---

All the problems in forex short-term trading,
Have answers here!
All the troubles in forex long-term investment,
Have echoes here!
All the psychological doubts in forex investment,
Have empathy here!

---

In the two-way trading market for foreign exchange, short-term traders—even when utilizing the Volume-Weighted Average Price (VWAP) algorithm to process fragmented, small-value orders—still encounter numerous structural challenges in actual practice.

---

The so-called Volume-Weighted Average Price is, in essence, an average price derived by weighting all trades executed within a specific time frame according to their respective volumes. Its core function lies in aggregating and bundling large quantities of "odd lots" and small orders—specifically those characterized by minuscule individual transaction volumes, irregular quantities, and high-frequency entry and exit—rather than transmitting them piecemeal to liquidity providers. This aggregation serves to satisfy the minimum transaction volume thresholds typically imposed by upstream channels, thereby mitigating the frictional costs associated with rejected small orders, execution at premium prices, or the imposition of additional fees. Simultaneously, it dampens the repetitive market price shocks caused by frequent order placement, fostering greater stability in execution prices, narrowing slippage, and ultimately rendering overall trading costs stable and controllable. However, the effective operation of this mechanism is highly contingent upon the alignment of the position-holding duration. For short-term traders, whose holding periods are brief and whose capital remains in the market for insufficient time, orders often require settlement before they have undergone adequate time-based maturation and price-averaging processes. Consequently, the VWAP algorithm struggles to leverage its inherent advantages of batch-based smoothing and hedging; instead, premature position closure may inadvertently amplify actual execution costs, thereby reducing a technical arrangement originally designed to reduce expenses to a mere formality.
In contrast, the orders of long-term investors naturally possess the requisite conditions to be appropriately bundled and transmitted to liquidity providers. Given their longer holding periods and lower trading frequencies, brokers are afforded a sufficient time window to consolidate multiple fragmented, small orders. By calculating a unified average price via the VWAP method, these orders can be synthesized into a single, large-block order that meets the minimum volume requirements of liquidity providers, allowing for a one-time, comprehensive hedge. This approach not only circumvents the predicament of rejected odd lots or premium-priced executions but also prevents the persistent market shocks and exacerbated slippage that result from frequent, small-scale order placement. Under this model, trading costs remain controllable and execution quality remains stable—an arrangement that proves mutually beneficial for both the investor and the broker. In practice, Japanese forex brokers generally prioritize internal hedging mechanisms. This entails first attempting to match client orders within an internal matching pool; only when long and short positions cannot be fully offset internally is the remaining net exposure routed to the external market. This method of internal hedging proves particularly efficient for small, fragmented orders: given their minute volume and diverse directional biases, these "odd lots" are easily matched naturally within the brokerage firm, obviating the need to route every single transaction to upstream liquidity providers. Consequently, this approach bypasses the minimum transaction volume thresholds and avoids the additional costs associated with frequent market impact. It is crucial to clarify that this internal hedging of small orders does not constitute "betting against the client" (dealing desk speculation); rather, it is a risk management technique grounded in actual client order flow. Its objective is to enhance order execution efficiency and reduce operational complexity—not for the broker to actively take directional counter-positions against its clients. By prioritizing the internal absorption of small orders, brokers can significantly reduce their reliance on external markets and mitigate overall operational uncertainty, while simultaneously providing clients with a more stable trading environment characterized by more predictable costs.
Synthesizing the mechanisms described above, it becomes evident that forex traders, when selecting a strategic time horizon, must give full consideration to the structural costs inherent in the order execution layer. While short-term trading may appear flexible, its characteristics—high frequency, small transaction sizes, and rapid entry/exit—stand in fundamental conflict with the entry thresholds imposed by liquidity providers and the costs associated with market impact; indeed, even the use of Volume-Weighted Average Price (VWAP) algorithms struggles to fully resolve this inherent tension. Conversely, long-term investing not only aligns seamlessly with the technical logic of internal hedging and batch processing, but also serves to smooth out price volatility over time and reduce aggregate trading costs, thereby fostering a mutually beneficial outcome for both the investor and the broker. Therefore, when evaluated across multiple dimensions—including order execution efficiency, cost control, and the overall health of the market ecosystem—forex traders should endeavor to focus on long-term strategic positioning rather than engaging in frequent short-term maneuvers. This approach demonstrates a responsible stewardship of one's own capital efficiency while simultaneously respecting the operational logic of one's trading counterparties, ultimately paving the way for a more sustainable model of investment and trading.

