Anti-set strategy before foreign exchange speculation

foreign exchange marketAffected by various factors, there have been ebb and flow, and some unpredictable sudden news on the Q & A website often stimulate the exchange rate to fluctuate violently, which is beyond people's expectations and makes investors face a stuck situation. Almost everyone in the foreign exchange market has the experience of being stuck. Stuck is a difficult problem. What should I do after being stuck? The author has always believed that instead of racking my brain to find a way to solve the trap after being stuck, it is better to prepare strategies to deal with various situations before being stuck, or before placing an order. This operation is much more proactive, even if it is stuck, it will not panic, and it is much more peaceful to face the calm attitude.

In practice, many people are easily influenced by market sentiment. When the market rises rapidly, they cannot withstand the temptation of profits. Without careful and objective analysis, they blindly follow the trend and chase the rise. The skyrocketing market often becomes a long trap to lure impulsive investors to buy. In this way, nine times out of ten, the order will be stuck. The author believes that in the foreign exchange market, investors should pay attention to the following points in order to avoid getting stuck at high levels:

1. You cannot buy after a sharp rise, especially when you suddenly rise after a long rise.

2. You cannot buy after a long period of growth, especially after the announcement of major positive news that the market has long expected.

3. You cannot buy after a period of upward movement and a high volatility on the daily K-line.

4. You cannot buy after a period of increase in the daily K-line when the indicator deviates from the trend.

Face the above four market conditions calmly, control your emotions, develop the habit of independent thinking, and don't be influenced by the optimistic atmosphere of the market. Don't be persuaded by friends around you.

We are not immortals. No matter how good you are at avoiding risks or analyzing operations, as long as you buy and sell in the foreign exchange market, you will encounter many unpredictable unexpected factors, and quilts are inevitable. Once the quilt is quilted, how to get rid of it and how to turn defeat into victory becomes the biggest wish of the trapped person. The author recommends:

1. Don't be afraid of making mistakes, just be afraid of procrastination. It is unavoidable to make mistakes in investing in the foreign exchange market. After entering the market to buy a currency that is stuck, there is no need to panic first. Calmly analyze whether the exchange rate you bought belongs to the historical high level, the middle level, or the bottom area. When you find that the exchange rate you bought is at a high price that has risen for a long time, you should promptly and decisively accept compensation and sell it to reduce losses. This will not only reduce your losses in the future market, but also adjust your mentality and funds, and then take the initiative. Speculative markets are not afraid of making mistakes. They are afraid that they will not admit their mistakes and delay waiting for the exchange rate to rise. As a result, the exchange rate will fall more and more, and the losses will increase.

2. In practice, many Huimin friends know that they must decisively admit compensation and leave the market at a high level to avoid greater downside risks, but how to formulate a stop loss level? To determine the stop loss level, there are the following positions worth referring to: the exchange rate where the exchange rate falls below the 5-day moving average; the exchange rate falls below the lower limit of the pre-finishing platform; the exchange rate falls below the triangle bottom edge formed by the previous shock convergence. The stop loss level can be set at the position of the 5-day moving average, or the position of the finishing platform and the bottom edge of the triangle. Setting up a stop loss level is indeed a difficult technical problem. Generally, you can also mechanically formulate your own acceptance rate. If you formulate a drop of 30 points or 50 points, you will decisively position squaring and leave the market. If you want to survive in the foreign exchange market for a long time, you must learn to stop losses in time and turn long pains into short pains. Long-term precipitation of funds will definitely affect the appreciation of funds. Especially when buying at a relatively high position, you must set up a stop loss. Once the judgment is wrong, you must stop the loss in time. This is the most effective way to deal with high levels.

3. Stop the loss at the high level and sell the currency, you should wait patiently. Since you sell at the high level, the exchange rate will have a period of falling space and time. At this time, investors should restrain their impatience to "make back their money" and wait patiently for the next opportunity to enter the market. In fact, after selling the currency at the high level, the more the currency falls, the more beneficial it is for investors who sell the currency. When the decline is large, you can buy the currency again with the funds that were previously withdrawn from the market. Since the exchange rate is relatively low, you can buy more quantities. Once the currency rises slightly, you can quickly make up for the original loss. If the currency rises sharply, it will naturally turn defeat into victory.

4. High stop loss is of course an effective way to avoid greater losses. In addition, it is also a very good way to achieve quick unwinding through cross-trading hype. After judgment, if the market conditions permit, put the quilt's currency through the cross-trading, and cross-buy the better-performing currency to achieve the purpose of exchanging weakness for strength. If the strong currency rises, it can be unwound, and even possible to make a profit. Investors can save transaction costs by cross-trading without necessarily first positioning squaring back to the US dollar. After all, the bid-ask spread of real trading is still quite large. Through cross-trading, it is actually to combine two transactions into one transaction, which will of course save transaction costs. When quilt again in the future, you can first take a look to see if there is a good crossover that can be done. After analysis, if not, consider a straight stop decisively.