Buy and sell points
Powerful principles easily discovered!

The author, a seasoned expert who has traded the stock market for 40 years, has learned through extensive experience that adapting to the market is more important than predicting it.
The '4-Equivalent Rule Trading Method' is the method that established that realization as a practical trading technique.
This trading method is a simple yet powerful principle that divides the stock price into four parts based on the high and low points to find buy and sell points.
Instead of having to struggle to match the high and low points like a ghost, you can use the principle of 'mean and center' to establish a stable standard in practice.
The biggest advantage of this trading technique is that it does not require complex indicators or economic knowledge.
Anyone can interpret the market and use it for trading right away with simple calculations that can be done with elementary school math.
It can be executed without knowing complex auxiliary indicators, and anyone can easily follow it.
For beginners, the Rule of Four can help them develop a solid trading routine, while for experienced investors, it can help them fine-tune their existing analysis system.
Although it is a trading standard derived from simple arithmetic, it is a principle that has been proven through countless trials and errors over 40 years of market experience.
Ultimately, this technique can be called a 'philosophy of real trading' that allows investors to breathe with the market without being swayed.

The key point the author emphasizes in this book is the 'philosophy of roughness.'
The word roughly does not mean irresponsible or vague.
Rather, it refers to the wisdom of acknowledging the uncertainty of the stock market and dividing the high and low points of stock prices into four parts and setting an average baseline.
You can easily distinguish between sell zones in an uptrend and buy zones in a downtrend through the 75% ridge price, 50% center price, and 25% ridge price.
These rough guidelines provide a safety net that can always respond to any market trend.
Therefore, investors have the freedom to adapt rather than worry about trying to guess the stock price.
The author emphasizes that in a reality where even corporate financial statements are not free from manipulation and falsification, the only thing that can be trusted is the flow of stock prices themselves.
The average, center, and repetitive waves created by stock prices are the compressed results of investor psychology.
Lee Seung-jo's rule of four equal parts is a method of finding objective standards in this flow.
Through this book, you will finally be able to become an investor who follows the principles of structure, rather than a slave to emotions.

The most important thing in practice is to find something that suits your investment style based on simple principles and methods.
Having battled the stock market for over 40 years, the only method I can recommend is the 'Rule of Four'.

The basic philosophy of the rule of four equal parts is based on the natural cycle of 'spring, summer, fall, and winter' and the principles of 'center' and 'balance' mentioned in the Book of Changes.

After simplifying the flow of highs and lows of waves that actually unfold in the stock market, we combined it with the seasonal cycle theory.
The high points are considered the extremes of summer and the low points are considered the extremes of winter, and the different cycles for each stock are simplified into the location and changes of the central price and applied to actual trading.

---From "Chapter 1: The Rule of Four: A Powerful Practical Trading Tool"

For beginner investors, it is recommended to start training with a 20-day or 60-day time period.
My personal favorite cycle is 60 days.
20 days is too short and tends to only increase the turnover rate, while 120 days is burdensome as it can cause the 'pain of time' and comparative psychology that is difficult for novice investors to handle.

Of course, the criteria may vary depending on the characteristics of the stock and the size of its market capitalization.
Mid-cap and small-cap stocks are more volatile than large-cap stocks, so a 20-day period may be more appropriate.
However, it is important to first train on a 60-day basis and develop a sense of finding the appropriate cycle for each sport.

The important point here is to establish a sense of criteria for judging the 'next wave' when a correction occurs after a rising amplitude.

---From "Chapter 1: The Rule of Four: A Powerful Practical Trading Tool"

A 'golden cross' refers to a phenomenon in which a short-term moving average (e.g., 5-day moving average, 20-day moving average) crosses a long-term moving average (e.g., 60-day moving average, 200-day moving average) from below to above.
This is generally interpreted as a bullish reversal signal, indicating a positive turn in market sentiment.

Conversely, a 'dead cross' refers to a phenomenon in which a short-term moving average breaks downwards from above to below a long-term moving average.
This is generally interpreted as a signal of a bearish reversal and is taken as a sell signal or a warning of further decline.

