Open Trading Club
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Our objective is to provide all trade ideas about market analysis & commentary for active traders and investors. Posts about equities, options, forex, futures, analyst upgrades & downgrades, technical and fundamental analysis, and the stock market in general.
- OrganizerJuly 27, 2021 at 7:03 am
capture gains through the analysis of an asset’s momentum
- OrganizerJuly 27, 2021 at 12:17 pm
A master of trend trading, quantitative trading system ideas (very valuable)
So how to establish a good trading system and trading strategy? Can be obtained through a large number of historical data, now the computer is very developed, historical data detection and obtain is relatively easy. In fact, those who are interested in this line of work can get a proof of the positive system through historical data.
There is also a big debate here about the market changes. There is a perception in our industry that the market is constantly changing, that the market is constantly evolving. Personally, I think there are some local changes in the market, but the macro structure of the market is unlikely to change. Although computer technology is very advanced, and a large number of program trading, quantitative trading and high frequency trading have been put into the market, it only changes the microstructure of the market, and this change is only to accelerate the pace of the market.
Because we should not ignore that the main body of the whole market transaction is composed of human beings. From the perspective of historical development, human beings’ humanity is unchanged. Human beings’ attitude towards money is always unchanged. He has a fear of money that I don’t think will change very much. The macro structure of the market will change only if our trading entities change completely and become a different kind of creature.
No matter how advanced the computer technology is, we should not forget that there is a person behind it. As long as people are in control of the machine, the structure of the market will not change, because the machine cannot escape the control of human nature. This is my view of history. So history repeats itself. Human nature unchanged, the market has no substantial change. That’s why trading systems are based on probabilities, not on the success or failure of a particular trade.)
★ My system has two important components.
The first part is trend trading. Trend trading is when the price evolves in a trend manner. We all know that the market has a trend, but we don’t know when the trend will occur. We try to track the trend above the intermediate level by constantly tracking the price, by paying the cost to try to track the trend. When the trend occurs, my trading system will follow the trend. The longest order I hold for 6 months, which means I have to hold the whole intermediate level trend.
Chasing the trend of the whole market above intermediate, its main design way is here. So I’ve basically laid out the three basic principles for analyzing the market.
I think you’ve read books on investing, and I don’t know if you recall the three basic principles of market analysis:
1. The first price includes everything, which means I’m saying the market includes everything.
2, the second price in the way of trend evolution, is to admit that the market has a trend.
The third is that history repeats itself. All kinds of historical data and historical graphs that are constantly changing over time and space in the future. Because the data and graphics behind it are the reaction of human nature, the basic theory of human nature will not change, so history will repeat again and again and again.
These three basic principles are the premise of technical analysis, and I incorporate them into my system. So my system is alive, and it has important fulcrum.
The second part is portfolio investment. The concept is to treat all varieties equally without distinction, as long as it is the variety in trade. To me, no breed is close or close, they are just symbols. No matter how big or small the fluctuation is between different species, I have not favored or discriminated. By the way, TO answer some of the questions I’ve just asked, is how to handle it for small varieties, I think as long as you treat all varieties equally, you will find that the overall volatility of the market last year was not very high. Trend trading is having a hard time, and my best profit last year was in wheat. Strong wheat is so small that investors tend to ignore it. But it’s just that Chanter had a decent medium-term downward trend last year that a lot of people didn’t pay attention to. Let’s say you’re a portfolio investor. You’re a strategic trader, and you have money in Qiang Mai, so you have to pay attention. You are subjective and arbitrary to choose varieties, I think the component of judgment is very large, and more judgment will appear problems. Judgment is a double-edged sword, and if you get it wrong, it can do you incalculable damage. One of the important benefits of portfolio investing is that there is a local movement in different directions between the various varieties when the trend is not clear. So when the trend is not clear, my position may appear a few short or a few long state, so it will play a big role in the overall rise and fall of equity.
