1. Stop loss after the important technical support or resistance level is broken.
This is the most commonly used operation mode in actual combat. The proportion of investors who stop at this position is very high. However, a careful analysis of the domestic and international futures charts shows that in the futures market, the price trend often reverses after the resistance or support level is broken.
The important resistance or support positions are as follows: (1) the intensive transaction area where the price stays for a long time; High or low prices for a long time; The position provided by the technical methods of trend line, golden section or moving average system.
The main reasons for the lack of reliability in these locations are:
(1) Large speculative funds can predict the approximate stop-loss price of market investors. They even deliberately made a large number of transactions at some price points, forming the illusion of strong support or strong resistance, and then penetrated these positions with the advantage of capital, and made profits through reverse operation after the stop loss appeared.
(2) The position of support or resistance provided by trend line, moving average system and golden section is subjective, lacking reliable basis and foundation, with low accuracy. Setting stop-loss points in these positions is like waiting for death.
2. Stop loss after the absolute loss amount reaches.
At present, this is the stop loss method adopted by many day traders. The key point of its operation is that the maximum loss of funds for setting up entry points is generally 5%-20% of the occupied funds, or it can be the absolute amount of occupied funds, such as 100 yuan per lot. Once the loss amount is reached, stop the loss immediately, regardless of the price.
Using this stop loss method, we must pay attention to the following two points:
(1) Different varieties or different operation periods should adopt different stop-loss quotas.
(2) The established stop loss limit must be verified by probability in the market.
The advantages of this stop loss method are obvious:
(1) highlights the principle of fund management. Foreign experience shows that a good trader is not how to analyze the market, but how to manage the funds.
(2) It has a probability advantage, and the longer the operation time, the more obvious the advantage.
(3) The stop-loss position is far away from ordinary investors, thus preventing the market risk brought by the first stop-loss position setting.
When using this stop loss method, you need to do a lot of statistics and analysis, determine the operation strategy, and find the best stop loss amount suitable for your own operation style.
3. Stop loss when you reach your limit.
This stop loss method is often used by novices. The author's experience is that using this stop loss method in short-term operation is still helpful to improve the yield. In fact, some excellent foreign traders often use this method.
The specific method of use is: when your position loses money, as long as you can bear it, you can hold the position, otherwise stop immediately, even if it is a newly established position.
The author believes that this method is suitable for short-term electronic transactions, but also for experienced traders in the market, while novices often shake out at high and low levels when using it.
The main basis for using this method is that if you "feel" uncomfortable after opening a position, it is often because of unexpected situations in the market. Although you may not have time to analyze too much information because of short-term trading, or you may not know it for the time being for other reasons, long-term trading makes you "feel" the risk of the market, so you should leave the market immediately and wait and see.