The psychological transition between market periods includes Trend and Sideway
Market characteristics, trading strategies and trading psychology need to be applied in each market period
1. Trending phase (trending)
- Market characteristics: All indicators and time frames agree. Strong buying and selling forces. The trading system (indicators) produces very clear and accurate results. Trading theories have very high win rates
- Tactic:
For uptrend: Only Buy/Long and wait for the correction to finish to buy/long
For downtrend: Only Sell/Short and wait for the correction to complete to Sell/Short
Absolutely do not fight against the trend. If you miss a wave during the trending period, you must wait for a correction before entering an order
When should we close all orders? Close the order when the smaller time frames run out of bullish/bearish power. For example, close orders on wave D1 when the time frames are smaller than H4 and H1
- Trading psychology applied during the trending period:
Increase expectations, reduce fear (Prioritize attack)
The market has the ability to train traders' psychology, making traders familiar with the previous sideway amplitude period, so if the price only goes up a little bit, they will close the wave, leading to a short closing of the wave -> but because of the short closing, it will create psychology. Reasons for regret can easily push traders into Fomo
The psychology of the majority is always out of phase with the nature of the market.
Absolutely comply with trading system theory at this stage (100% compliance with wave nature)
(continued next: Sideway phase)
