Charmander Classroom is now in session: A new approach to transitioning from "amateur" to "professional" in trading!

Good afternoon, brothers. Recently, many fans and new students have asked me: “How does Long Shen Long Shen do T to make money?” “How to do T without getting trapped?” So today, let’s talk about doing T! [Taogu Ba]

Last year, I posted an article summarizing five core methods of doing T. Today, I want to share some ideas on doing T. Without further ado, let’s get straight to the main topic.

1. Emotional Anxiety Bound by Cost

Most friends who do T have a “curse” in their minds — that is, yesterday’s cost basis. When stocks fall, they panic and rush to buy more to lower the cost; when they rise a bit, they fear a pullback and quickly sell their core holdings. The result is often “T flies away” or “the more they buy, the more trapped.”

This mindset of “saving costs or locking in small profits in an emergency” is essentially passive and emotional; it’s doing T just for the sake of doing T.

Instead, let’s adopt a new mindset: treat doing T as an independent battle of resistance, and view each buy-in as your first time liking this stock, using new funds. Turn doing T into a new, proactive, disciplined investment behavior.

At this point, your focus shifts: no longer looking at “whether I lost or gained,” but instead focusing on different questions from passive position unwinding.

2. Congratulations, your thinking has upgraded!

The previous mindset was based on “stock quantity”: focusing on yesterday’s cost basis, which is psychologically burdensome. To preserve the gains of the core position, it’s easy to “T fly away” at the start of volatility; or to lower costs, blindly buy more during a decline, resulting in increasing traps.

Now, the starting point is “increment” and “current”: ignore past costs and look at whether the current price is worth buying. Since it’s a “new buy,” you’ll naturally evaluate it like a new stock: Is the position good? Is the volume sufficient? Is the risk-reward ratio appropriate?

Your decision becomes rational rather than impulsive.

3. Three elements of new thinking

Since it’s a new decision, it can’t rely on feelings; it must return to the essence of trading:

1. Entry point

Previously: “The correction has been so much, should it rebound?” (blind bottom-fishing)

Now: “Does it meet my technical buy point?” (e.g., intraday support, moving average bullishness, indicator golden cross)

Must have a clear technical buy point. For example, if the intraday chart shows a “second bottom” that doesn’t break the new low, or if the stock price breaks through the intraday moving average with volume and stabilizes. Without these signals, even if the price is lower, this “new investment” should not be made.

2. Entry position

Previously: Buy whenever it’s cheap, regardless of trend up or down.

Now: Is it in a safe zone? (e.g., upward trend correction, bottom of a box range, not chasing high)

Assess the overall environment. Is this “new buy” during a trend correction? Is it at the support at the bottom of a box? If it’s in a downtrend and you’re “catching a falling knife,” that’s not rational investing.

3. Volume change

Previously: Ignored trading volume, only looked at price fluctuations.

Now: Is there supporting capital? (Has volume decreased and stabilized? Has volume increased but prices stagnated? Is there a volume-less rise?)

4. Add a “filter”: Before clicking the button, ask yourself three questions that hit the heart:

1. If I didn’t have this stock now, would I buy it?

2. Is the reason for buying it “cheap” or “has potential to rise”?

3. Where is the stop-loss for this buy?

Turn doing T from a “firefighter” into an “actuary,” treating each operation as an independent, rational investment decision. This is the right mindset to reduce position costs and achieve steady growth.

Volume is the foundation of price. When buying, it’s best to see “volume shrinkage and stabilization” (indicating less selling pressure and easier to push up) or “volume increase and rise” (indicating funds are entering). If it’s “volume shrinkage rebound” or “no-volume rise,” it shows insufficient upward momentum, and this “new buy” should be cautious.