KCM Trade teaches you the correct way to open short-term band trading

day tradingIt refers to buying and selling trades in a relatively short period of time in pursuit of quick profits. Short-term traders usually hold positions for a shorter period of time, usually a few minutes to a few days. They mainly focus on short-term fluctuations and trends in the market and try to make profits on these fluctuations.

The goal of short-term trading is to make small profits in a short period of time. Traders may make multiple trades to accumulate profits. They usually set stop-loss levels to control risk and set profit targets to exit the trade when a certain profit is reached.

Short-term traders typically use a variety of technical analysis tools and indicators to analyze the market and develop trading strategies based on market trends and fluctuations. They may use technical indicators such as chart patterns, moving averages, relative strength indicators to identify turning points and opportunities in the market. They typically focus more on short-term price movements and volume rather than long-term fundamentals.

Short-term trading requires traders to have the ability to make quick decisions and execute, as well as the ability to observe the market keenly and accurately predict. This type of trading is risky and requires traders to have extensive experience and skills.

There are many people who have come into contact with investors, and they have found such a phenomenon. Many people are particularly fond of short-term operations, the shorter the better, and they enjoy it every day. Although there are also experts, most of the trading stars we see are in the medium and long term.

As a result, the theory that short-term trading requires talent and it is difficult to become a talent is rampant, but most of them are blind and conceited, "The short-term trading method itself is fine, it is a problem of his ability that he can't do it well, and it does not mean that I can't do it well." Therefore, there are still many people who are still clinging to the short-term. Of course, traders like this situation, and exchanges are grateful to them for providing a lot of liquidity, but for these short-term customers, is it correct to be so persistent?

With a lot of likes to doshort termI have talked to some people, and I have analyzed two reasons why they are so insistent on short-term:

First, if the capital scale is large, even if the long-term yield is not high, the absolute return is also very objective, but short-term customers generally have a small capital scale, and the absolute return corresponding to the long-term yield is too low. They expect higher returns, so they need more operations. It is best to eat every stage of the market that is still smooth.

For example, there would occasionally be a dozen or so consecutive male lines on the K-line during the day, which looked very tempting. This opportunity was not to be missed. If this effect could be achieved, it would not be a problem to double it 10 times a year.

The second is: short-term trading is efficient, whether it is to make money or lose money, you can quickly give a result, unlike long-term, holding a position for several weeks, the capital fluctuates up and down, when you lose money, you look forward to returning the money, when you float, you are worried about retracement, you are uneasy, and you can't sleep well, which is really uncomfortable. Short-term is different, you will give results soon, don't worry so much, this is physiologically in line with the immediate needs of the human brain.

Both of these reasons sound reasonable, but upon closer inspection, they are not.

The first reason was a typical blind eye. He only saw the smooth market he wanted to see, but when he really started to do it, he often encountered those unsmooth market conditions, which caused great losses.

There is a story about a man who lost his ring while walking at night, and then went back to look for it. As a result, the person next to him found that he was only looking under the street lamp and asked him, "Why are you only looking under the lamp?" He said, "How can I find it where there is no light?" The person simply forgot his true purpose, which was the ring, not the act of "looking".

A person who is obsessed with doing short-term business during the day only wants to participate in the smooth market, but in fact, the smooth market is like a street lamp on the road. The range of illumination is very small, and most areas are still black. To find a ring, you must look for it from the whole road, not just under the lamp.

For the analysis of the second reason, let's look at an experiment on delayed gratification. This is an experiment conducted by developmental psychologists. The experimenters gathered some children and distributed them some candy, and then told them: If you eat it now, you can only eat one, and if you eat it again in 20 minutes, you can eat two candies. Some children couldn't resist the temptation and chose to eat the candy when they got it; while others were able to resist the temptation and ate two candies. In subsequent follow-up surveys, the experimenters found that children who could resist the temptation and ate two candies tended to have better academic performance and were more likely to succeed in their careers or jobs.

One can imagine how unbearable it is for a child to hold a sweet candy but not put it in his mouth, just like we bear the pain of holding a position. But what we want must be two candies, not just one.