Method 1: Find important resistance or support bands.

Support and resistance levels are very important price ranges and have very important reference value both in entry and exit. The trading strategy derived based on this can be summarized as "breakout trading strategy".

To put it simply, if the price strongly breaks through the resistance or support level, the trend will continue to move in the direction of the breakthrough with a high probability. On the other hand, if the resistance or support level is repeatedly tested without breaking through, the price trend may reverse.

Method 2, use the divergence of oscillators.

The so-called divergence means that the trend established by the price is opposite to the trend shown by the oscillator. For example, the high point of the price is getting higher and higher, while the high point of the oscillator such as MACD is getting lower and lower. When a divergence occurs, it indicates that the price will most likely reverse in the near future. From this, you can judge whether the trend you think is reasonable and whether it is worth continuing to trade. At the same time, you can also be prepared for a market reversal. When a more mature trading signal appears, it will be the opportunity to enter the market.

What needs to be emphasized here is that the divergence may last for a period of time and does not reverse immediately when the divergence occurs. Therefore, this method should be used to assist in judging the continuation and reversal of the trend and as a basis for increasing the winning rate.

Method three, wait for a breakthrough near the channel.

This method is similar to the first one and both belong to the type of breakout trading. It’s just that judging channels is much more complicated than judging resistance and support, and various channels often overlap.

Common channels include: parallel intervals and convergence triangles. You can also make comprehensive judgments using the technical indicators of the "Paulica Channel".

The basis and method of trading are similar to the first method, but two points need to be noted:

1. When using parallel intervals for swing trading, you need to always be wary of breakthroughs and interval failures. There will always be a day when the interval expires, and it should be judged in conjunction with other indicators;

2. The biggest risk in breakthrough trading is false breakthroughs, so in operation, you can place a small order first and then increase the position, or wait for a clearer decision Place an order when a trading signal appears.

Method 4, use the overbought and oversold indicators.

The so-called overbought and oversold means that the unilateral trend within a certain period of time is relatively obvious, exceeding the current long and short level of the market, and may be reversed in the future. In terms of technical indicators, it is reflected as too high or too low values. For example, the overbought and oversold ranges of RSI are above 70 and below 30 respectively, and KDJ is above 80 and below 20. When establishing an entry strategy, you can use whether the price enters the overbought or oversold range as a reference.

It should be pointed out that when overbought and oversold signals appear, it does not mean that the price will reverse immediately. It also needs to be combined with other analysis and comprehensive judgment. In addition, overbought and oversold are often used in short-term trading. The occurrence of trading signals does not necessarily conform to the overall trend of the medium and long-term, so they must be used according to their own trading characteristics.