This is the real mindset chapter.

The universe is not benevolent; it treats all things as straw dogs. The sage is not benevolent; he treats the people as straw dogs. [Taoist Stock Forum]

The interpretations from books and apps are not what this article intends to convey.

Even a child knows this saying. But do you truly understand its application?

Let me guide you through the interpretation: (This article uses the quote as a lead-in)

Blunt its sharp edges, untangle its knots, soften its light, and merge with its dust—this is called the Mysterious Unity. Therefore, you cannot be close or distant; you cannot be benefited or harmed; you cannot be honored or debased. Thus, you become the most precious in the world.

Explanation: The Dao means that what is sharp will be smoothed, and what is tangled will be unraveled (reducing excess to compensate for deficiency). The Dao is in light, in the tiniest dust. The Dao is everywhere (subtle, rare, formless—these are the essence of the Dao). No matter who you are, in the end, your rough edges will be worn down, and you will follow the Dao.

When you reach the state of "Mysterious Unity" (being one with the Great Dao), there is no distinction between noble and base in your mind. No one is born noble, and no one is born lowly. The worldly hierarchy and status differences simply do not exist before the Dao.

When we see through the essence of the Dao, we are originally the same. There will be no mental disturbance. In the stock market, we are just molecules acting together. Mindset has nothing to do with the Dao. It has nothing to do with the stock market.

Saying that the most important thing in the stock market is mindset is ridiculous. How your mindset is has nothing to do with the stock market. You think that if a stock drops too much, it should rise. That is a fallacy. So holding onto it is also a fallacy. It’s not that a good mindset will bring it back; a bad one will continue to lose money. Can you understand? Once you understand what the Dao is, you will never mention the word "mindset."

Fear is an emotion everyone has. Even the most calm person can be afraid at times. There is only one way to deal with fear: to understand.

When we were children, there were many things we feared. First, encountering strict parents, we feared them the most. But as we grew up, we could understand our parents and even become friends with them. When we grow old, toward our aging parents, what remains is mostly filial piety, or sighs of regret at the relentless passage of time. The same thing, as our understanding deepens, our mindset gradually changes. This is the tolerance and calmness that come from raising the level of cognition.

Benevolence: Benevolence is actually a reasonable explanation. This tells you that the Way of Heaven is like the palm of the Tathagata; when it comes down, we can only figure out its meaning. No matter what your mindset is, it will not show the slightest compassion.

Straw dog: They are just grass dogs used in sacrifices. They are usually discarded after use. These two words are the central idea of this article. ① Silent and soundless: No matter how much attention the straw dog receives during the sacrifice, when the sacrifice ends, the result is the same—thrown aside, with no one feeling the slightest regret. In the stock market, we often find many friends obsessing over the last shining star stock, constantly going back and forth in it. When you understand this article, you will no longer do that. The key to differentiation is—whether it is within the cycle. The main army type can be the focus for a long time. But the consecutive limit-up stocks are used once and then discarded; their role is only to release that wave of energy. What energy? Aggressive energy. When lazy energy arises, it’s time to say goodbye. For example, BOE A has been a focus recently with the PCB hot topic, so it has stayed in sight. Do you think your stock will suddenly become the next hot spot? No, if it does, it would be due to other reasons. Because the sacrifice is over, the straw dog lies quietly in the pile of odds and ends, making no more sound.

② Time window: The hot spot is the sacrificial time; use it and discard it. Especially the speed of discarding "odd stocks." They are originally for testing. You test, the market doesn’t recognize—don’t you discard it? Unless the odd stock itself is the main force. Friday was very obvious. On Thursday, many sectors were moving, each appearing strong. But once Friday opened, it was announced that the market was focusing on robotics, and other sectors had to be discarded in time. If you think, "What if holding it a bit longer brings news support?" Then I’ll say one logic: If news is the dominant factor, wouldn’t it be too easy for the hidden capital? They know where the sentiment is, they lurk in, and then they release news. News can be faked or released at the right time. These days, the market is chasing earnings—does earnings suddenly pop up out of nowhere?