★ Features of my system:
First, the system has been running for eight years, which is a relatively long time. It has basically experienced bull market, bear market and flat market. So now I’m going to look at this and I think it’s ok. Of course, the comparison of equity is meaningless, the best of the best, there must be someone better than me. The system has been running for eight years and can achieve a smooth transition and positive benefits.
The second characteristic is that everything in the system is quantitative. I made all the trading elements made quantitative, open positions, open positions, stop profits, positions. I’m going to regularize all of these steps, and make it clear that as long as its conditions are met, it just has to do the right thing. This benefit prevents emotions from taking their toll on you and allows you to navigate the complex marketplace in an orderly way. The continuous persistence of operation is a very meaningful thing.
Third, the shock cost of this trading system is not high. The so-called shock cost refers to the impact of opening and closing positions on the price. What I do is the transaction of a long time structure, generally the shortest transaction time is above 20 days, so it does not have so much attention to the point of the price. It doesn’t matter how early the account is 10 minutes or how long it takes to get in. Price choice is relatively large, suitable for a relatively large capital, and there is no capital bottleneck. It is also insensitive to trading rules such as two-way transaction fees. The number of transactions is small, the fault tolerance is good, the width is also relatively large, do not need to change often.
Fourth, the implied risk is relatively small. Because performance is not achieved by position, the average utilization rate we now find retrospectively is only 30%. The size of the position is not very large, so the risk must be relatively reduced. In fact, there is really no good way to prevent and control the risk, as long as your position is small, this is the most basic way. The concept of the system has been verified over the years, it must be able to capture the intermediate above the market. Because the meaning of its own design is to chase the market trend above the middle level, there is no trend on the trouble.
★ Next, I will talk about the weaknesses of this system, because there is no perfect system.
I think the experienced investors here have seen, do the trend to do very cool, then oscillation period is certainly difficult to do. The biggest problem with systematic trend trading is volatility. This is the biggest challenge in our industry. Oscillating market, is the so-called flat market, how to deal with. To be frank with you, once the market enters the oscillation, my system will continue to pay costs back and forth to stop losses. And from the point of view of time, the loss of time is greater than the profit time, that is to say, the happy profit time will become relatively short, and the pain of the loss of time will be extended, most of the time is spent in suffering. Is there a perfect system in the world? We both know there isn’t.
The idea of some current designers is to separate the trend from the oscillation, and the trend will take a market-tracking approach and hold its position. And the oscillating market on the low to buy high, two stages to make money. The pursuit of optimization and optimization, trying to be perfect, I think it is impossible. If you can distinguish between these two forms and make money using different trading systems, you must be a money-printing machine. Because you’re guaranteed to make it, your money will roll over. Earn the money of two periods by distinguishing two kinds of quotations, and the amplitude of your capital accumulation must be larger than that of the national bank. It’s going to be bigger than the Federal Reserve, bigger than some of the biggest international companies. A: Good point! No more wishful thinking! Because compound interest is amazing, 50 percent compound interest is 57 times more than 10 years, and if you find the perfect money printing machine you’ll be one of the richest people in the world on the smallest amount of money, so there’s no perfect thing in the world. If you want to optimize the system with multiple parameters, it will first lead to inconsistent continuity, where you use one parameter in phase A and another parameter in phase B. Your system is not a quantitative trading idea. This is a selective, judgmental trade, which can lead to confusion. The most important thing in quantitative trading is to find a positive system and then do it continuously to keep it consistent. You still have to pay the cost, recognize that there is no perfect system.
★ So I just talked about the importance of portfolio investment in the oscillating market on the full show.
When weaknesses in the system are recognized, many preventive measures can be taken in advance. So there’s a good result: IN all my years of doing this, I’ve never had a retracer of more than 20%, and my biggest retracer was 17.5%. It is because of good risk prevention and control. There are two things that are guaranteed to make it,
The utilization rate of the first fund has always maintained at about 30%.
When the 2nd trade, do not add storehouse, ask everybody to listen to my trade is do not add storehouse trade. Unlike some traders who like to gradually break their positions before adding to them. In order to maintain safety and stability is not added to the warehouse.
