The translated HTML is: Can you perform forty-eight moves?

“Forty-Eight Methods” (shi-juu hachi tte) originally referred to a set of definitive moves in sumo, a term said to have been used from the Muromachi period (14th–16th centuries). The exact number was not literally 48, but 48 is a lucky number often used to convey “there are many decisive moves,” hence the name Forty-Eight Methods.

In the world of financial markets there is also something called “Sakata’s Forty-Eight Methods.” It involves analyzing daily candlestick line patterns as a collection of multiple components to gauge turning points and momentum in market movements. The 48 patterns, whose origins are unclear, have taken on a meaningful and distinctive name and have been used for market forecasting.

Regarding these Forty-Eight Methods, Kohta Hayashi (Keitaro Hayashi) explicitly denied them in several of his books.

Chugen Sen Tate Gyokuho — The name sounds old-fashioned, but there is no need to change it. While Homa Munekazu’s Sanmai Den of Japan is called the Bible of the markets, and yet contains no concrete descriptions of buying and selling methods, and is suspected of being a posthumous forgery, Chugen Sen, though concise, specifies buying and selling from the first to the tenth in concrete terms.

Chugen Sen has a long history and has been used by many practitioners, yet it has not degenerated into the realm of the so-called “Shallow Go” or “Hobo Shogi techniques” seen in the versions of the Sakata pendulum method’s sell lines and buy lines. Is it not likely that serious practitioners used it only for the purpose of mastering the fundamentals of trading?

(From ‘New Edition of Chugen Sen Tate Gyokuhou’ Part 1 Commentary)

There are counterarguments to historical considerations, but still, the part about arranging 48 patterns as if they were a mnemonic is suspicious.

There are also Forty-Eight Techniques of sex in the world, and I think few people fully grasp them all, but in the old days one could obtain odd books and now one can look at illustrated lists on the Internet. As I looked through them one by one, progressing to three or four, I would sometimes think, “Could anyone actually perform these positions?!” and feel a little embarrassed.

Returning to Sakata’s Forty-Eight Methods.

Some patterns seem to fit the principles of observing price movements, while others perplex me—how should they be interpreted? Overall, they feel difficult to apply to real price movements for actual position management.

After all, forecasts like “this shape will rise” or “if this, it will turn downward” have some validity but are not absolute. Practicality requires considering entries to exits in a coherent manner and preparing concrete responses for when predictions are correct or wrong.

At Lin Investment Institute, we are currently focusing on disseminating the Chugen Sen Tate Gyokuhou, because it constitutes a highly balanced and complete methodology that integrates a forecasting method, position management, and capital management into a single, well-developed technique.

The prediction method in Chugen Sen is truly simple. It uses pattern analysis with a closing-price line chart. Rather than listing unorganized various cases of “if this then that,” it clearly presents straightforward criteria for judging strength or weakness. Then, by adding a three-way position management, i.e., rules for increasing or decreasing positions, the method and position method are completed. As a result, one can align the individual answers with their own sense of judgment, which is highly valued.

Market strength, in other words, whether it will go up or down, is actually unpredictable.

Sometimes you board a rising train only to find it going down...

If you buy a ticket and approach the train and decide “this is the wrong direction,” you would waste the money you spent on the ticket by returning to the gate... Without such initial responses, a trading method cannot be practically useful. The part of the “forecast method” is, to put it bluntly, just a trigger, and what matters is the ongoing judgments needed while holding a position.

Now, even if you boarded a train and it moved in the expected direction, if you are not careful, it may suddenly head in the opposite direction... This is the reality of the markets. Therefore, the correct approach is to continuously reassess forecasts at every moment and decide the “next move.”

Trading is not a game to predict in three months whether it will go up or down “right now.” It is not that all forecasting-focused thinking is useless, but unless it is paired with concrete action guidance, it cannot become a practical methodology.