Short term trading refers to the trading behavior where the holding time is less than or equal to 20 trading days. According to this standard, short-term trading can be further divided into two-day trading, weekly trading, and two-week trading.
The stock selection for two-day trading is highly speculative. When choosing this type of stock, the risk is much higher than in general stock trading.
Weekly trading is actually a correction of two-day trading, and in many cases people prefer to choose this method. Its advantage is that it can allow profits to grow more confidently.
The purpose of short-term trading is to maximize profit by fully utilizing capital efficiency. This is the fundamental purpose of short-term trading, because what we are engaged in is a long-term stock speculation rather than, or has never been, to win the company represented by this stock and share the profits that this company may bring.
The key to making profits from short-term trading lies in first judging the basic trend of the stock and the timing of the buyer's decision. If an established trend starts to rise and the time period is also in the bottom zone, then our short-term trading begins. At this point, we can temporarily leave the charts above the daily line and investigate the market clues revealed by short-term charts.
The risks of short-term operations mainly come from mistakes in short-term operations and the operator's excessive impatience and impulsiveness in mentality. When encountering short-term speculative opportunities, investors often rush into the fray without hesitation, and as a result, many short-term investors fall behind one after another. The short-term trading cycle is generally 1-3 days, with a maximum of 1 week; After more than a week, if it still doesn't work or even gets stuck, investors have to endure the pain of clearing their positions, because if they continue to delay, it won't be a short-term operation anymore.
Investors should not engage in excessive short-term trading, as it requires abundant information resources, timely timeliness, and accurate operations. In addition, it is required to have fast and accurate information processing methods and sufficient viewing time, and take corresponding measures to sell or buy at appropriate prices and timing. Meanwhile, computers, analysis software, and information receiving systems are essential equipment configurations. So, investors need to consider whether they have the above conditions before engaging in short-term operations. When investors engage in short-term trading, they should be aware that while short-term trading can lead to rapid profits, it may also result in rapid losses. Don't just want to see the sunshine and not witness the darkness, implement the "ostrich" policy.
When engaging in short-term trading, investors often pay special attention to the spread returns formed by short-term fluctuations in stock prices. Compared to the medium-term trend, short-term stock prices fluctuate up and down, full of unpredictable variables and easily influenced by accidental factors. This is usually related to the confidence and impulse of short-term investors entering the market, and more importantly, depends on the manipulation of the main force of the market makers, because the main force may actively break the equilibrium stalemate for some reason and strive to climb upwards or plummet downwards. Ordinary investors, due to their lack of information, lag far behind the evolution of the market in terms of information processing speed. By the time investors understand the driving force of the rise or the illusion of the fall, the stock price has already soared to the sky. At this point, if investors continue to bravely advance, their short-term value will be cut off by a large margin.
The risk control methods for short-term operations include:
1、 A market with high popularity is suitable for chasing up prices.
In a market atmosphere with active trading, there is a strong driving force for stock prices to rise, and the width of the oscillation amplitude is sufficient to provide a loose profit margin for short-term operations. For example, in a bull market, during the active period of individual stocks (as can be seen from trading volume) and market hotspots, investors' confidence increases and they dare to enter the market to chase higher prices. Fund holders also have the sentiment of being reluctant to sell and waiting for the stock to rise. At least in this way, the short-term selling pressure is greatly reduced, which is very suitable for chasing short-term gains.
2、 Light warehouse attack.
For short-term traders, taking a light position is always the right and correct choice. Short term light position means that chips cannot be bought in at once. The total amount of funds invested in the market can be set first, and then divided into several equal parts. After the first fund is drawn in, if the stock price drops by more than 4%, investors can use the same amount of funds to replenish the position and share the cost once. Remember, you can only make up for it once. The average cost of this stock price is only the first purchase price. When stocks continue to decline, it is important to be cautious in replenishing positions. The principle of adding positions in batches during price increases cannot be violated. The decline indicates that investors have misjudged the market and should take advantage of the rebound to sell. The price difference for replenishment should generally not be too small, otherwise replenishment is meaningless.
3、 Bidirectional short-term method.