The third is portfolio investment, which can fully play a role in the volatile market to prevent risk. When the oscillating city, the local different movement of commodities is the most distinct. In fact, when systemic risk occurs, generally speaking, commodities basically rise and fall together. But in the oscillation period each breed has its own merits. For example, when the year before last cotton suddenly pulled out a wave of quotations, other varieties are not what quotations. So a multi-variety portfolio can reduce risk, and only when it’s stable can you continue to trade with confidence. Quantitative trading execution is a big key, if you are unstable, in a state of volatility for a long time, then certainly not good trading. Our company’s policy is to suspend trading if you lose 20%. 20% is a challenge for any of our traders, and if you hit that stop, I personally don’t think you’re a good trader.
★ The last thing I want to talk to you about is the issue of implementation. Frankly speaking, I couldn’t sit down and fully implement it for so many years, because I am also human and emotions affect me. Trading is very difficult, my execution is above 70%, but like the trading system I mentioned, basically as long as the execution is above 60%, you can make profits. 70% basically can get more satisfactory income, to achieve 100% is a very high requirement for people. Especially after losing five in a row, your sixth order isn’t as consistent. Personally, I’m only at 70 percent execution right now. If the realm is a little higher, then I have room for improvement. Today I have done about the trend trading, quantitative trading speech so far.
- This reply was modified 2 months ago by Z-Studio.
- OrganizerJuly 27, 2021 at 12:20 pm
10 years of experience, trend trading is actually this sentence: shock resistance
fact, the specific way to deal with the shock is not important, half of the profit retreat or 2B. In short, the awareness of dealing with shocks is the most important. For trend tracking systems, this is the shortest part of the barrel, and the shortest part is about survival. In fact, trend tracking systems deal with shocks as much as stop losses and money management, but few people really realize this.
Trance, the transaction has been more than 10 years. During the sour, sweet, bitter, hot, really only each trader knows. Along with the constant small loss of helplessness, no breakthrough of depression, understanding and progress of this spiral upward.
In fact, the specific way to deal with the shock is not important, half of the profit retreat or 2B. In short, the awareness of dealing with shocks is the most important. For trend tracking systems, this is the shortest part of the barrel, and the shortest part is about survival. In fact, trend tracking systems deal with shocks as much as stop losses and money management, but few people really realize this.
This article will explore this issue in more depth from systemic importance, to the design of trendfollowing systems, to the improvement of systems and finally, to my personal capital curve statistical chart.
Importance of the system:
The old bird that did more than 5 years has experience, depend on dish feeling to do at the beginning, but the stability that discovered inspiration is far inferior to the system after deficient pain, dish feeling can magnify the weakness of the person infinitely, and human nature is what we cannot resist, only use system to rule. If you’re still trading by inspiration, it’s time to start building your own system! You don’t believe me? I didn’t believe it at first either, but time and money change your mind).
What is a trading system? It is the quantitative performance rules of your own trading ideas. First there is the trading idea, then there is the trading system, and the order cannot be disorderly. As you become more experienced, your trading philosophy will inevitably spiral (personal savvy determines the spiral cycle). And the trading system will be constantly modified and even completely overturned by yourself, which is very normal in the previous years of trading, we are all human, will make mistakes, have the courage to overturn the past self. In order to go further in financial transactions.
I can never emphasize the importance of systems too much, I prefer to build my own systems rather than use generic ones (such as turtle or 10/20 crossings, both of which are profitable). Financial trading preconceptions are very dangerous, with what is the first rule of the day to stop losses, it is because I have tried to reverse the trend of heavy positions to die, know that this is a death, so I accepted these general rules. For the system, why should you make money if other people make money? The same system with different ideas is also a dead system.
Your own is the best, others will not use, the key is that you are the system, the system is you. There was no fighting or conflict. When your system no longer adequately reflects your trading ideas, improvement is needed. I’ve had about a dozen versions of my system since 5 years ago, and every time I think it’s perfect, but it has to be improved in the end, and I’m sure it will be again. By the way, there are several versions of dolphins in the line of fire, suggesting that a spiraling system driven by ideas is inevitable.
