Foreign exchange investment: How to make short-term technical adjustments?

foreign exchange marketIn the middle, no matter how sharp the upward trend is, it is impossible to rush to the top in one go, and no matter how tragic the downward trend is, it is difficult to fall in a straight line to the end. In the middle, it must go through consolidation. Only after consolidation can a new wave of ups or downs be launched. This consolidation is termed technical adjustment. Technical adjustment is caused by three forces: first, some traders with floating profits make profit position squaring, and technical buying or selling makes the market under pressure in the opposite direction; second, some traders with floating losses adopt average price tactics, adding dead yards, making the trend zigzag; third, some people feel that "this wave is almost the same" and implement short-term attacks, which also impact the price.

Technical adjustments provide us with a short-term opportunity. Usually, such an adjustment is equal to 30% to 50% of the increase or decrease in the previous period. It can be grasped and the profit is considerable.

The appearance of technical adjustments is also a signal to be found. For example, in an uptrend, a red line is drawn for three consecutive days, but one is shorter than the other, and the increase is decreasing day by day; or after several days of rising, a high opening and low closing is drawn, and a black line with an upper shadow is drawn. These moves are signals that the uptrend is about to adjust. Conversely, in a downtrend, a black line is drawn for three consecutive days, but one is shorter than the other, and the decline is decreasing day by day; or after many days of falling, a low opening and high closing is drawn, and a red line with a lower shadow is pulled, which are all signs that the downtrend is about to rebound. Take advantage of the uptrend to be short when there is an adjustment, or take advantage of the downtrend to be long when there is a rebound, which is in line with the principle of going with the market. Even if the previous stage has seized the opportunity to rise or fall, and then takes advantage of the adjustment to sell or buy, then you can really achieve the ideal state of "picking both watermelon and sesame seeds".

The use of technical adjustments for trading can only do short-term, absolutely not too greedy, under normal circumstances, the adjustment of up to 50% of the range, when it is over. Because even the "average price tactics" of the user, to this price, roughly the game, they will quickly position squaring you too greedy, the market turned back to the general direction, it became "greedy sesame seeds and throw watermelon".

No matter whether it is a technical adjustment in the process of rising or falling, it does not mean a change in the general direction. When the adjustment occurs, the fundamentals of the market have not changed, the market sentiment has not changed strategically, and the chart trend has not changed as a whole, so the adjustment is temporary. The fist is withdrawn to fight forward more forcefully. This is what we should clearly remember when we use technical adjustments to do short-term operations.