There are many people who open an account with XM and do not know how to win even if they start trading. Therefore, I am writing an article on how to win in discretionary trading. This time it is an article about the rebound point from buy to sell and sell to buy.
Secrets of trade
There are two secrets of trading.
go with the flow
The important part of trading is not to go against the big flow. This is important whether it is a short-term trade or a long-term trade. Before trading, please check the daily and weekly flow. If it’s pointing up, it’s buying, and if it’s pointing down, it’s selling. This will tell you if you are winning by buying or by selling.
rebound point
In trading, capturing the repulsion point is the greatest mystery. It is important to capture the turning point from buying to selling and selling to buying below. If you can understand this, you will be able to win not only in exchange but also in virtual currency and stocks.
Repulsion point entry method
In order to find the repulsion point, it is necessary to look for the following points. When you find it, buy or sell and play.
find where you’re having trouble
Take a close look at the part circled in red below. Buying and selling have been raging for dozens of hours. Buy or sell when this range is reached. In this case, it is better to compete by selling because there is a dispute when it comes up.
entry before moving
Let’s enter properly when there is a dispute between buy to sell and sell to buy. It’s already too late to enter after the big move. The most price range you can aim for is the initial move when the trend comes out. Because the first move can take the largest price range, and it is easy to win. On the contrary, after a big move, you may not be able to aim for the price range anymore.
if you go the other way
Of course, no investment is 100%. Sometimes it goes the other way around. In that case, it is necessary to cut the loss when the latest highest price or lowest price is jumped. If the direction is out, it will move greatly, so if you leave it alone, you will lose a lot. Don’t put up with it badly, cut your losses properly.
Notes on trading
Please pay attention to the following points when entering.
Set profit and stop loss points
Let’s enter after deciding the profit taking and loss cut line in advance. Perhaps there are people who have thought that “If you keep holding it as it is, you may not lose money”. In some cases, the unrealized loss may actually disappear, but in other cases, the loss may increase. It would be nice if luckily there would be no losses, but FX trading does not go so well. The reverse is also true. I thought maybe I could make more money, so I left it alone and it all came back.
risk reward
Professional traders often have a risk-reward ratio of 1:2 or 1:3 or higher. You should definitely aim for a place where the reward is greater than the risk. Failure to do so will result in a negative outcome. Also, if the endurance range is shortened too much, it will only be a loss cut this time, and it will become a so-called loss cut poverty. The amount of loss cut per time is very small, but if it accumulates, it will become a big loss. Appropriate tolerance is also required.
wait till you calm down when you come back
Even though I entered once and made a big order, the return is too tight and I may come back all. In that case, it is better to drop the position once before it turns negative. Once there is a strong pullback, you should wait until the pullback stops and the buying and selling scrambles again. The reason is that it can go backwards and go backwards at once.
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