My original system building and trading ideas
10 years ago, I made the same mistakes as a beginner today. Then I started reading classic textbooks and started on my way to becoming an index scientist. Slowly found that this seems to be a dead end, and then read a lot of classical comments, what three stages of go, 9 chess and 5 chess, after the match found his direction is off.
Listen to the seniors, after all, their tuition is higher than me. After that, I kept reflecting and reading the books of my predecessors to find the common ground of their ideas. Slowly, take advantage of potential light storehouse to stop loss day word the first principle immersed my trade soul, do not set now stop loss with respect to all over uncomfortable. I sincerely hope that the new people must also hone their own, the anti-human temper into their second nature.
After having some fragmentary concept, the train of thought also begins to clear gradually. Light position, stop loss these two are not difficult to understand. Objective rules, against the human nature is not difficult to do after the discipline. The question is what is homeopathy? The concept is too vague.
I can’t find the answer. And so the pain began.
The home also every day the homeopathy hangs in the mouth, as long as the OK. If I tell you that these two words are specially put after the fact, you will not scold me, first think carefully and then scold not late… You say a trend is a trend. What if there is no trend? A rest? By the time you see the trend, it’s almost over. If you still can’t figure out, block large sections of the chart trend with the right hand, leaving only the left concussion. You don’t put your right hand out. Is this the right trade? No. You put your right hand, and now you’re in. It’s amazing. Now think again, are these two words important?
I was already aware of the problem, and the breakthrough was painful. Ideas are constantly colliding, ideas are constantly being overthrown by themselves (the frame of ideas is not yet formed). The final breakthrough point is back to the system this point.
Systematic classification and distinction
When you encounter a bottleneck cannot break through, must go to the simple place to think, the simpler the better. Think about the nature of trading, the nature of markets. The textbook says the market comes in many shapes: head and shoulders, flag, wedge, double top… At that time, I was very painful, you told me the double top down the empty sheet is the trend or the trend, broke the neck line fell empty sheet is the trend, not broken rebound new high is the trend. Conflicted and suffering… After a period of thinking, finally returned to the essence of the market.
All markets have only two states: volatile and one-sided. (volatile one-way upswing or one-way) trend or no trend. And two kinds of market state only the operation of the corresponding techniques to make money, the shock of the market to sell low buy high, unilateral market chase down. 2 market conditions with corresponding manipulation, coupled with strict stop losses. Profits seemed to be beckoning just around the corner. Believe that the novice is currently such an operation idea, this idea is very perfect, there is only one question: how to judge is now unilateral or concussion? BOLL opening, ADX, or other indicators. Is there a price first or an indicator first? At this point, I was stuck for a year! Maybe you will, but I can’t. So, profit waved, smiled and turned away…
I ask myself have no talent to judge the shock or unilateral, so can only use a manipulation, or all low to buy high sell, or all chase up kill down. In fact, now it is obvious to follow the market, and buy low and sell high is against the market, but at that time, his concept is a mess, and experience is not enough. Just day-to-day pain. Back in the day, I decided there was only one way to do it… My subconscious mind tells me to chase the rise and kill the fall, and the classic books of my predecessors teach us the same. But, skeptical, I tried a lot of both.
If you can accurately judge the shock or unilateral, or if it is your target, the following text may not be of reference value, because I did not choose this shortcut and directly and market hard work!
The framework of my trading system
At that time, after a period of trading, slowly summed up the different results of the two systems. Concussion manipulation – low buy high sell: the success rate is higher, but most are small surplus. Indicators are so sensitive that once the inverse cross has to come out immediately, the inevitable stop loss can wipe out small gains, and this is only when there is no clear trend in the market. Once the market has a very dramatic rise or fall, the shock technique only chase high, small profit, chase higher, then small profit, chase higher… Add the occasional stop. A 1,000-point rally can be a 200-point gain or less. Unilateral guse — pursue rise to kill fall, rise sharply drop the quotation does not say, affirmation can earn, but when the market does not have obvious trend, positive stop loss is anti stop loss or stop loss, repeated slap in the face believes everybody also has experience certainly. How to do? The deal seems to have reached another dead end…
At that time, I had the horrible idea that all the little stops were flattening my capital curve. Thus the first principle of heaven wavered. Now I think if I was not firm enough at that time, the consequences are self-evident…
Finally, after constant reflection, the spiral began to rise. You’ve all heard it, loss is your decision, profit is god’s decision. Shock technique I asked myself unable to optimize, are small loss small surplus, only to improve the success rate, I do not have this talent. Unilateral approach is more in line with their subconscious, I am not afraid of profits to losses when holding positions, and 30% of the success rate and the potential to improve. So personality determines my manipulation and system framework.
