The stock market is an open capital game market, where the strong eat the weak, and the wise can get whatever they want from it. The weak seem to live at the bottom of the biological chain and will never get rid of the fate of being slaughtered. Stock trading is like fighting. Getting a good set of skills is like getting a sharp weapon. Good technology can go beyond human brain analysis, and exquisite analysis methods can let you get the invisible stock market password!
One of the secrets of successful trading is to find a trading system that suits you. This trading system is not mechanical, it must be suitable for your own personality, and it must also have a complete trading idea, detailed market analysis and overall trading plan.
The main advantage of using mechanical trading system is that if the trading system runs normally and keeps pace with the market, it can bring stable risk return rate for a long time.
The trading system should achieve the following three objectives:
(1) The timing of entry and exit must be improved.
(2) You should keep a profitable position as long as possible.
(3) We should withdraw from the loss-making position as soon as possible.
Finally, the application characteristics of a good trading system are summarized.
(1) The most attractive thing about a good long-term trend tracking system is that positions are often based on the starting point of the trend, not the direction of the trend.
(2) A good trading system allows you to keep your original position when the market continues to benefit you. Once the market is unfavorable, it will stop you from quitting, and if the trend reverses, it will also tell you to operate in the opposite direction.
(3) The stop loss point may be set too close, as long as a small technical callback will be washed out, or too far, when the trend reverses, most of the book profits will be taken back.
(4) Correctly adjusting the stop-loss price is the most subtle and perfect art, and it is also the key to a trading system. When designing a successful trading system, the most difficult thing may be to find a way to solve how to adjust the stop loss point to a suitable position.
(5) When prices are arranged horizontally in a wide range, this situation is more common than the fierce established trend. People who trade according to the system will always buy when they rebound and sell when they call back. This kind of dish washing loss is inevitable for homeopathic trading. Traders must be patient and wait for big fluctuations.
(6) The trading system allows you to keep going in and out, and at the same time, you will also lose money. At this time, you must be patient and obey the discipline before you can do what the trading system says. But our experience shows that once you insist on using a set of feasible homeopathic trading methods and abide by consistent results, it will be much better than repeatedly doubting its ability and constantly trying to improve it.
Facts have proved that in order to be in an invincible position in trading, we must use a mechanical trading system to regulate our trading behavior and not let ourselves get lost in the "trap" of intuitive trading. Its role must be a beacon of our thoughts and a guide to our actions. Mechanical trading system means constraints, and we should accept this constraint and make it a part of trading life and a natural habit.
There is only one way for us to track the market, that is, to establish and strictly implement our own trading system.
Just don't flatten the profit position for fear of loss.
That is, when rebounding, you should forget your fear and stick to the action of adding more empty orders. Don't be greedy when it's time to stop loss and take profit. You must appear at once without hesitation!
Too much trading experience has proved that subjective prediction and judgment can never be compared with simple and firm implementation of an objective trading system.
Therefore, system traders must concentrate on trading according to the existing system signals and keep repeating the profit model, so that your wealth can grow steadily.
Practical volume decryption
1. Re-decryption
"Heavy volume" refers to the recent formation of stock trading volume has an amplification trend compared with the previous period. It mainly occurs in the "opening period" and "shipping period" of the stock, as well as when the stock price starts, rises and breaks through the previous high point or important mark. Because the enlargement of trading volume is jointly promoted by buyers and sellers, it is easy to appear "heavy volume" at the turning point of market trend and the establishment of new situation, because in these positions, the differences of views on the market outlook are gradually increasing, some people are firmly bullish or bearish, and some people are firmly bearish or bullish.
During the opening period before the stock price rose sharply, two groups of huge "volume piles" were formed, which were the perfect annotations of "volume". They released a huge volume of transactions in the opening period, breakthrough period, rising period and even delivery period.
2. Decryption and decryption
"Shrinkage" refers to the trend that the stock turnover formed recently has decreased compared with the previous period. Continued "shrinking" means that the market transaction is extremely light. During this period, most people agree with the later trend of the market, and their opinions tend to be consistent.
(1) Shrinkage rate decreased.
Most market participants are very bearish on the market outlook, only some people sell and few people buy, which leads to the continuous shrinkage of trading volume and the decline of stock price.
Due to the high price and the bad environment of the whole stock market, the stock price continues to fall, and the trading volume is also shrinking in the process of falling.
(2) Shrinkage increases
Most market participants are very optimistic about the market outlook, with only some people buying and few people selling, which will also make the trading volume continue to shrink (or shrink to a stable level) and the stock price rise.
Due to the firm optimism of most people (including the main players), the trading volume below it decreases with the rise of their share prices in their respective "main rising waves".
