Trading Wisdom

Warnings in the Face of Continuous Losses

When the cumulative losses reach the 10% warning line, it is important to deeply analyze the root causes of the losses and quickly adjust the strategy. Continuous losses should not be ignored. They are important signals sent to us by the market, and we need to respond in time and make adaptive changes.

The prudent principle of short-term trading

In short-term operations, uncertainty is the norm. If you feel vague or lack confidence in the market trend, the best strategy is to wait and see. Blind trading is often accompanied by high risks, especially in periods of unclear judgment, you should act more cautiously to avoid unnecessary losses.

Avoid the trap of chasing high prices

Faced with a target whose stock price has soared by more than 50%, we should stay sober and be alert that this is a trap for the market to lure more. At this time, chasing the rise may fall into the dilemma of being stuck at a high position. Rational analysis and avoiding impulse are the key to protecting the safety of funds.

Calm judgment of high-level volume

After the stock has risen continuously, if there is a large volume at a high level, this is often a signal that the main force of the market is inducing more shipments. At this time, controlling emotions, staying calm, and avoiding being swayed by market sentiment are the performance of mature investors.

Flexible response to market strengths and weaknesses

In a weak market, we should look for opportunities to buy low and wait patiently for the market to rebound; in a strong market, we need to buy decisively during a pullback to capture the rising band. Flexibly adjusting strategies according to market conditions is the key to successful trading.

Caution in adding positions and wisdom in building positions in batches

Before adding positions, make sure you have a full understanding and grasp of the market situation. If you are not more than 90% sure, you would rather miss the opportunity than add positions easily. At the same time, the method of building positions in batches at low levels can effectively reduce risks and increase the flexibility of capital use. In this way, even if the market fluctuates, you can maintain a relatively stable position.