I am not qualified to evaluate whether the shock system will eventually be profitable, because it is inconsistent with my character and philosophy. But I do believe that every technique has its own unique feature, as long as it suits your philosophy, fits your personality.
System optimization and run-in
Eventually, I slowly built my own trading system, but if you think that if you create your own trading system and follow the basic trading discipline, you will be able to make a profit, you are wrong. All the steps above, including the basic trading framework and trading concept, I used three years to complete the basic. At that time, I also thought that with the system and their personality match degree, as long as the appropriate increase in the success rate, a few weeks can be stable profit. As a result, the profit waved and walked away without even smiling…
After establishing the trading system, the next step is to optimize and run in. The initial system framework is just the soul of your trading idea, nothing substantial. Of course, the soul is the most important, which is why I’ve been reiterating the importance of systems. The initial system, for example, only points the way forward. The important thing is to move forward step by step.
This phase of system optimization and run-in is very long and painful. This is because your trading experience will grow more slowly and your ideas will grow more slowly than they did at the beginning. In the process, you may have been able to make a very slow loss, but you are still slowly dying… For me, there was no Epiphany at this stage, just a gradual realisation. To the market, to the system, to itself. Do not remember the middle of the breakthrough, only know that he was suffering and strong…
Next comes the focus of this topic and my main purpose: trend trading – how to deal with 70% volatility! If you are using a trend system (e.g., a moving average), if you are more than 4 years old, you will definitely have a lot of resonance.
For example a average line, it is all quotation comes when unilateral operation, the quotation flies directly when good luck rises, when bad luck big profit changes loss, or hit stop loss directly. As we all know, such a technique in a clear trend when it is ok, the market to head pinch tail can still leave 70%, 80%. However, in a large number of trendless markets, basically all the profits should be taken out. In simple terms, it is a big step forward, 3 in the loss, and the loss is basically gone. How to do? Someone said, “Rest during concussion, no manipulation.” That will return to the old topic of judging the nature of the market, how to judge the future is concussion, or trend?
Trend trade is in fact a word: shock resist live. The next step, now we don’t have to consider the unilateral market, earn more earn less. What the textbooks say: Watch your losses, profits will take care of themselves. Now we will stare at the loss, black box how much you lose, recovery! The chart at hand will answer for itself. In the past, I slapped back and forth, profits became losses, unilateral profits were all wiped out, and the most important thing is that the confidence in trading was too big. Capital curve is always concussion, occasionally new highs are false breakthroughs.
I believe that more than 5 years old bird deeply touched, how to fight the past, the following is my experience, maybe you also have similar inspiration or idea!
In general, the idea of operation is
Big cycle judgment trend – small cycle entry – move the stop loss to cost – see major cycle stop – stop change check tracker – touch check tracker – big cycle trend change.
My system idea is such, all quotation is done when unilateral, do not open a position actively and let itself develop, it is to raise ceaselessly stop a loss only. When encounter inevitable concussion, small cycle stop loss + move to cost as soon as possible, the system will not return the slap. And when the big unilateral, I believe there is a good performance, after all… We’ve got the “loss” under control, haven’t we?
I feel some details are still unclear:
1, large cycle judgment trend – into the single or empty single
2, small period admission (order of magnitude should not be too big) — filter small period reverse wave, trading on the right side.
3, set stop loss – according to the small cycle chart trading system.
