Reason why profits can keep rising: Column currently published on Toyo Keizai ONLINE

Good morning, this is Matsushita.

Yesterday's Dow Jones rose again.

The Shanghai Composite Index continued to fall.

USD/JPY continued to rise to the upper 111 yen range.

NY Gold fell back.

The other day at Makoto Investment School

in the Investment Skill Development Course,

a question came from one student.

“Why can you construct buy/sell scenarios so clearly, teacher?”

I didn’t understand what that meant, so

when I explained a little more, in a situation where the future price

movement is not known, how do you concretely

control buying and selling,

and what is the reason you cannot understand this?

The answer is simple.

In my head, I can clearly imagine the movement of future prices.

Because future price movements

are the same as price movements that occurred somewhere in the past.

If we think about which part of the past the upcoming price movement

will be the same as,

we can visualize the future price movement.

And it will hit with a certain probability.

To explain it a little more simply,

the movement of charts is always the same anywhere and anytime.

The chart of the British stock market 100 years ago,

the chart of Japan’s commodity market today,

the chart of a currency at some point 100 years from now,

all have the same shape.

The Tulip Mania chart from the Netherlands in the 17th century,

the Japanese asset bubble chart of 1989, and

the IT bubble charts from 2000–2001 are the same.

This is the meaning of trends and characteristics.

The legendary speculator Jesse Livermore

said the same thing over a century ago.

“What is happening in today’s market has happened before,

and what may happen again in the future.”

(From the book “Markets of Desire and Illusion,” Toyo Keizai Inc.)

The shape of the chart is always the same.

Therefore, investors who profit

constantly confirm and analyze past chart movements,

are seeking the source of future profits.

Without being swayed by predictions or market news,

they continue to verify the past.

And this year, and next year,

and even ten years from now, they will continue to profit.

The difference in thinking and behavior between

profitable investors and those who lose money

also exists here.

Until you bridge this gap, you will not become

a profitable investor.

Learn the thinking and actions of profitable investors,

and imitate them.

The shape of the charts is always the same.