However, there are still many traders who don't make double quotes in the right way, or even don't know what double quotes are. After all, I have never seen any trader make a long-term profit (here I think the long-term profit is more than five years) when his trading system fails to pass the double quotation verification. Here I'd like to share my views on the resumption, including some ideas and operation methods. Here, I put forward the important idea of "one purpose, two concepts and three steps", so that everyone can better understand and better implement the re-entry according to this guiding ideology.
A purpose
First of all, we should understand what the resumption of classes is for. Through the resumption of trading, we can improve our familiarity and grasp ability with a certain market or the entry and exit signals set by ourselves, so that our account will have less unnecessary losses and more profits that should have been caught. This is the important purpose of the whole resumption and the final result we want to achieve.
Two concepts
1. The price has been following certain rules for a period of time, which is also the premise of technical analysis. Livermore knew whether the price was going up or down when he saw the price trend. Although the rise and fall of prices are influenced by more factors now, there are still many people who make profits for a long time through technical analysis, which shows that the price trend is certain. Re-quotation is to apply the law of price obedience for your own benefit.
2. The trading system used for re-trading must be scientific and reasonable. Indicators and even the K-line itself only contain a small part of information, especially the indicators and K-lines that have passed. We should not be too superstitious, especially when there was no combination of quantity and price at that time. K-line itself only shows the highest price, lowest price, opening price and closing price. If traders only look at the K-line, the information they can get can only be obtained through these four prices. However, even a long positive line may not necessarily mean anything. Let's take a long Yang line as an example. Many people think that a positive line represents a high price, a strong upward momentum and a lot of bills. If you just look at the K line, there is no problem. However, in the case of opening on Monday, closing on Friday, holidays and even major news and data release, the market liquidity is often seriously insufficient, and the usual trading volume is very small. At this time, its impact will be amplified, which is equivalent to a huge amount.
I still use an example to make an analogy. The cruise ship on the water is so big and heavy that it is impossible for one person to push a cruise ship. However, a canoe-sized boat is easily pushed by people because of its small weight. In the market, liquidity is equivalent to the weight of the ship, and that money is equivalent to that person. The higher the market liquidity, the more difficult it is for this fund to affect the market price trend. If the liquidity is low, the fund will easily affect the price. Therefore, if you only look at the K-line itself, if you encounter this situation, you will think that it has risen sharply and started to rise. Who knows that the Yangxian line will slowly decline or even plummet, but if you cooperate with the volume at that time, you will know how the K line was pushed up.
In the stock and futures markets, you can check the order volume and trading volume at that time. Because there is no central settlement system in the spot market, there is no overall trading volume in the market. Some brokers or platforms can refer to the trading volume in their platforms, but even if the trading volume of a broker or institution is large, it may be different from the trading volume of the overall market. Pay attention to this. If it is a spot market resumption, some indicators are said to be volume indicators, but that is calculated according to the opening price, closing price, highest price and lowest price of the K-line itself, not the real volume. If this indicator is used in the trading system of the duplicate, you should pay attention.
I used more pen and ink to write this point, because if I don't understand this aspect, then the trading system it established will not conform to the market rules, which will reduce its effectiveness.
Three steps
1. Make sure the trading targets, indicators, parameters, or K-line forms, import and export signals and the like of your own resumption before the resumption. Only by confirming these, can we resume the offer if we have certain conditions, otherwise we will be fooling around and wasting time and energy thinking that we have resumed the offer.
2. In the process of resumption of trading, we must fully implement the trading strategy formulated before the resumption of trading, enter the market as soon as possible, and do nothing that should not be done. In addition, in the process of resumption of trading, it would be better to add the market news at that time. For example, there will be data release and leaders' speeches, and the disk will change immediately. Then at this time, there will be signals in and out because of these messages. If you don't take them into account when you don't resume trading, it's likely that this resumption trading is of little significance, because your trading strategy itself needs to be far away from the news market, or there is another way to quote in the news market, but you don't know it at this time.
3. After the resumption, we should have a general conclusion about the overall result of the resumption. We don't know whether it is enough to make money or lose money, but make a summary of each transaction in the resumption, such as whether to operate according to the rules, whether the parameters or access conditions can be improved in this case, and whether the improved results meet the improvement expectations. Look at the overall results after improvement, such as the maximum loss of the account, continuous loss, capital curve, profit coefficient and winning rate. Even if you just enter and exit in a simple double-top and double-bottom form, you can even optimize it repeatedly through re-listing, with less unnecessary losses and more profits that you should have caught.