After thirty years of devoted enlightenment, can this sword break through wind and waves?

First praise, then watch, earn 90 million a year! [Taoguba]

Thirty years is enough for a child to grow into an adult, enough for a story to settle dust, and enough for me to turn a single brave heart into a silent sword. The hardships and grievances along the way, I never tell others in detail, only swallowing all fatigue alone in the lonely night, just waiting for a moment of sudden breakthrough.

Recently, many investors are losing money, blaming the market’s sharp decline, and rampant quantification, but I want to say, we are not qualified to complain about unfair fate, because this is the fairest starting line to change destiny, the best platform to grow wealth stronger. We are fortunate to stand on this starting line, while many others, for survival, may never dare to try in their lifetime. How lucky we are.

The above profit chart has no other meaning, just to say that the market will definitely have a way to let us survive. Many fans say they lost terribly, but how do they know how much hardship we old pros have experienced? To compare misfortune, probably no one has suffered more than us.

From 1996 when I entered the market to 2005, the market fell below 998 points, I lost 10 houses (we had demolition + borrowed funds), my account was my only hope, I dared not withdraw a penny. At the worst, I survived on one yuan a day, enduring until 2006, 2007’s big market year, then I turned around completely.

In this round of market, I learned the importance of risk control, successfully escaping the top in the 2008 bear market.

During the 2015 stock market crash, I lost over 2 million in one day, first time encountering a thousand stocks hitting the limit down. But I also escaped the top in time. That year, my quantitative strategy saved me. I wouldn’t re-enter the market because of policy-driven market rescue (many believed in the rescue but forgot market laws; re-entering led to total loss).

A friend advised me to trade silver futures, losing 700,000 in one minute, my mind went blank. Only those who have experienced it will understand. This also led me to avoid gold, silver, crude oil, and other commodities linked to foreign markets afterward.

In 2005, alone in the deep mountains for two years, not speaking to anyone. When I returned, I found I almost lost my language ability.

I don’t want to say much about this, even Livermore had ups and downs. So, all the hardships you’ve endured are to make you realize that as long as your heart doesn’t die, the way will be born. Everyone in this market must pass their own tribulation.

But don’t complain about the market, don’t blame quantification for losses. Reflect after each loss, find the right trading path, and keep improving. That’s what we should do. Whether it’s the slow bear in 2005, the big bear in 2008, or the 2015 stock crash, these experiences, from a different perspective, are not disasters but wealth. They teach you to keep your heart alive, trade without emotion, and will eventually make you stand high, feeling the loneliness and solitude without opponents.

The above words are just to convey a belief in perseverance.

Back to reality, it’s time for a weekly review. Tabular trading makes thinking clearer: three strategies for a market plunge.

1. Trade the strongest intraday pressure coefficient stocks. Because this intraday pattern shows that even in a market decline, the bullish and bearish ratio can still maintain 90/10. Investors in these stocks are not synchronized with the market fear. You might quantify that the short positions here are less than 10%, unable to change the stock price, while the longs are over 90%, able to hold the price until the next day, providing opportunities for profit and exit. Real case.

For example, Far Sheng did the strongest intraday 90/10 on the first board with flow addition zero, using the market decline to place orders, resulting in missed trades after order leaks; but it’s not always successful because the short positions are too small, depends on luck. On Friday, I wanted to watch Huashuo Holdings’ first board, but didn’t succeed before close.

Have you noticed? I missed out. In this market where everyone complains about the poor environment, there are still opportunities to make money. The only difference is we earn less because we only eat the fish head and body, leaving the tail for others.

Bullish forces come from two sources: one is trend strength generated by pathways, called static value. When trading, confirm this strength, like market pressure testing, high-frequency, same amplitude fluctuations. It’s like assessing military strength before battle, comparing bullish and bearish ratios. If you know the bears are strong, would you go? Of course not. But those who don’t quantify will chase greedily, leading to complex trading mistakes like chasing and stopping losses.

Therefore, before trading, I must manually quantify the current bullish-bearish ratio, based on my emotion conservation law, as accurately as possible. Also, the stocks I observe in a day should be few, because whether in a bull or bear market, we talk about sector rotation. In bull markets, sector rotation frequency is high; in bear markets, low. In structured markets, sector leaders dominate; in bear markets, “bao yao” (big monsters) dominate. This is determined by sector rotation.

Pathway generates static values; themes generate dynamic values. For medium to long-term trading, focus on static values; no need for positive news, use time to exchange for space, and profit. For short-term trading, focus on dynamic values, with pressure testing as auxiliary. Ultimately, my buy or sell decisions depend on dynamic coefficients, not static values.

Dynamic values tell you if it’s strong or not; static values tell you how strong.

Today I read an article by Yuzaixian Liu, titled “Human Trader Vectorized Trading: The Decline Letter,” which is chilling. Has the era of big funds ended? It’s hard to accept. Now I understand why the core dragon disappeared—Ningbo Construction failed four times in five attempts; Sanfangxiang failed five times in six. It turns out no one is passing the baton anymore. I practiced for five years, mainly the core dragon strategy, but it was a waste. Luckily, I also do quant, which counteracts quant. These two can still give some soup.