4. Move stop-loss to cost price – move after “appropriate” profit in small cycles.
5, admission work is over – turn off the small cycle, go back to the large cycle chart.
6, if the touch stop loss, repeat 1~5.
7. If the big cycle shows a favorable trend, stop losses to move in the favorable direction – according to the big cycle chart trading system.
8, touch stop loss (stop win), cycle above operation…
9. After the turn signal appears in the higher stage cycle, the signal operation in the same direction is performed in the lower stage cycle, and the reverse signal is filtered out. That will increase the odds. Stops continue to move in the trend direction of the higher cycle.
10. If you want to seize the unilateral market, you must abandon the thinking of frequent operation in a short cycle. How to avoid frequent trading? You can only choose to close positions using signals with higher time periods. However, entry still has to be in small cycles because the stop loss cost is small.
11. After entering a small period, move the stop loss to the opening position as soon as possible (appropriately) to ensure the safety of a single trade.
The above points are in order of increasing importance!! Especially the last one! Can be said to be the soul of my idea!
Trend trading, big market to have big profits. N years ago, I thought about the market every day, the breakthrough on the price to double, the breakthrough on the market to collapse. In fact, the real market 1 year 1 wave may not have. Now I know that systems are designed for worst-case scenarios, and you’re only qualified if you can survive them. Trading needs a pragmatic spirit, dare to be bold (let their own profits run), but also to be good at losing (small cycle stop loss + move to cost). I think only these two points, is a real introduction. You can talk about mentality, you can talk about discipline.
I want to stress again:
1. Disorderly swings can take you out in a row. The market doesn’t respect us, so it’s important to move quickly to cost.
2. Always design and optimize your system for the worst case scenario, rather than trying to make more money. The less you lose, the more you earn.
Stop losses with small cycles and stop gains with large cycles
The development of trends starts with small cycles, then gradually develops and grows, and eventually develops into a big trend.
The smaller the selection of the admission cycle, the more can save the stop loss, save the stop loss will reduce the cost (currently also use 1H, 4H admission).
Doing foreign exchange is the same as doing business. You never know when guests will come to visit you, but if you want to make more money, reducing costs is definitely the best way.
Trading facts: Look at your trading account for the reasons
Most traders can’t afford to lose. They hate losing, keep moving stops, find excuses to keep trading, and justify their actions in any way they can. When they still have money in their accounts, bad traders keep deceiving themselves and ignoring losses until they are so big that they have to walk away with huge losses.
They do nothing while things are still under control, hoping for a deal to turn around. They think they have a chance to prove themselves right as long as the trade continues. They can avoid admitting their mistakes while trading continues, because they haven’t suffered a loss yet! People are very reluctant to admit mistakes, and most people can’t afford to lose because they’re bad traders.
Understanding that losses are part of trading is the first step to success. If always can’t afford to lose, then doomed to poverty. Successful long-term trading requires people to be able to lose.
I’ve lost money a lot of the time in my trading career. On average, MY short-term trades make money 50% of the time, while my midline trend trades lose about 30%. So, since I can’t always make a profit, I have to be able to afford to keep trading, or ELSE I’ll be broke and forced to stop trading. I hope you can afford to lose.
If you are now profitable, you can skip this paragraph. If you still lose money, keep your head up, put down your pen, and stop paying attention to the market! This paragraph is completely for your sake, please stop all transactions!
If you have lost money on a trade and are struggling to recoup it, the best thing to do is to leave your trading account alone. I know it’s hard, especially after the frustration of walking away. Don’t think about it that way, it’s not a failure, it’s just a matter of putting off trading until you think things are going to be better.
Don’t let your head down. It’s in your best interest to stay in shape. Losing money is no big deal. It happens to everyone. I’m proud of being able to lose a lot of times. (You know, losers are long-term winners.)
If you lose money, I want you to think carefully about what I’m about to say. The most important reason to lose money is the wrong method, not your knowledge, it is the authority of your trading trainer that you believe in, not your state of mind. Mental state plays a role, but it’s not the main factor.
