Logical closed loop: Any trading logic should form a closed loop. If you rely on technical indicators to enter the market, you should exit decisively when the indicators show a reversal signal, and you should not use fundamentals or market sentiment as an excuse. If you trade based on fundamentals, as long as the fundamental logic still holds, you should not be disturbed by technical analysis. Be sure to separate technical analysis from fundamental logic, and do not ignore obvious risks in order to maintain your own logic.
Be cautious when buying at the bottom: Buying at the bottom is very risky. Many people often mistakenly think that the price has reached the bottom when it is falling, but in fact it is only halfway up the mountain. If you have sufficient funds, you can reduce the risk by spreading the cost, but if funds are limited, it is recommended to avoid blindly buying at the bottom. The real and effective way to buy at the bottom is to take advantage of the callback in the upward trend, rather than to take over when the price continues to fall.
Beware of good news at high prices: Be especially careful when good news appears at high prices. Such good news is usually intended to attract retail investors to follow suit, and the main force may have already taken profits and exited the market in advance. If there are few followers, the main force may raise the price and induce more buying; but if there are too many followers, the main force may directly sell the stocks, causing the price to fall sharply.
Position management: Position management is crucial. It is recommended to divide positions into short-term and long-term operations, with short-term positions accounting for 30%, long-term positions accounting for 30%, and the remaining positions for swing trading. In this way, there will be enough positions to spread the cost when the market environment is unfavorable. Successful traders are usually able to flexibly respond to market changes through swing trading, rather than blindly chasing ups and downs.
Formulate and abide by trading principles: Establish your own trading principles and strictly enforce them. Market fluctuations can easily affect emotions, so you need to plan your position strategy in advance and clearly know when to exit and when to enter the market. When trading, you only need to focus on executing the established plan and not be disturbed by short-term market fluctuations.
Position control: The main difference between a novice and a mature investor is position control. Due to the uncertainty in the market, position control can help you reduce losses when faced with misjudgment. Reasonable position management can make you feel at ease in the market and avoid passively responding to emergencies. ➕👗➩BNB0098
Make and execute a trading plan: Make a detailed plan before trading and strictly execute it during trading. Don't let market fluctuations disrupt your trading plan. Combine with the market environment, participate in trading when it meets the conditions of the plan, and strictly avoid trading when it does not meet the conditions. It is better to miss an opportunity than to violate the established strategy.
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