I’ve never feared quant, thinking it reduces error tolerance when you’re wrong, like a hard landing for wrong trades, making losses faster. But when right, quant should help accelerate gains. Maybe I live in my own world, with a biased understanding of quant. I’d appreciate those who understand quant to share their insights in the comments.

But one force can defeat me: my loyal fans, who beat me with my own quant strategies.

Earlier I mentioned Far Sheng, which relies on theme dynamic values, but also needs to check its pressure test value. The chart below shows it has a long-term pressure test value.

First frequency, second frequency are valid; Tianli (heavenly volume) is not valid if it’s a sky-high price. Flow + zero is valid. In such chaotic sentiment, with daily trading over 1 billion, being able to craft a candlestick chart you want is remarkable. It’s like a blooming flower. Why not value it? Sadly, few paid attention that day.

Quantification counteracts quantification; human funds should also upgrade.

2. When the market plunges and you can’t find high-pressure coefficients, use double break strategies, like Meiliyun.

90/10 ratio helps you not fear the market; double break helps the market clear out floating chips. So, either you are fearless or you leverage on the market.

3. Use options hedging, such as put options during market declines.

This can also be called tabular trading: pick a stock, trade it, without emotional interference or guesswork, relying solely on static and dynamic quantification.

I’ve shared some market laws based on human emotion changes, which persist because they are rooted in human psychology. Someone asked me to learn Dow Theory or MACD, I said, only if you created those theories yourself. Because only a self-created trading system can have a certain charm, a kind of spiritual resonance.

Today I’ll talk about options, taking Friday as an example. But options are risky. Every time I share about options, I emphasize risk. Always control your capital invested. Strongly recommend not exceeding 1% of your stock account for options. For example, if your stock account is 800,000 yuan, don’t invest more than 8,000 yuan in options. If you lose 8,000 yuan, stop for at least two months. Otherwise, the path I lay out today is not to help you but to harm you. Please understand.

Options are divided into two types: one is dazzling, the other is semi-transparent.

What is dazzling? The main options contracts have three.

The three axes refer to Shenzhen Index. If all three puts surge during a big decline, it’s “dazzling.” If Shenzhen drops sharply but the three contracts are not synchronized, then you need to analyze the three lines’ co-movement. Find which one’s decline is most obvious; that’s the highest coefficient. The one with the highest co-movement is the main.

On Friday, first check the direction of the three axes. The chart below clearly shows a bearish trend.

Second, compare the three co-movement values.

From the above three charts, you can see that the first chart’s bearish power is strongest. The second and third charts show deep water battles around the green zone, with low centers of gravity. The first chart is near the red zone, rising. Using the three-line co-movement, find the main contract. Then, find the dynamic value. The most common dynamic value in options is the intraday 4-cycle ACBC2, where C2 is the entry point.

Options are not very complicated. The key is to correctly predict the direction, just like stocks. Don’t have preconceived notions. Under certain conditions, options can be more advantageous than stocks.

1. T+0 trading allows correction of direction anytime during the day. Of course, T+0 has pros and cons. The right trader can correct direction on the same day, placing chips in the correct direction; the wrong trader keeps cutting losses, increasing losses.

2. More stability. The three options varieties are not single stocks but baskets: 50, 300, 500 stocks.

3. High leverage + good allocation. The same contract offers 10x to 10,000x options. You can amplify leverage when success rate is highest (no margin for options, risk is losing your entire capital, so control your investment proportion).

Personal opinion, for reference only.

I wonder if everyone understands. If you can actively control risks while practicing XI, regardless of the strategy, it will be stronger than many outside methods. More trading strategies can also attract more fans and increase the article’s popularity, helping me become an excellent blogger on Taoguba. My second goal is to be a top trader, and you are to become an excellent trader.

Remember, I want to be an outstanding blogger on Taoguba, and success depends on you; you want to be a top trader, and I will always accompany your growth! We should achieve each other.

Remember, trading should be emotionless. When I communicate with everyone, I notice many carry emotions. Be aware: emotions lead to preconceived notions and illusions. I only get emotional about trading call options or likes, because my energy can’t keep up. I don’t read all posts immediately; I may prioritize my loyal fans first. I hope those serious about learning XI become loyal fans early, so communication is easier. In principle, I read all fans’ posts unless I truly lack energy.

Recently, a new student asked how to learn systematically. I am just a professional trader, not a lecturer, so I don’t follow strict categories. But you can learn in these steps. The link to learning XI below is very important; it contains 8 articles you can study repeatedly.

(Pinned on homepage) Wild Man Brother’s Dynamic Quantification of Heaven and Earth, Intraday Rise and Fall to Break the Deadlock — Wild Man Brother — Taoguba https://www.tgb.cn/a/2p3T1qweUCP, mainly about intraday 4-cycle ACBC2.

There are two other key areas to study:

2. Titles marked with “Mind Method” (currently updated 1-7 articles).

3. Three live replay videos on the homepage.

To help everyone better learn my trading system, we will select the most valuable questions from fans each day and provide answers (later, questions with high value can be liked; the most liked will be studied together).