In the arena of two-way forex trading—a landscape rife with uncertainty—the ultimate determinant of a trader's success or failure is often not a contest of pure intellect.

---

This is not a stage for flaunting one's IQ; traditional intellectual advantages—such as academic credentials, the prestige of elite institutions, or lightning-fast reflexes—appear utterly pale and powerless in the face of market volatility. The true core lies in the deep cultivation of a trader's inner character: the degree of personal maturity, the resilience to withstand setbacks, and the mastery over greed and fear. These psychological attributes are far more critical than mere cognitive intelligence. The market never grants special favors simply because a trader is clever; on the contrary, it ruthlessly magnifies every flaw in one's character.
Countless examples demonstrate that the market is rife with high-IQ, highly educated traders who have suffered catastrophic losses; even elite professionals holding master's or doctoral degrees are just as susceptible to devastating failure. This starkly validates a brutal truth: IQ serves merely as the "entry ticket" to the market. It may enable you to comprehend complex indicators and construct sophisticated models, but it offers no guarantee that you will remain composed when facing losses, or exercise restraint when reaping profits. What truly determines whether an individual can survive and thrive in the forex market over the long term is the resilience and stability of their character. With the right character—even if one possesses only average natural talent—disciplined execution can lead to consistent profitability; conversely, with a flawed character, even the most brilliant strategies will merely become instruments that accelerate losses, causing smart people to fail faster and more miserably.
Those traders who ultimately achieve success often embody a unique, paradoxical unity: they may not have been academic prodigies in the traditional sense, yet they are undoubtedly sages capable of instantly discerning the fundamental laws governing the market. They may not be endowed with extraordinary natural gifts, but they have invariably undergone the market's relentless crucible, emerging with a wealth of solid, practical experience. This form of "wisdom" does not stem from an accumulation of book knowledge, but rather from a profound insight into the frailties of human nature, a deep reverence for market dynamics, and a sense of composure and patience forged through countless setbacks. They possess the ability to remain clear-headed amidst volatility and to steadfastly uphold their principles in the face of adversity; this inner strength—radiating from within—is the ultimate safeguard for navigating the market's cyclical tides.
Forex trading is never a contest of fleeting cleverness; it is, and always has been, a testament to the character refined over years of patient cultivation. The tempering of character, the capacity to endure setbacks, and the mastery of investment psychology—these seemingly intangible "soft skills" are, in reality, a trader's most impenetrable armor. They must be repeatedly forged within the crucible of the market—gradually built through reflection upon every loss, restraint amidst every gain, and the calming of every turbulent emotion. When a trader learns to confront their inner demons, to exercise restraint in the face of temptation, and to steadfastly uphold their convictions amidst despair, a profound sublimation of character quietly takes place. This transformation ultimately translates into the core stability of one's trading system, enabling the trader to maintain their footing and navigate a steady, sustainable path forward amidst the ever-shifting tides of the market.

The foreign exchange (Forex) market—a two-way trading arena—is a unique domain characterized by high liquidity, high leverage, and high volatility. Its distinctive trading mechanisms allow investors the opportunity to generate profits whether exchange rates are rising or falling. Consequently, it has come to be viewed by many investors as a promising avenue for achieving substantial asset appreciation and reshaping their financial landscape—a vehicle carrying the hopes of those aspiring to transcend their current socioeconomic strata.

