Forex multi-account manager Z-X-N
Accepts global forex account operation, investment, and trading
Assists family office investment and autonomous management
In foreign exchange investment and trading, price behavior analysis, especially nake candlestick trading and Pinbar strategy, may not have as remarkable practical effects as advertised.
Although candlestick charts are praised as "the most expensive artworks" for their unique visual presentation, in the actual trading process, their role may not be as strongly attractive as their appearance. For N-shaped patterns, whether standard or extended, their practical utility may be overestimated. In N-shaped patterns, the only thing that may have certain value is setting trading orders by using previous highs and lows, but this is not the entire connotation of candlestick analysis.
In addition, another function of candlestick charts in foreign exchange investment and trading is to assess market strength and weakness, mainly achieved by observing the length and direction of shadows. However, when the candlestick intervals are too dense, the information value they provide will be greatly reduced. Excessive attention to the details of a single candlestick is like counting the hairs of a cow or studying a single leaf in a forest, which is very likely to distract traders and then lead to confusion in thinking. This phenomenon is somewhat similar to the field of education. Sometimes, excessive learning can instead make thinking become rigid and dogmatic.
There are a large number of books on candlestick analysis on the market, but this does not mean that every one is worth spending time studying. Even the most experienced traders are well aware that risk management is a crucial part of foreign exchange investment and trading. Publishing books entails almost no risk, and novice traders often find it difficult to distinguish which contents have practical value. As trading experience accumulates, even the least sensitive foreign exchange investment traders will gradually recognize the limitations of the practical utility of some analysis methods.
In foreign exchange investment and trading, one should not rely solely on candlestick charts. Combining other technical indicators such as moving averages to assess trading trends may provide more comprehensive and reliable information.
In foreign exchange investment transactions, when operating with a light position on the left side of a long-term investment, it is possible to go against the trend appropriately. When operating with a heavy position on the right side of a short-term investment, it is essential to follow the trend.
For long-term light position operations in foreign exchange investment, leverage tools must not be used. The reason is that long-term transactions have a relatively long time period. During this period, there is greater market uncertainty. Once leverage is employed, the risk will increase significantly. If there are adverse fluctuations in the foreign exchange investment market, it is highly likely to lead to serious losses. In this case, for long-term foreign exchange transactions, one can consider gradually building positions through left-side trading. Left-side trading means making an early layout based on analysis and judgment of the market when the trend is not completely clear. Although there is a certain risk, when the analysis is accurate, positions can be established at a relatively low cost, laying the foundation for future returns.
In heavy position short-term transactions of foreign exchange investment, the contrarian method must not be used resolutely. Short-term transactions have a short time period. The market changes rapidly and fluctuates intensely. Contrarian operations are easily impacted by the rapidly changing market conditions and face extremely high risks. Short-term foreign exchange transactions should only build positions through right-side trading. Right-side trading is to start operations after the trend is clearly manifested, which can reduce uncertainty to a certain extent. When there are obvious upward or downward trend signals in the market, building positions in line with the trend can better grasp short-term trading opportunities. For heavy position short-term transactions, due to the heavier position, the risk is correspondingly higher. Therefore, the judgment of the trend and the grasp of timing need to be more accurate. At the same time, strict stop-loss and take-profit points must be set so that when there are adverse changes in the market, stop-loss can be implemented in time and profits can be locked in to avoid serious losses caused by a single wrong operation. Only in this way can we fully utilize the advantages of right-side trading in challenging short-term transactions and improve the transaction success rate and profit possibility.
In gold and currency trading, using a breakout strategy to achieve profitability seems relatively easy in theory, but extreme caution must be maintained in the actual operation process.
The possibility of a breakout in the gold market is usually higher. The main reason is that a large number of investors around the world participate in it, and the trading volume is extremely huge, which makes the authenticity of the breakout at a relatively high level. In comparison, the number of participants in the currency market is relatively small, and it is also affected by the regulation of central banks, and its trading volume is relatively small.