1. A fan asked: In the three-board axe, can the red and green columns also be verified with one-minute charts? Is the direction of the index and options mutually influential, or is the index performance the core?

This is a very good question. The red and green columns in the three-board axe can be verified with one-minute charts. In your view, one minute equals 60 seconds; with billions of trading volume, take Shenzhen on Friday as an example.

The chart shows that quant generally looks at the longest red/green column first, then its width and area. So, the green column in the morning has a larger area, with the center of gravity moving downward. Even if it rises at noon, it can only be a weighted rise. The final direction of the price is determined by the path and acceleration of the center of gravity.

Second, options do not influence the index; they are just premiums, exercised based on index changes.

2. A fan asked: Teacher, is Sanfangxiang a double break? Can it be watched?

I’ve studied this stock too. It shows intraday weak-to-strong transitions on the second and fourth boards. The continuous limit-up signals that the capital columns might be valid. Double break refers to breaking the 5-day moving average and the MA line. Although it breaks the 5-day line, we look at its intraday MA.

The chart shows that although it’s a double break, the decline rate is high, with a coefficient of 3+2+1 leading to a limit-down, making the intraday MA unstable. When it hits the limit down, the MA is unstable, so it has no value for attention that day; even if there is, it’s delayed.

The key point: if the intraday MA breaks and hits the limit down, and the MA is still unstable, then it has no value for attention. The MA must be horizontal to be valid; during the game, MA lines cannot be used for涨跌停, only for normal trading.

3. A fan asked: Wild Brother, what is the principle of double break?

The principle of double break is assuming the largest bullish capital column and the smallest bearish one. If this assumption holds, then bears exist, and their influence is in the smallest units of game—like 5-day, 10-day, 20-day lines. The break should be at the smallest unit, e.g., 5-day line. Not every stock can use the 5-day line; it needs the strongest bullish-bearish ratio, which requires quantification.

So, some stocks rebound after breaking the 5-day line, others after breaking the 10-day, and some after breaking the 20-day. During learning, if you’re not sure your stock has the strongest bullish-bearish ratio, don’t use the 5-day line. The worst coefficient is the “ground volume and ground price,” meaning when bears appear, all MA lines break. Only after the bears release all selling pressure, and the selling volume disappears, can there be a rebound. The lack of selling pressure volume is a shrinking volume phenomenon, called “ground volume,” which is the reason I give up on the “ground volume and ground price” zone C. This is also why, during a big market decline, ground volume and ground price tend to break together—because the bullish side is too small, and the bears too large. Even if you see ground volume, it doesn’t mean the bears will immediately reverse; it takes time to repair, which is why during a big decline, it’s not resistant to falling.

Therefore, my requirement is to trade based on the capital columns. Trading should not stray from the capital columns—that’s the principle.

Today’s XI trading lesson ends here. Propagation is not easy; I hope fate allows us to cherish each other.

Thirty years of short-term practice, 25 years of low absorption, recent 5 years focusing on board hitting, including first boards, consecutive boards, and leaders, all based on my self-created “Emotion Quantification ACB Trading System.”

In these 25 years, two things are hardest: persistently high-frequency ultra-short low absorption, never hitting the board. This has allowed me to survive in this industry. Looking around, few can survive 30 years doing ultra-short low absorption. I only look at volume and naked K-lines, never at MA lines. My path is different from most; I admire Livermore deeply. I’ve read and listened to his “Reminiscences of a Stock Operator” countless times. It’s time to revisit that book. 90% of my system is based on his ideas, like the least resistance line, where prices run along the least resistance; trend following; my cycle pressure test; key point trading; my core pivot strategy; patience waiting; my chaotic time cycle exit; market is always right; when wrong, reflect on oneself; emotion control—never operate with emotion, and how to manage emotions through position sizing.

The second thing is I am not tempted by the huge profits from hitting the board. The main reason is my understanding—my system emphasizes time cycles. My low absorption mode requires C=8 or greater. That means, if the market doesn’t fall enough, I won’t low absorb. Now I understand, hitting the board is C small, 4, so the time cycle doesn’t match. I oppose new investors jumping into consecutive boards immediately.

I used to trade alone, but now I have 20,000 fans, with more loyal fans growing. I not only need to do well myself but also learn XI with fans, communicate, and observe their growth daily—congratulate when they do well, worry when they don’t. There are no teachers in this market; fans like and trust my trading system because I understand more.

On Taoguba, everyone can freely communicate, learn from each other, and share insights. I will also honestly share my trading ideas, market views, and personal holdings.

But I must remind everyone: the platform strictly prohibits stock recommendations and guidance. All my shared content is personal notes and thought exchanges, not investment advice.

Fans can refer and discuss, but must make independent judgments, bear their own gains and losses, and invest rationally. Don’t follow blindly or blindly imitate; stick to your trading principles.

Personal opinion, for reference only.

Thank you for your recognition. Only sincerity in this world is irreplaceable! My wish is to have students everywhere.

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