Please find the reason from your trading account, it is the improper method that made you lose money. You should verify the validity of your method. You will find this reflected in your trading account, where it is not difficult to see the flaws in this approach.
So take a deep breath, stop trading for a while, and start thinking about real trading knowledge that will teach you the right way to validate your trading ideas.
Listen to me, if your trading account is still in the red, it’s no big deal, because you’re not alone. There is even more miserable, that is more than 90% of the traders are lost! Let me tell you why.
Although many analysts believe that the primary reason is psychological factors, I insist that the deeper reason is credulity and laziness. It’s human inertia that makes traders try to cut corners, isn’t it? Everyone wants to make an easy profit.
- OrganizerJuly 29, 2021 at 7:28 am
A better understanding of homeopathic trading
Dow Theory, the originator of technology, tells us that prices move with inertia. Investors can only do simple and happy trading if they understand the direction of the K line and follow the trend. In nature and social life, there are only deterministic events and random events. Investors should understand that trading itself is a game of probabilities with randomness and there is no 100 per cent certainty. Recognition and acceptance of this is the basis of our opportunistic trading.
So, what are the trends? A trend is simply the direction of price movements in a given period. In a given period, the price is unable to break the specified trend line and inflection point line, the market will continue the previous trend, we call this trend. Generally speaking, there are three main kinds of trends: upward trend, downward trend and shock consolidation.
There are many ways to determine a trend. The most commonly used tools are moving averages and trendlines. When judging the trend of the moving average, the main use of the arrangement of the moving average group to distinguish, and we will have time to discuss in detail in the future. This paper mainly takes the drawing method of trend line as an example to judge the trend. For example, in an uptrend, the market price in a certain period of time to break through the previous highs, new highs, but the correction process does not fall below the previous low wave, this is an uptrend. The downward trend is judged by the same method.
When the trend is running, it is often accompanied by volatile market, which brings certain difficulty for investors to trade. The market is volatile 70% of the time, but 70% of the price space is produced in the 30% trend. This also warns investors, in the face of volatile market, more need to be patient. Volatility is harder to define, so it is not so easy to judge. The more common concussion is the high flat, flat low rectangular finishing; The high point becomes low, the low point raises the convergence triangle arrangement and so on.
In order to better carry out the trend of trading, the choice of time cycle is particularly important. Generally, the judgment of the trend needs to be found in the daily line level k-chart. First of all, daily chart can well avoid the interference of short-term fluctuations, and at the same time, it can provide longer trust and operability for trading. For a mature trend trader, a year or several years or even one direction can be very profitable.
Many investors know the importance of the trend trading, but lack the belief to carry out the trend trading, influenced by the short-term market and time to change their views, leading to everywhere hit the wall. Need to warn investor here, the idea of the most core of the trend trade is not to predict the market, but to follow the market, do the market of persistent believers. The strategy is to follow the price when the market moves and participate in what has happened, not what will happen in the future.
As said before, trading is a random game of probability, as a homeopathic trader, must also bear the uncertainty that may exist in the process of trading. As the saying goes: there is no market that only goes down, and there is no market that only goes up. A long or short trend has an end, as a trend trading investors, in the face of a reversal of the trend, often slightly passive. So homeopathic trading, must be combined with position and risk control to carry out more effective.
Take the recent trend of silver as an example, does the market change the previous downtrend, or is it just a short-term adjustment? We must have a certain judgment basis, can be more objective, more calm to deal with the market. This is where other trading tools outside the trend line come in handy. The author usually refers to the golden section rebound position when judging whether the trend has changed. If the rally is not above 0.382, then the bearish trend remains unchanged. If the market is in the 0.382-0.5 rebound range, then in accordance with the shock train of thought to cautious operation. If you stand at the 0.5 rally, the trend is completely broken. Trend traders need to be patient to wait for a new trend to clear before entering.
Conclusion: the pursuit of trading avenue to simple, but any trading method is not perfect, so is the trend of trading. Investors should choose their own method according to their own style preferences, slowly on the road to steady profit in the market. Once you have established the way to trade on the trend, always be a hunter to follow the market.
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