It needs to be emphasized that the above analysis is only a speculative view. Therefore, investors who plan to adopt a breakout strategy should maintain a cautious attitude. A breakout in the currency market may be triggered by the intervention of central banks. According to the mean reversion theory, prices may quickly pull back. On the other hand, if a breakout in the currency market is driven by economic data or political events and there is no intervention by central banks, then this breakout may not be affected by human factors.
In the current foreign exchange investment market environment, the breakout trading strategy has certain feasibility.
When the price breaks through key support or resistance levels and enters the market, traders can obtain profits by leveraging market momentum. Naked candlestick breakouts can provide a more rapid entry signal because they do not rely on any indicators and directly reflect price behavior. In a rapidly changing market, speed is usually a crucial factor.
However, the space for breakout trading in foreign exchange investment may be relatively limited. Therefore, focusing on identifying false breakouts may reveal more real breakout opportunities. In a market with a smooth trend, breakout trading is particularly effective. There is a gradually accelerating breakout pattern, which may indicate that the market is accumulating momentum.
Fluctuations in the foreign exchange investment market can be divided into two types: wide fluctuations and narrow fluctuations. Wide fluctuations may mean that the market is active but there are large differences. Narrow fluctuations may indicate that market trading is inactive and there are relatively small differences. The speed of fluctuation reflects the size of order flow. Rapid fluctuations usually mean that there is a large amount of orders flowing, while slow fluctuations may indicate a smaller order flow. Prices usually move in the direction of least resistance, which is a principle generally recognized by market participants.
In the oscillation range after the end of the foreign exchange investment trend, the foreign exchange market often presents a state of wide fluctuations, including V-shaped reversals. To form a new trend, fluctuations in the foreign exchange investment market may gradually narrow, forming a convergent form or a narrowed state of parallel intervals. The formation of foreign exchange investment trends is often the result of reduced market differences, reduced reverse amplitudes, and shortened lateral time. On the contrary, the end of foreign exchange trends is usually accompanied by an expansion of reverse amplitudes and an extension of lateral time, eventually leading to market stagnation and entering a state of large oscillations.
The challenges currently faced by the foreign exchange investment market include the high-speed circulation of information, making it difficult to distinguish true and false news, and investors' doubts about the authenticity of data. For example, concerns about the possible existence of falsified economic data in dollar-denominated countries make it difficult for investors to establish confidence in long-term holdings.
In the field of foreign exchange trading, the continuity of market dynamics is generally rather limited. It usually appears rapidly in an extremely short period of time and then quickly returns to a fluctuating state.
This rapid change is often closely related to political stability and is particularly significantly influenced by large market participants such as central banks. For investors with large amounts of capital, due to their huge capital volume, the market fluctuation risk they face is also relatively high, which may lead to psychological uneasiness and anxiety. To alleviate this situation, investors can consider giving up the use of leverage and instead choose carry trade, especially choosing high-interest currency pairs for carry operations.
Price fluctuations of currency pairs often occur within a short period of time, and most of the time they are in a relatively stable oscillating state. The effectiveness of trend-following strategies depends on the volatility of asset prices. However, the current foreign exchange market does not always have this kind of volatility. Therefore, investors may need to explore new methods beyond traditional trend-following strategies.
The fundamental characteristics of the foreign exchange market often make trends less obvious. Political turmoil may trigger violent fluctuations in the market. However, government agencies usually monitor the foreign exchange market and intervene when necessary to stabilize the market. Despite these challenges, the foreign exchange market still attracts many investors, partly because it provides a high leverage ratio, providing investors with potential opportunities to amplify investment returns.
13711580480@139.com
+86 137 1158 0480
+86 137 1158 0480
+86 137 1158 0480
Mr. Zhang
China · Guangzhou
13711580480@139.com
+86 137 1158 0480
+86 137 1158 0480
+86 137 1158 0480
Mr. Zhang
China · Guangzhou