article originally from FMZ.COM ( A place you can create your own trading bot by Python, JavaScript and C++)
If you find or believe that there are many loopholes in using traditional techniques to guide trading, then this article is worth your reading
I originally don’t want to write a trading article again, because I want to write a piece of content that I am satisfied with, and most people also feel good. When the article comes out, it is not realistic in theory and in practice. Still writing it, still willing to share, I just assume one day, a successful trader said that I have seen my article and inspired by it.
How pleasant it is.
Many people have realized that the real trading system should be simple, but this simplicity is not simple. if you tell people a simple and effective thing, they may not use it, they may even complicate it. Sublimating the trading method to the philosophical level, and then simplifies it into a code of conduct, specific it to the details. This progress, you must take a trip inside and successfully come out.
There is no standard answer to how to understand the nature of the market. I tend to think that the essence of the market is correcting mistakes. When the public is wrong, there is a market. This is not a nonsense, it has practical guidance. if you are used to trend trading, you will enter the market when others are shocked by others. Entry market time can be established from some technical indicators’ "divergence". Many people use divergence and may not know why the divergence is effective. The effective divergence I understand is that most retail investors stay in the last pattern of thinking (They are wrong!), and the market suddenly reverses to make them losing money.
I am really reluctant to take out the above “the real stuff”. I’m taking it out now just to testify to a point of view. “Seeing the road does not go” and “Never obsessed with appearance”. Technical indicators, some people call it a toy. You have to look through it and treat it as a “Reference object”, not just use it to simply judge the long and short. The core of "seeing the road does not go" is not only rely on the experience, but not deny all experience. You need to choose the best strategy according to the specific situation.
Defects in your trading system are inevitable, but if you can't make money at all, there is a problem with the design of the system itself. At this time, you have to reflect on whether you are lost in your own thinking or Imprisoned by some kind of real environment facts. You have to seriously think about how to “not obsessed with appearance".
The market always develops along the minimum resistance, and most people are doomed to be wrong, "seeing the road does not go" is to understand the true intention of the market. Not just the technical indicators, not the historical experience. If you find all these thinking against your system. Please review your trading system.
Many times, you feel that the market is always playing with you, and people can't help but suspect that the market is a conspiracy place everywhere. I think, the news on the market may have conspiracy, but the market itself is not, because the price has been clearly shown to everyone. How to judge, how to formulate a strategy is not part of this article.
But if I end up like this, I am afraid that readers will think that this is just another article of empty words. So, I will get the archive files from my computer. Which is an early diary article of mine, but at the time it was a summary of the experience that I was very reluctant to share.
What time will the trend line is effective: It lasts for a long time and has been effective many times. Compared to current k-line time period level, the amplitude is not too big.
A certain time period level of K line extends along the same as the moving average line. Then the moving average has the similar function to the trend line.
The slope of the K line is much steeper than the usual average line, and does not occur in the initial segment, then the band end with a reverse breakthrough of its own or a sub-level moving average line as a signal - the market is evolving, there may be a reversal, there may be continue the original direction, so it is very reasonable to close the position, and then make a new order after patience waiting.
If it is not a large trend level at the day level, the 1-hour chart is the basic observation window. And the retracement of the day level is also can be 1-hour as the basic window.
If 1-hour chart is in the narrow channel, basic observation window is 4-hour.
A strong unilateral trend may be accompanied by a strong retracement; a possible strong retracement (significant type, continuous strength) need to close the position, you can even try to make a profit out of the retracement. If the strength is unsustainable, which means the retracement not established, evolved into a strong retracement, or a weak retracement (the retracement is more sustained in time than in space). The weak retracement will return to the original trend and you can open a large position.
3 locations to entry the market:
The top place entry: assuming that the place is the pole, the basis for the judgment is the trend line. Since it is assumed to be the top place, it must be a very limited fault-tolerant space; if the stop loss has been reached, close the position immediately. Never hesitate. Waiting for the new directions.
Inversion point entry: reversing in the obvious support and resistance position. Or the previous trend is being damaged, the new trends may begin; Or the retracement ends and returns to the original trend. The stop loss is set at the 1/2 neckline of the trend line.
Chasing the trend entry: when you missed 1 and 2 entry positions, found that the market is still strong, it will be no retracement opportunities in the short term, when chasing buying long or selling short, the important K line is the K line that prompts you to opening the position, if the direction moves to the opposite way and broken the highest or lowest edge of this K line. Close the position and stop loss immediately. It is possible that after the stop loss, the market moves in the original direction, or evolve into the way of tunnel moving. Do not regret, looking for opportunities to enter the market again after observation and confirmation. When the top place entry situation occurs, it is best to find a narrow tunnel market; the large band is more difficult to evolve into a "tunnel", and the current inertia is likely to break through the possible tunnel lines and become a complex seesaw.
Reverse: The retracement time of the confirmation is positively related to the size of the previous wave. If H1 reverses cross MA23 and H4 leaves MA23 still far away, not eager to enter. Wait for 3 or more k lines to completely leave the moving average.
H1 or H4 k line mature growing time need an early chase (three types of entry points). In the late stage, it is not advisable to chase. If there is no "late stage", it must be in a larger trend.
If it is a big trend, even if you miss a band, you still have a chance to enter again. Before the day level trend is not formed,
The hourly chart determines the appearance of the basic window. If the market evolves into a general trend, then it will be.
Understand, stabilize, and make sure the risk ration before doing it; the good trend will definitely give you a clear signal, only you wait patiently! ! !
article originally from FMZ.COM ( A place you can create your own trading bot by Python, JavaScript and C++)