---

Yet, concurrently, the complexity of the Forex market far exceeds that of conventional investment sectors. Exchange rate fluctuations are driven by a confluence of external factors—including global macroeconomic data, geopolitical developments, central bank monetary policies, and international trade frictions—rendering the market subject to instantaneous shifts that are exceedingly difficult to predict with precision. As a result, it has become a "wealth slaughterhouse" for the vast majority of investors who lack the requisite professional insight and risk management capabilities.
In reality, countless investors—without fully grasping the fundamental dynamics of the Forex market or acquiring basic financial market literacy—are lured by the promise of short-term profits and blindly plunge into trading. They frequently overlook the inherently high-risk nature of the Forex market; lacking both the ability to identify potential trading risks and a scientific strategy for capital management, most ultimately face the grim reality of substantial financial losses—or even the total depletion of their capital. This serves as irrefutable proof that Forex investment is by no means a realm where one can profit solely through luck, nor is it—as is often falsely claimed—a "shortcut to instant wealth." For forex investors, capital market literacy serves as the fundamental bedrock for establishing a foothold in the market. This literacy is not merely a simple accumulation of knowledge; rather, it encompasses a comprehensive understanding of the capital market ecosystem, basic risk identification capabilities, scientific capital management techniques, and rigorous market analysis logic. Without first cultivating this core literacy, one is strongly advised against venturing lightly into the forex trading market. Even if one were to enter on a momentary impulse, they would struggle to navigate the market's complex dynamics—let alone withstand the inherent trading risks.
It is crucial to clarify that while the accumulation of trading techniques and experience is undoubtedly important, it cannot serve as a substitute for the pivotal role played by capital market literacy. No matter how many sophisticated trading techniques one masters, or how much superficial trading experience one accumulates, nothing can compensate for the critical deficiency of lacking capital market literacy. Forex investors who lack this core competence—even if they manage to secure fleeting profits in the short term thanks to fortuitous market conditions—are merely beneficiaries of luck. Ultimately, they are bound to succumb to losses amidst the market's ruthless winnowing process; they will find it impossible to achieve consistent, long-term trading profitability, and certainly cannot hope to attain true success within the forex market.

In the realm of forex investment—a field characterized by both high risk and high leverage—veteran traders and industry observers generally adopt a cautious, if not outright opposed, stance regarding novices venturing into short-term trading.

---

They argue that while the forex market's two-way mechanism offers participants the dual opportunity to profit from both long and short positions, the fast-paced and high-frequency nature of short-term trading often stands in stark contradiction to the capabilities and limitations of novice investors.
Of particular concern is the fact that industry veterans explicitly advise against young people—especially recent college graduates—entering the market via a "trade-while-working" model. In their view, forex investment—whether involving short-term maneuvers or broader asset allocation—is fundamentally a profound test of human nature. It demands extensive life experience to serve as a bedrock for risk awareness, and, even more importantly, requires long-term mental discipline to withstand the emotional shocks triggered by market volatility. For novices to rush into the forex market to engage in short-term trading without possessing sufficient social experience or psychological resilience is akin to leaping into a raging torrent before having mastered the art of swimming; the potential dangers extend far beyond mere financial losses, potentially leading to the development of a distorted trading mindset.
From the perspective of habit formation, the frequent entry and exit inherent in short-term trading can easily trap novice investors in a cycle of "overtrading," fostering detrimental habits such as chasing rallies, panic-selling during downturns, and engaging in reckless, heavily leveraged gambles. Successful traders—those who have weathered the ups and downs of the forex market to ultimately establish a firm foothold—deeply understand the arduous nature of generating consistent profits amidst the turbulent waves of exchange rate fluctuations. They know that behind every penny of profit lies a profound insight into market dynamics, coupled with a steadfast, long-term commitment to strict discipline. In contrast, novice investors—hampered by inadequate technical analysis skills, weak fundamental analysis capabilities, and a limited awareness of risk management—often suffer significant losses, or even completely deplete their principal, at the mercy of the market's random fluctuations.
Forex traders who adhere to the philosophies of long-term and value investing typically emphasize that true investment competence is built upon a systematic understanding of macroeconomic trends, monetary policy trajectories, international balance of payments conditions, and the intrinsic value of currencies. This capacity for judgment cannot be acquired overnight through the mere reading of a few specialized books or a brief stint of simulated trading; rather, it demands baptism by a complete bull-bear market cycle within a real-world trading environment, through which one gradually cultivates a forward-looking grasp of long-term exchange rate trends.
The reality is often brutal. A vast number of novice forex investors rush into the market without adequate preparation, ultimately paying a heavy tuition fee—one that entails not only a severe depletion of their account capital but also the loss of time and opportunity, alongside a devastating blow to their confidence in investing. Admittedly, a tiny minority within the forex market do manage—through years of rigorous self-cultivation—to evolve into seasoned experts adept at long-term strategic positioning; yet, this requires a rare confluence of natural talent, diligence, and sheer luck. For the majority of novices, the situation is akin to a gamer rashly entering a high-level dungeon before mastering the basic rules of the game; their skill set is woefully mismatched against the challenges they face. Consequently, they inevitably end up as mere "cannon fodder" in the market's zero-sum game, exiting the stage in defeat as they are crushed beneath the weight of institutional capital and professional traders.

