The lives of many people are filled with busyness and bloat, cluttered with a myriad of complex matters. It's akin to trading, where you might have initially wanted to simply make some money, but along the way, you got lost. You started chasing trends, trying to catch quick profits, seeking shortcuts, delving into extremely intricate strategies, and succumbing to greed and irritability, only to end up with nothing.

Many individuals complicate their trading endeavors, learning more and more, becoming increasingly obsessed with technical analysis, yet forgetting the fundamental purpose of trading, which is to make money.

I too was once mired in this mindset, unable to extricate myself for a long period. It wasn't until I lost all my capital and underwent a complete self-purging that I gained a fresh perspective, understanding that simplicity is the essence of truth.

Some of the simple technical methods I once disdained have, in fact, become the backbone of my livelihood. Today, I share my personal journey and some straightforward examples so that everyone can clearly understand why we should pursue a simple trading system.

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1. Simple things are more focused and easier to implement.

The effectiveness of many people's trading systems is poor because they fail to make choices, wanting everything, which results in an overly complex system. For instance, you might have a trading system that is profitable when executed, but it misses out on some market movements, especially major trends. In your frustration, you try every means to adjust the system parameters to capture these trends, only to find that it affects your previous orders.

After years of patching and tweaking, the system settings become increasingly complex, but you haven't made any money; instead, you've suffered significant losses.I was once also obsessed with finding a "perfect trading system" that could capture all market trends, generate high profits quickly, and ideally have no losses at all. However, reality slapped me in the face.

Later, I let go of this obsession and began to consistently and extensively execute a simple trading system, focusing on just one type of market trend, which turned out to be slightly profitable.

The feeling at that time was like discovering a new continent. Moreover, when you only trade one type of market trend, you will find that the changes it generates are relatively fixed.

For example, if you work with a fixed candlestick pattern for a long time, you will feel that you have seen this pattern many times. Although you cannot be sure exactly how the market will move after this pattern forms, you can generally know the few possible changes after the pattern forms.

Do not underestimate this "market sense"; it can greatly enhance your confidence in the trading system, reduce the unknown fear of the market trends, and subtly improve your execution.

In addition to only trading one type of market trend, having simple and clear technical criteria is also very important.

Many traders have very complex technical criteria, with a variety of indicators, messy colors, and various complex trend lines. How can such technical criteria quickly judge the trend and make a profit in real combat?

A friend once shared his technical criteria with me, and the structure of the candlestick patterns was very chaotic, with different indicators conflicting with each other.

There were channel lines, two trend lines, two moving averages, and MACD, all pointing in different directions. Confirming the direction on such a chart is a daunting task, not to mention entering and exiting positions.Moreover, the directions given by the indicators can easily affect the execution of trades. For instance, when holding a short position that should be stopped out, if one sees that the MACD below does not show divergence, and then observes that there is still a considerable space between the current price and the blue trendline support below, considering these two points, the market may continue to fall, so one might wait before stopping out.

However, due to the instinctive aversion to stopping out, one might continuously rationalize, searching for technical criteria in the market that favor one's position, delaying the order to stop out, which ultimately leads to significant losses.

What if our technical criteria were simple? Let me optimize the same market trend with simplicity.

In the same market trend, I have retained only one moving average and one trendline. In this segment, the trend is very clear; the market has broken below the ascending channel line and also below the moving average, indicating a standard bearish trend. At this point, if one is holding a long position, it is necessary to stop out and look for opportunities to go short.

The technical criteria are very simple, with no ambiguity, and no need for indecision. Although it may not look sophisticated, it is definitely easy to execute.

In fact, by comparing, one can easily decide whether to choose simplicity or complexity. Greed leads to nothing, while letting go brings gains.

Furthermore, when you focus on a few indicators, a few types of assets, or a category of market trends, you can delve deeper, have a higher perception of the market, and this is more conducive to trading.