The rise and fall of shrinkage generally occurs in the middle of the trend, that is, the "main rising period" and "main falling period" we mentioned earlier. During this period, everyone's views on the market outlook tend to be consistent, so if this happens, you should confidently hold it or decisively go out.
Another situation is that the stock price will often shrink, which is the "washing stage" of the main force. After each large-scale opening, before the stock rises sharply, or in the "shock stage" in the process of rising, in order to drive away the floating profit and reduce the pressure of rising, the dealer will lower the stock price to varying degrees, and during this period, there will also be obvious "shrinkage" phenomenon below the stock price. This "shrinkage" is the best test of the degree of control of the main force and the attributes of market chips. Often the more thoroughly the turnover shrinks, the stronger the control ability of the main force, and the greater the potential of the stock in the future.
3. large-scale decryption
"Huge amount" means that compared with the previous period, the stock trading volume has soared, and even hit a new high in the past year or two.
"Huge amount" usually appears in the "breakthrough stage" or "shipment stage" of the subsequent shares of Dark Horse.
Dark horse shares are famous for their rapid and sharp rise in a short period of time. This kind of banker is to play high control and then pull it up quickly in lightning speed. This rapid rise is like human launching a rocket, which needs huge energy to push it. In addition, the big bull stock is the same when it starts.
When the stock market is hot, it can always attract a large number of followers, and some speculative funds will also take this opportunity to make a fortune. They just want to make a quick profit and don't want to invest for a long time, so it doesn't matter what stocks they buy, because all they want is the price difference, so some junk stocks and unpopular stocks with small circulating share capital and convenient operation have become their targets. Speculation of such stocks mainly uses the popularity of the market to mobilize people's popularity and realize themselves with the help of retail investors. At the last moment, the main force will make desperate use of the chasing psychology of the majority of small and medium-sized retail investors, throw out chips and flee quickly, which will also form a huge turnover.
4. Decryption days
Compared with the previous period, the recent turnover has not only increased substantially, but also reached a record high. This kind of "turnover column" is usually called "turnover days"
The occurrence of "the amount of days" is an extreme situation and not common. Because of the high turnover rate, it is difficult to appear continuously in a short time, and it is usually based on "golden rooster independence". Generally speaking, it only appears in the "bottoming stage", "initial stage", "shipping stage" and "main rising wave" of big bull stocks, or under special market background.
In the gaining stage, the front, middle and back positions form a "sky volume". Generally speaking, individual stocks form a "sky volume" under the background of the continuous downturn in the stock market environment, and then look around in the months before and after the "sky volume". The overall trend of stock prices tends to be stable or stronger than the broader market, which requires special attention. It is very likely that this is a big bull stock.
The increase of big bull stocks is long-lasting and huge, and it also needs a particularly huge turnover as the driving force when it breaks through. Therefore, some bull stocks will form a "day volume" when the "main rising wave" starts.
5. Decryption of ground quality
"The amount of land" corresponds to "the amount of days", which is a name for the extremely shrinking turnover.
"Land volume" is also an extreme situation, which generally appears at the ultimate bottom of the big bear market or at the early stage of the rebound after the "main decline" of the stock price.
After a long bear market, the value of most stocks has already been highlighted, and all the stocks have been thrown almost. However, in the case of investors' extreme panic and weak mood, not many people dare to enter the market, so many stocks often appear "land volume" during this period, which is also the dawn period.
During the "main decline" period, the ones that were thrown out were thrown out in succession, which eventually led to an extremely shrinking turnover. At this time, as long as the stock price is slightly bought, it will raise the stock price. Once the stock price is pulled up, it will immediately get the response of short-term customers and lock-ups, which will lead to the stock price rebound.
6. Measuring pile
When the ever-increasing volume of transactions is aggregated, it will form a hill-like volume group, which I habitually call "volume pile"
"Volume accumulation" is also a manifestation of volume, but it belongs to continuous volume, and it is mainly "large" or "huge", so it also appears in the opening period, breakthrough period and shipment period of stocks.
7. Tape measure
"Volume belt" can also be said to be another expression of "volume pile". The stable and continuously enlarged volume will form a "volume belt" when aggregated.
The "volume band" mainly appears in the "opening period" of stocks. When collecting chips, some bookmakers have special plans and pay attention to the discretion, and limit the trading volume to a certain range every day. Over time, a "trading volume belt" has been formed.
Measure essence
There will always be some particularly prominent "measuring columns" interspersed in the "measuring pile", which is "measuring precision"
"Precision" is often distributed in an important position and is the whole group spirit of trading volume. It has traction and enlightenment function, rich ideological connotation, and has important practical significance in judging the nature of the pile and guiding the operation of the firm.