In the two-way trading environment of the forex market, successful traders—those possessing extensive practical experience and a mature trading system—almost universally express strong opposition to novices engaging in short-term trading. This stance is not merely subjective conjecture; rather, it represents a professional consensus grounded in the inherent volatility of the forex market, the critical importance of trading discipline, and the specific limitations inherent to a novice's capabilities.

---

Successful forex traders also firmly advise against recent college graduates attempting to engage in forex trading while simultaneously holding down a regular job. They argue that, regardless of whether the trading horizon is short-term, medium-term, or long-term, successful trading demands not only a solid technical foundation but also the accumulated wisdom of life experience and a mature, disciplined mindset. Young people fresh out of academia often lack a healthy reverence for market risks, the capacity to manage their own emotions, and the judgment required to navigate complex market environments. To rush into the forex market at this stage—particularly to engage in short-term speculation—is unlikely to yield the anticipated returns; far more likely is that they will fall into trading pitfalls, thereby casting a negative shadow over their future investment journey. The disadvantages of short-term foreign exchange trading are particularly pronounced for beginners. In terms of habit formation, the high-frequency nature of short-term trading often leads novices to develop detrimental habits—such as seeking quick profits, trading excessively, and neglecting risk management. Once ingrained, these habits are extremely difficult to correct in subsequent trading activities and can compromise the soundness of their investment decisions over the long term. From the perspective of balancing risk and reward, the foreign exchange market is subject to a confluence of factors—including global macroeconomic conditions, geopolitics, and monetary policies—resulting in extreme volatility and inherent uncertainty. Even highly experienced and successful traders must engage in diligent analysis and arduous strategic maneuvering to generate reasonable returns. Conversely, beginners—lacking an understanding of market dynamics, the ability to interpret trading signals, and a robust risk management framework—are highly susceptible to misinterpreting market trends, blindly following the crowd, and executing improper stop-loss orders. Ultimately, this often leads to substantial financial losses, potentially resulting in the complete depletion of their initial capital.
Successful foreign exchange traders generally adhere to core philosophies centered on long-term and value-based investing. They view foreign exchange trading not as a short-term speculative gamble, but as a discipline grounded in a deep analysis of long-term market trends, the intrinsic value of currencies, and global economic cycles. This investment paradigm demands that traders possess a solid foundation of professional expertise—most critically, the capacity for precise judgment and deep insight regarding the corporate value, macroeconomic trajectories, and monetary policy orientations of the economies underlying various currencies. Only by cultivating such capabilities can traders effectively identify genuine investment opportunities, mitigate potential risks, and achieve the steady, long-term appreciation of their assets within the complex and ever-changing foreign exchange market.
The risks confronting beginners entering the foreign exchange market are too significant to ignore. Lacking the necessary professional knowledge, trading experience, and risk management skills, many novices are lured by the illusion of quick short-term profits and rush headlong into the market. Consequently, they often pay a heavy financial toll—stemming from misjudged market trends, flawed trading strategies, and inadequate emotional control. These setbacks not only result in the loss of their principal but may also erode their confidence in the investment markets and, in some cases, severely jeopardize their personal financial stability. At the same time, it is extremely difficult for novices to evolve into seasoned traders capable of long-term investing. While a select few in the market do indeed manage to grow gradually through sustained study and repeated practice, the vast majority of beginners—lacking sufficient patience, perseverance, and professional guidance—find their skills unable to keep pace with the demands of long-term investment. Much like a child in a video game who rashly attempts a high-difficulty level despite lacking the necessary skills, they ultimately end up as mere "cannon fodder" amidst market fluctuations, eventually being weeded out and eliminated by the market.

---

• 
• 

---

13711580480@139.com

+86 137 1158 0480

+86 137 1158 0480

+86 137 1158 0480

z.x.n@139.com

Mr. Z-X-N

China · Guangzhou

---