We often hear people in the market say: the bullish "sentiment" is high, the bearish "sentiment" is high..... At the same time, the market price performance will also show corresponding feedback.

Therefore, we believe that assessing market sentiment will have a strong predictive effect on market development.

So what exactly is emotion?

"Emotion" refers to a person's subjective psychological experience of objective things.

In other words, the judgment of trading based on market "sentiment" is a subjective observation, and the data sampling of sentiment is inevitably subjective, as sentiment itself is based on a subjective foundation.

The foundation of technical analysis is to observe the patterns of price behavior changes, thereby analyzing expected trends and formulating trading strategies.

"Emotions" are invisible and intangible, but the price actions they generate will objectively reflect in the changes of the candlestick values.

In other words: "The market will prioritize reflecting everything in the trading situation."

Technical analysis aims to make subjective judgments about the future by utilizing objective data and all objective market information.

The 'emotional' trading seeks to make subjective judgments about the future based on subjective observations.

Therefore, from the perspective of probability theory, logic that often has an excessive subjective component is difficult to derive higher conclusion guidance based on objective facts.

After talking for a long time, what I want to say is very simple. For the vast majority of people, the most basic knowledge for trading is still technical analysis. The lowest barrier to entry is also technical analysis. With global data synchronization, there is no discrepancy in market data information, and all historical trends can be backtested and verified.

Any methodology can achieve a closed-loop trading system, provided that: who is using it? Whether it is: emotions, macro, on-chain, technical, metaphysics, astrology......

In the end, trading is the embodiment of empiricism, and empiricism inevitably leads to path dependence. The two complement each other; however, the establishment of path dependence requires a stepping stone, and standardized processes serve as that stepping stone.

In other words, mastering the essentials of technical analysis requires learning theoretical teaching content in order to embark on the trading path.

The results of trading only exist in the differences among people, not in the differences of theoretical methods. Some people can get rich relying on intuition, but you can't; some can get rich relying on emotions, but you can't; some can get rich relying on EMA, but you can't; some can get rich relying on MACD, but you can't...

Learn trading; if you can learn simply, don't learn complicatedly. Everything should start simply and then go to complexity, and then return to simplicity.

From simple to complex is easy. From complex to simple is difficult. This is the life of a trader, as subtraction is the hardest part, returning to the state of seeing the mountain as just a mountain requires going through the arduous process.

I've said too much. I'm not trying to be long-winded, because if I really wanted to be long-winded, I could go on forever. This kind of content will only be discussed more in the community in the future.

END.