Short-term small-band trading strategy and key points of mentality control
In the short-term small-band trading situation, if you are always overly worried about the risk of falling, you will often rush to take profit too early. Once you see the price continue to rise after taking profit, you will easily fall into anxiety. At this time, you must remain calm and follow the following points:
1. Entry strategy
If you have the time conditions to watch the market in real time, you should look for low-point entry within the range formed by the intraday lowest point and the historical highest point to carry out ultra-short and quick-win transactions. Specifically, it is to explore short-term long entry opportunities on the lower track of the 1-hour chart and the middle and lower tracks of the 4-hour chart.
If you think this operation is cumbersome and complicated, you can directly wait for the next low-long entry opportunity of the next band.
It is most appropriate to operate 1-2 orders per day, because new low-long trading opportunities will emerge every 12 hours. If the frequency of entry is too high, it is necessary to make a quick decision, because this transaction is carried out within the range of the lowest and highest points of the day, the amplitude is relatively limited, and the profit is also limited. Once the price leaves this range, it is very likely to fall into the dilemma of being trapped.
2. Stop profit and retain tail position strategy
When the market is in a state of sideways fluctuation or slow decline, that is, when it is not in a continuous downward trend, for low long orders, we should gradually develop a good habit of taking profits in batches and retaining tail positions.
Under normal circumstances, this tail position can retain 10-15% of the position;
If the market performance is excellent, after each small band reaches the stop profit target, the tail position can be retained 20%.
The purpose of retaining the tail position is to prevent the price from continuing to rise after exceeding the stop profit target, or to be able to chase high when it rebounds to a new high, so as to effectively avoid the market after the full profit is taken too early, or the embarrassing situation of being trapped for a short time due to direct current price rush.
In most conventional market conditions, as long as the tail of the market is replenished near the next support level, it will basically not have a significant impact on the average cost price, and it is easy to realize floating profits during the rebound.
In order to avoid the risk of continuous decline, it is necessary to set a capital-protecting stop loss in time for the tail of each band, and adopt a floating stop profit strategy.