Market Observation and the Recommendation of Stop-Loss

When the market is moving

Stop losses are unfavorable

Trading the market in one shot is even more unfavorable

We must trade the market while averaging in (scaling in)

Changing the currency of the market and re-trading is meaningless

Because it moves in the same way and is correlated, it ultimately causes round-trip losses

Ninpin (averaging in) is the correct approach, but if you think the opposite, if you're wrong it will be only round-trip losses

When aiming for the market’s correct move with a stop loss

Unless you’re trading with observations on the 30-minute and 1-hour charts, it’s completely meaningless; losses will only increase

Averaging in should profit from intermediate market movements

Holding a position without cutting losses (hedging) has meaning

The market is faithful to the time-frame chart

Therefore, if you’re trading, it should be under a post-trade (ongoing) and averaging-in framework

Which direction the market will move is uncertain due to pullbacks; hence the advantage tilts toward averaging-in or post-trading regimes

Trades without stop losses will hardly profit unless you adopt a post-trade approach

Averaging in is hard to endure, so

If you choose post-trade, starting with stop-loss trades will be far more efficient

Post-trade averaging in will only incur losses due to market relationships

Control your desires

Become able to increase capital through stop-loss trades

Become able to increase capital through manual stop-loss

Basically, you can win with averaging in, and you can win with post-trade averaging in

But if losses deepen, it becomes harder to consider post-trade

Winning with averaging in happened because the market direction changed

Market direction changes are a matter of strength and weakness and reflect a long-term market

Everything is recursive, so nothing is certain

When a trend appears, the ability to promptly switch to post-trade averaging in with decisive thinking is important

Do not add to the previous lot size with post-trade; start with the initial lot size—that is the iron rule

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