Four taboos and five noes in the stock market
The basic contents of the "Four Taboos" are:
Avoid buying stocks that are too unpopular. This kind of stock is likely to be difficult to sell for a long time, making you suffer from the difficulty of realizing it.
Second, avoid being too impatient. Impatience and panic, often buy stocks at an unreasonably high price, sell them at a lower price, and suffer undue losses.
Third, avoid excessive hot brands. Overheated stocks are often manipulated behind their backs, so they rise and fall the most violently and their changes are the most elusive. Often when you think you can make a lot of money, you actually lose the most.
Four taboos are slow. As long as there is an opportunity to make a profit, we must make a decisive decision and don't hesitate. If you can't make up your mind, you will often miss opportunities.
"Five noes" refers to:
Don't blindly follow the trend. Seeing that others are buying for fear of falling behind, they are eager to buy unfamiliar stocks, while others just sell them at will without asking why. The result is often fooled and swallowed up by market manipulators.
Second, it is not insatiable. When the stock price rose, he was bent on pursuing higher profits and refused to sell his own stock. When the stock price fell, he was bent on thinking that it would fall and refused to buy it. In the end, everything is empty, and greed will bring you failure.
Don't gamble with shares. Some people always want to make a fortune, and they can't wait to grab a stock sacrifice and turn it into a golden brick at once. When he made a fortune in the stock market, he was blinded by the profit, and he wanted to bet all his property. When he loses, he will lose his eyes and put all his eggs in one basket. In the end, he will lose everything.
4. Not affected by external trends. Some investors have made a trading plan in advance, but they are affected by external trends on the spot. When the stock price rises, they sell as planned, but when the stock price falls, they buy instead, and finally miss the favorable trading opportunity in vain.
Five is not expensive or greedy. Buying at a high price often brings bad consequences to investors, while buying at a low price may not have a good result. People who are bent on buying bargains should remember that "bargains are not good"
The mentality of successful traders in stock trading
1. Use only the money you can afford: If you use your family's money to invest in stocks, you are doomed to fail, because of this, you will not be able to make a sound trading decision with your mental freedom. One of the elements of success in stock trading is ideological independence; In other words: "The decision to buy or sell must not be influenced by the fear of losing family funds."
2. Know yourself:
You should have a calm and objective temperament, the ability to control emotions, and not lose sleep with the sales contract. Although this kind of kung fu can be trained, successful traders always seem to be calm in the process of trading. "In the stock market, many exciting things happen every day, so you must have a decisive attitude and be able to cope with the short-term market situation, otherwise you will change your mind and shrink your direction many times in just a few minutes."
3. The investment should not exceed1/3;
The best way is to keep your trading capital three times the margin required to hold the contract. In order to follow this rule, there is no harm in reducing the number of contracts when necessary. This rule can help you avoid using all the trading funds to decide on buying and selling. Sometimes you will be forced to close your position in advance, but you will avoid big losses.
4. Don't base your trading judgment on hope:
Don't expect to make too much progress at once, or you will buy and sell according to your own wishes. Successful people can be unaffected by emotions in business. "Although hope is a virtue in other areas of life, it will become a real obstacle in stock trading." When a novice wants the market to be favorable to him, he often violates the basic trading rules.
5. Have a proper rest time:
Buying and selling every day dulls judgment. Take a break and you will have a more detached view of the market; It will also help you to look at yourself and your next goal with another mentality, and let you have a better eye to observe many factors in the market. 6. Profitable contracts cannot be easily closed, so profits should be sustained: selling profitable contracts may be one of the reasons for the failure of stock investment. The slogan "As long as you make money, you won't go bankrupt" does not apply to stock investment. The reason is: if you can't keep your profits growing, your losses will exceed your profits and crush you. Successful traders say that you can't close your position just for profit; To end a profitable contract, you must have a reason.
7. Learn to love loss:
"Learn to love loss, because it is part of the business. If you can accept the loss without hurting your vitality, then you are on the road to success in stock investment. " Before you become a good trader, you must get rid of the fear of losing money.
8. Avoid going in and out at market prices:
Successful traders believe that buying and selling at market prices is a lack of self-discipline. Unless you want to close your position before buying and selling at the market price, you should move towards the goal of not using market orders as much as possible.
9. The most active contract month in the trading market:
Doing business in active months can make trading easier.
10. If you have a good chance of winning, enter the market again:
You should look for opportunities that are "less likely to be lost and more likely to be gained". For example, when the price of a stock is close to its recent historical low, the possibility of its rebound may be greater than its decline.
Although the items I mentioned are simple, most investors can't do them. If you want to survive in the stock market for a long time, you don't have the above ability. Please leave the stock market as soon as possible, so you will lose less.