It is best for investors to engage in short-term trading of their individual stocks, as this reduces the risk and allows for two-way short-term trading. If one day your stock suddenly rises and surges upwards, as long as you feel that the support for the stock price at a high level is not strong and there is no sufficient reason to continue to rise, you can level off some of your chips at a high level. As for how much is more appropriate to level off, it depends entirely on your evaluation and confidence in the strength of its decline. In theory, as long as the decline rate is greater than 2%, it is completely possible to allocate goods at a high position and wait for them to rise and turn around, and then easily buy equal amount chips. At this time, although the total number of stocks in hand remains unchanged, the remaining margin has increased significantly. Another scenario is that if a stock opens significantly lower on a certain day, or if the main force of the market deliberately hits the market, creating a bearish trend, short-term investors may use their remaining funds to pick up some cheap chips at a low price. When the stock price returns to its original level, they can then level off the same number of chips. Buy and sell, and if this continues, you can earn a considerable profit. This method is particularly suitable for retail investors, who can fully leverage the advantages of their funds and chips to make transactions at the highest and lowest points. The two-way short-term trading method allows for buying and selling on the same day, creating a disguised form of T+O.
4、 Fight a prepared battle.
Do not blindly and hastily seize sudden opportunities. Usually, not only should we care about the stocks in our hands, but we should also track and pay attention to some active stocks. Once there are signs of accelerated short-term gains or bearish traps created by market makers, investors can decisively take a lead and take advantage of the situation to profit. For short-term stocks recommended by stock friends or stock reviews, as well as stocks that investors have never done before, it is best for investors to think twice before acting. Suitable stocks and timing for short-term trading:
(1) Keep up with hot topics and lock in strong stocks.
Short term customers are a group of audiophiles who join in the fun and pursue fashion, always standing at the forefront of the trend. Hotspots are the focus of market attention, with strong popularity and a gathering of short-term customers. The short-term explosive force is strong, and trading is active. In terms of short-term entry and exit, the key point is to retreat bravely from the hot spot before it subsides, and abandon the crowd.
(2) Choose stocks that are about to break through.
The subsequent behavior of a breakthrough is generally to accelerate the rise or fall, which not only has a large space, but also can be profitable in a short period of time. But we need to prevent false breakthroughs. Investors' funds can be divided into two parts:
Part of them enter before the breakthrough confirmation;
Part of it intervenes after the breakthrough confirmation. The situations before the breakthrough generally include:
① Platform consolidation of strong stocks;
② Long term box shaped sorting, breaking through the top of the box in large quantities.
Box oscillation consolidation generally lasts for a long time, so investors can buy at the bottom of the box and sell at the top of the box during the first three oscillation processes to make a short difference. But after the third time, if the box is still in the middle of the upward trend in stock price and the market atmosphere is more cooperative, there is a high possibility that the stock price will break through the box top. Investors can closely monitor and pay close attention, and be prepared to do a short-term.
(3) Choose stocks with large oscillation amplitudes.
This type of stock should be T+O. Investors can use the 83 key on the Qianlong software to find a page with a large oscillation amplitude, buy a certain number of stocks in advance, or buy at a low level in advance, wait for the lower shadow to touch the absorption line, or fill in a sell order at a high level, and wait for the upper shadow to touch the high to close the position.
(4) Price increase chart.
Pay special attention to individual stocks with a growth rate greater than 5%. Before the opening of the market every day, investors should closely monitor the stocks with the highest gains based on the daily K-line chart. If the trading volume continues to increase and large purchases continue to be made, investors can boldly follow up with some of them; Those stocks that have already hit the limit up can wait until they open the limit up board before chasing them in moderation. Generally, stocks that hit the daily limit up will have a 4% inertia to rise the next day. Investors must place orders in advance the next day to prevent the loss of trading opportunities.
(5) The decline list.
To conduct a detailed analysis of individual stocks that have hit the limit down, it is necessary to determine whether the reason for their deep decline is due to the intentional suppression of stock prices by market makers, creating a bearish trap, or due to market manipulation leading to the limit down. At the same time, attention should be paid to the trading situation of individual stocks that have hit the limit down. Once there are signs of huge sell orders being opened, investors can immediately follow up, but the specific situation needs to be analyzed. It is necessary to catch up at the end of the confirmed breakthrough and when the overall trend is determined.