For short-term investment, it is important to set buy and sell timings by closely tracking the intervals between the 5-day and 20-day moving averages and the price ranges where golden crosses or dead crosses occur.

---From "Chapter 1: The Rule of Four: A Powerful Practical Trading Tool"

If the stock price rises sharply and the gap from the moving average becomes excessive, there is a high possibility of profit-taking.
At this time, it is recommended to set the deviation rate limit based on the 5-day, 10-day, 20-day, 60-day, and 120-day moving average lines, and if this standard line is exceeded, it is recommended to realize some profits or consider the timing of selling.

Also, when the short-term moving average breaks below the long-term moving average, the trend itself often breaks down.
For example, if the 20-day moving average breaks below the 120-day moving average, this is interpreted as a signal of the end of a long-term uptrend.
But before that, in the section where the 5-day moving average breaks below the 10-day moving average, it is advisable for short-term investors to establish a preemptive selling strategy.

---From "Chapter 1: The Rule of Four: A Powerful Practical Trading Tool"

In the basic structure of the descending triangle pattern, it is important to first determine whether the 50% central price level becomes a 'support line' or a 'resistance line'.


The stock price fluctuates in a zigzag pattern between the '25% ridge price, 50% center price, and 75% ridge price', but ultimately, whether there is resistance at the 50% center price becomes an important turning point.
If the 50% central price acts as a strong resistance line, repeatedly threatening the vicinity of the previous low or eventually collapsing the lower point, this is a typical form of a '50% central price resistance pattern.'

---From "Chapter 1: The Rule of Four: A Powerful Practical Trading Tool"

The monotonic law is a criterion that complements the limitations of the quadratic law.
The four-part rule introduced earlier is useful for setting repurchase points based on waves abc during the adjustment period after the completion of the first rising wave.
However, the rule of four divisions has limitations in that it is difficult to apply it directly to mid- to long-term investors, unless they are short-term traders using 30- to 60-minute charts, especially in the early stages of an upward trend.
Therefore, in order to include the initial rising section in the analysis, it is much more useful in actual trading to use the monowave law, the four-part law, and the P-MAX/P-MIN wave technique together.

So, what exactly is a monowave? Also known as a "fundamental wave," it analyzes the strength of energy generated during each stock's first rising wave. When that energy successfully reaches a certain level, the monowave is considered complete.
The most important thing at this time is ‘setting standards.’

---From "Chapter 2 Monowave Law: Supplementing the Limitations of the Four-Part Rule"

You need to measure the energy of which stocks are rising and which are falling, and calculate the proportion of rising stocks and falling stocks to determine long and short energy.
Based on this, it is important to also track changes in the target stocks for program buys and sells.

Foreigners and institutions sometimes engage in naked buying and selling of Samsung Electronics and SK Hynix, but most engage in "synthetic trading" by combining futures sales with Samsung Electronics purchases, or by combining futures purchases with Samsung Electronics sales.
These trading trends must be tracked.

---From "Chapter 2 Monowave Law: Supplementing the Limitations of the Four-Part Rule"

While the 'rule of fourths' is useful for predicting the next wave after a wave has completed, the monowave criterion is effective in determining whether an uptrend from a low is a trend reversal or a simple rebound followed by a lower low.

Basically, the top 10 stocks by market capitalization should show an upward first wave energy of 21-25%, and this range should act as support rather than resistance to be interpreted as a trend reversal signal.
For other blue-chip stocks, the energy of the first rising wave must be at the level of 25-38.2% to be evaluated as a wave with the possibility of a full-scale trend reversal.

---From "Chapter 2 Monowave Law: Supplementing the Limitations of the Four-Part Rule"

In the HBM (high bandwidth memory) theme that links Nvidia and SK Hynix, Hanmi Semiconductor, IOtechnics, HPSP, and Hanwha Vision are emerging as key related stocks.
Therefore, it is essential to compare and analyze the relative speeds of these items from a monowave perspective.

