on your input (rules + enforcement). A single gain or loss is meaningless, and long-term statistics are effective。
Trade logic chain derived from the first principle
Prices are unpredictable (first principle)
Any single transaction could lose
The maximum loss must be locked in the rules
Systems that must rely on positive expectations (probability)
Need for consistent implementation over time (realization of probabilistic advantage)
Final profit = f (system expectations, execution consistency, time)
The first principle of transactions: markets are unpredictable and rules can be relied upon; results are uncontrollable and losses can be locked。
The certainty of rules to deal with market uncertainty; the controllability of small losses in exchange for the probability of large profits。
Thank you for reading
Personal views, for information purposes only。