2. Simplicity does not equate to being rudimentary.

People often say "the greatest truths are the simplest," and also feel proud that profits can be made with just a bare K-line chart.Of course, I don't rule out that some people can indeed make profits with a single bare candlestick or an extremely simple trading strategy, but these strategies are not suitable for the vast majority of people, just like a drafty house. You can cultivate yourself to ensure you don't shiver in this house, but I would rather choose to repair and improve the house before living in it comfortably.

Previously, a trader shared with me a trading system based on bare candlestick charts:

Enter a position when a large candlestick strongly breaks through the support level, and hold the position until the candlestick closes weakly, then close the position. He asked me if such a trading system is feasible.

I only asked a few questions: What is the standard for a large candlestick? What is the standard for a strong break? And what is the standard for a weak candlestick close? He couldn't answer.

I continued to ask: For the exit criterion of "weak candlestick close," does a bullish candlestick with a long upper shadow count as weak? Or does the candlestick have to close as a bearish one to be considered weak? Or does the length of the bearish body have to reach a certain proportion to be considered weak?

He said: That depends on the specific situation.

Such a trading system is relatively "crude" because all its criteria are ambiguous. In practical application, it requires very subjective judgment, and it is highly likely that your mood on a particular day will directly affect your judgment of the trend. In this case, it is as if there are no standards at all.

There is also a "crude" trading system:

For example, go long when the price is above a moving average and go short when it is below. Enter a long position when the candlestick closes above the moving average, and enter a short position when it closes below. This trading system is incredibly simple and has clear standards.

However, this trading system also has its issues because it has not undergone any filtering or selection, leading to frequent stop losses and testing one's discipline in execution.In the red circle are the points for opening and closing positions. With at least 16 stop losses over 13 trading days, the account will suffer severe losses.

Sixteen stop losses are not something many can withstand; once the mentality collapses, it's a total loss.

This type of trading system, which is simple in form but extremely difficult to execute, appears to me as quite "rudimentary." It requires traders to have a strong heart and willpower beyond the ordinary, making the execution another level of complexity.

Therefore, a trading system must have clear and explicit technical standards, be able to exclude subjective factors during execution, and be in line with our human nature. Only then can it be considered a qualified trading system, and we can discuss the level of profitability.

3. When the skill is mastered, the way becomes clear.

Many people overcomplicate trading, attributing their losses to a poor mindset, bad luck, or not finding the holy grail of trading.

There is also confusion about why trading always needs to be elevated to the level of "the way." Is it just pretentious mystification, or is it truly necessary?

In fact, most of the psychological issues in trading stem from immature techniques.Let me give an example: if your trading system is inherently simple and the trading criteria are clear, how could you hesitate and have a muddled thought process during actual trading?

If you have already conducted extensive backtesting and simulated trading with your system, how could you lack confidence and execution power in your trading system?

Backtesting is an extremely tedious but highly effective task that can test the profitability of your trading system. If you have gone through a lot of backtesting, how could you not know how difficult it is to execute complex technical standards? Only a simple trading system is the way out.

Because I have experienced all of these, so-called psychological issues are mostly due to one's laziness in technical aspects.

Later, my trading system only dealt with simple rectangular consolidation patterns. When trading, there was only one choice: if the current market met the criteria, I would trade; if it did not, I would just watch. If the rectangular consolidation breaks and creates space, I make a profit; if it doesn't, I cut my losses. It's that simple.

Under this trading model, my mind is very calm, and the psychological pressure is also very small because I finally understand that some profits belong to me, and some do not. I just need to focus on making the money I should make.

My trading thoughts have also become exceptionally clear and simple.

The financial market is very complex, filled with various temptations. Wanting too much can lead to psychological issues. Only by purifying and simplifying your thoughts can you truly make money.

Of course, making money is the hardest thing in the world, and with human nature flying all over the place in trading, making money becomes even more difficult.

However, if you have a simple, easy-to-execute, and proven-effective trading system, it can greatly restrain your human nature, simplify many things, and form a natural barrier to help you resist external temptations.Sometimes when thoughts are simplified and greed is let go, one can "see the true face of Lushan."