The difference between professional traders and amateur traders
1. Heavy positions, small funds can only double quickly through heavy positions. Some amateur traders have been trading for more than ten years without ever doubling their capital. This is definitely a problem with their trading system, as the market is linear. There is only a sudden big market movement after a period of time; the rest are sideways movements. There is roughly one opportunity for heavy positions each week. If you catch it, you can quickly double your capital within a month.
2. Holding positions, most people are afraid to hold positions for a long time, especially profitable ones. The correct method should be to hold profitable positions longer than losing ones. Amateur traders find it difficult to hold positions due to poor risk management, often checking charts at night. In fact, you should only invest with a safety cushion, and if you achieve a profit of over 20%, you can try holding overnight positions, which allows for passive income.
3. Cycles, many people are unwilling to trade based on daily charts, let alone weekly charts, thinking it’s too slow. They prefer to look at 5-minute, 3-minute, or even 1-minute charts. What I want to say is that even if you are day trading, you should also look at weekly and daily charts because the main forces are contesting on these timeframes. I determine trends based on weekly charts, look for direction on daily charts, and enter and exit on 15-minute charts. This way, you can become aligned with large capital. After all this, have you learned anything?
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