This analysis is crucial for establishing a cyclical strategy within the small and medium-sized enterprises (materials, parts, and equipment) sector. In particular, when applied in conjunction with the four-part rule, it allows for a clear distinction between stocks to focus on and stocks to watch in current practice.

---From "Chapter 2 Monowave Law: Supplementing the Limitations of the Four-Part Rule"

In the case of stocks that have surged, the market often sees a series of strong upward investment opinion reports, predicting further upward rallies. However, the stock price often does not rise as strongly as expected, instead only increasing volatility.

However, Hanwha Ocean also formed a low of 71,500 won on July 7th while supporting the 120-day moving average, and then turned into an upward trend.
Afterwards, foreign buying began to flow in, and on July 31, with the material for the ‘150 billion dollar Chosun stock fund’ being raised, the price soared to 120,000 won on August 1.
As shipbuilding emerged as a new leading stock in the Korea-US tariff agreement, the diamond pattern that had been unfolding since March 24, 2025, shifted into an upward trend.

---From "Chapter 2 Monowave Law: Supplementing the Limitations of the Four-Part Rule"

Personally, when selecting a company to buy or sell and assessing its rise and fall, I always check the 'salary chart' first.
In the case of Samsung Electronics, a major change occurred in May 2015 when Chairman Lee Kun-hee collapsed from a myocardial infarction.
In the same year, Samsung SDS and Cheil Industries (Samsung Everland) were listed, and then, on January 31, 2018, at the extraordinary general meeting of shareholders, it was decided to split the stocks with a par value of 5,000 won into 100 won.
In other words, it was an unprecedented 50:1 stock split, with one week divided into 50 shares.

---From "Chapter 3 Analysis of Representative Companies Using the Rule of Four"

A stock split is a method of increasing the number of shares by lowering the par value of existing shares without increasing the capital.
For example, if a stock with a par value of 5,000 won is split into 500 won shares, the number of shares increases tenfold.
The opposite concept of a par value split is a ‘par value consolidation.’
There are surprisingly many companies in our country that have implemented stock splits.
A stock split is chosen when the stock price is too high and trading is not active because it increases the number of outstanding shares without actually increasing the capital.
As a representative example, in 2000, when SK Telecom's stock price approached 5 million won, it lowered the stock price by 1/10 through a stock split and increased the number of outstanding shares to stimulate trading.

---From "Chapter 3 Analysis of Representative Companies Using the Rule of Four"

I recommend running two accounts in parallel.
The first account is a 'Trading Training Account' where you learn trading philosophy and strategies through practical trading based on technical analysis.
The second account is a "time travel value investment account" with a minimum investment period of 3-4 years. It is used to select value investment stocks and build up internal skills through repeated corporate analysis.
If you run these two accounts in parallel, you may experience confusion (mental breakdown) as if your brain is split in two.
However, if you want to grow into a true stock entrepreneur, this process is also a training that you must go through.
Ultimately, what's important in investing is the ability to combine technology and fundamentals.
By following the flow of 'past figures → current figures → future predicted figures', we can track how this stock price will move in the future.
Although it may seem difficult at first glance, the approach is surprisingly simple.

---From "Chapter 3 Analysis of Representative Companies Using the Rule of Four"

As I measure the monowave energy, I personally measure how the potential energy changes based on a 20-day time period.
Investors with a day trading mindset can use 5-10 day periods as a benchmark.

The basis here is to compare the positions of the 5-day, 10-day and 20-day moving averages with the monowave energy over that period.
For investors who can maintain a long investment horizon, we recommend a 120-240 day investment horizon.

---From "Chapter 3 Analysis of Representative Companies Using the Rule of Four"

Secondary batteries have been on an upward trend for about three months since late May, attracting investors hoping for a return to past glory. However, considering the decline in former leading stocks EcoPro and EcoPro BM from their peaks, a return to those days is still a long way off.
Compared to the previous decline, the current upward energy is still weak.
Therefore, if you are an investor who has been hit hard by secondary batteries, you should learn how to overcome losses by utilizing the four-part rule and P-MAX/P-MIN waves learned here.

---From "Chapter 3 Analysis of Representative Companies Using the Rule of Four"