So the news we see is actually lagging. The market has already expressed something. Using news for such operations is within our capability. If we can read the market, we can benefit from the lagging news. Therefore, short-term stock trading is about changing with the moment. You only follow the direction of strength. Once the hottest is over, switch to the next batch. Stocks themselves, before the Dao, are just straw dogs.

③ Why use a straw dog? Couldn’t they use a real dog? So here comes a new insight: No waste; suitable for discarding after use. Wouldn’t a real dog be taken home to cook? Why didn’t Laozi write "all things are dogs"? Why a straw dog? Isn’t this telling you not to be obsessed with the value of undiscovered fundamental, news, or technical stuff? So, are you the kind of person who gets stuck by fundamentals, technicals, or news? If the market doesn’t recognize it, can you walk away? Have you achieved that? Here’s another insight: Fundamentals, technicals, and news are just superficial things. Is it inevitable for the market to make your stock move, or are there other choices? What is inevitable? When the market pulls your stock, that is inevitable. Do you understand how to choose stocks now?

The sage is not benevolent; he treats the people as straw dogs. This sentence talks about human nature, i.e., the change of people’s mindset, and it is also the interpretation of the title. ① A sage is a public figure who has understood the Dao. The sage takes the heart of the people as his heart. The people are what I often call: public sentiment. When everyone forms a consensus, the demand of the majority is the heart of the people. Is the demand of a group of people less powerful than what you call the main players? Remember how in many villages when land is requisitioned, if everyone doesn’t sign, you dare to move, and the whole village comes out with farm tools to fight you. Haven’t you seen that many times? So: Don’t fixate on a stock that stands alone; it is not the heart of the people. Especially those stocks that start with a one-character board. They cannot get the support of sentiment, so they are not on the backup list. Only after divergence and re-convergence does it have emotional value. Volume is the expression of sentiment.

What can a master think of here? I specially wrote an article, "The Silence Is Rare and the Precursor Light." Although these stocks don’t bring sentiment on the day of the limit-up, you need to look at how they exceed expectations. If the market follows, they may become the front runners. This is the stock that masters pay special attention to. Do you have such a backup? This "great silence" has a characteristic of "broad selection," with high uncertainty. The buying and selling point lies in exceeding expectations.

Is that contradictory above? No, it’s just a choice between two types of people with different risk tolerance. But the great silence must keep exceeding expectations.

② If the people are said to be concerted force, why does Laozi also describe them as straw dogs? This is the hardest part to understand in this article. Don’t we, the public, follow emotions to chase rises and dump falls? When do we become straw dogs? The key point here is the closing block order at the limit. I won’t elaborate too much here because reading the order block has many details. Yes, when the concerted force reaches an extreme (limit up/down), it will be sealed to express consensus. If follower stocks don’t hit the limit, we are straw dogs. I said it is difficult to trade in the main army market because it is hard to judge strength without limit-ups or limit-downs. So often, the front runners (small caps) give a confirmation signal. A sector may appear to have good sector effect, with many stocks pulling up, but none hitting the limit-up. At that moment, are we straw dogs?

To avoid becoming straw dogs, we must review from the limit-up/down moves. If a sector has no limit-up, what are you looking at? Do you want to be a straw dog?

During the trading session, when we see a rotating market, emotions come in waves like ripples. Do you chase everything? Are you a straw dog? Must we see the quality and quantity of limit-ups? Can you catch the core on the first day? That’s wishful thinking unless the sector is in an emotional cycle and already has a linked sentiment from earlier.

So on the first day, we watch the show. Robotics was the first day on Friday. Everton was also the first day for robotics. The two previous limit-ups have nothing to do with this wave of sentiment. You are overthinking. They are just the first board. Their position determines what tier they will be on Monday. On the second day, judge strength. No matter how strong the first day appears, it’s just for watching. On the second day, the sector categorizes (front and back rows), so you can see strength more clearly. On the first day, if you were unlucky and picked the back row that others chose, will you switch on the second day?

Summary: After reading the whole article, did you see mindset? Yes, mindset was mentioned. Mindset arises from these details. Mindset is inevitable in the operation of the Dao. Any thought you have will have decisive significance. So, Laozi had this way of thinking 2,000 years ago. Are we less wise than the ancients? Mindset makes your choices different because "you do not know the constant." Just know the constant, and it’s fine.