Investors often complain: "Why do I always lose money when investing like everyone else? Am I really not suited for the stock market?" In fact, failure isn't scary - what's scary is giving up after failure. Stock investing isn't difficult; the hard part is finding the right method. If following conventional analysis always leads to failure, why not try Contrary Theory?
The core idea of Contrary Theory is to analyze investor and market judgments in practical operations, and adopt opinions different from the majority under extreme circumstances. People in all regions prefer going long, believing bull markets are the only way to profit. What they don't realize is that when everyone is bullish, the market has already peaked - it's time to sell because bullish momentum is nearly exhausted. Like a rollercoaster reaching its peak, the subsequent decline will accelerate rapidly. Conversely, when everyone is pessimistic and panicked, it indicates the trend has bottomed, bearish forces are ending, and stock prices are about to reverse upward. We must always be ready to enter the market. Market conditions constantly change; we can't control them but must adapt. Contrary Theory isn't absolute opposition - it still follows trends and fundamentals, just with opposite views on market direction.
No market maker is foolish. They all observe from retail investors' perspectives and hire professionals to study retail psychology. Market makers naturally possess unique techniques, making retail analysis tools trivial to them. When market makers know both themselves and their opponents, how should we approach this seemingly unwinnable battle? The best method is reverse-thinking - by opposing all retail investors' psychological expectations, we can advance and retreat with market makers when they control the game.
Of course, if you merely approach it theoretically with different ideas than other investors, your understanding of Contrary Theory remains shallow. In practice, Contrary Theory emphasizes data collection, analyzing market maker psychology from fundamentals, and following K-line trends. Relying solely on intuition and subjective judgment will leave you lost during bull-bear transitions.
Contrary Theory relates to the market, not just group psychology. It typically works best under extreme market conditions. Investors shouldn't let emotions or environmental influences control their awareness. Applying Contrary Theory depends on one's cognitive abilities, independent thinking, and personal decision-making.
