As someone who started with 40,000 and reached 380,000 in the first year, and over a million in the second year, here are some experiences to share.
Perhaps this will be somewhat helpful.
There are generally 2 trading patterns:
1. High win rate, low profit-loss ratio, medium to high frequency.
2. Low win rate, high profit-loss ratio, medium to low frequency.
The first corresponds to intraday short-term or swing trading.
The second corresponds to mid to long-term trading.
Small capital cannot achieve mid to long-term trading. Even if mid to long-term trading can be profitable, it cannot achieve quick accumulation because of the large cycles, which limit opening positions. Unless luck strikes and a major market trend is captured, floating profits can be rolled over to grow larger. But such opportunities are rare, and even if caught, most people will exit midway due to the inability to endure floating profit drawdowns.
Therefore, to quickly grow small funds, one must only trade intraday shorts, although the mortality rate for intraday shorts is high.
First, correct some concepts:
Intraday short trading ≠ high frequency, ≠ holding positions all the time, the root cause of high mortality rate is not because of intraday short trading or transaction fees, but because of not following rules, not being able to quickly forget the pain of stop loss, and ignoring market risks after continuous profits.
The above is the theory of experience.
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The following are the operational experiences:
1. Go on a simulated trading or backtesting historical trading, create a trading strategy with a win rate of over 75% and a profit-loss ratio of 1:1 (can’t come up with it? Don’t worry, I’ll give a few to test and modify at the end).
2. Set rules: must cut losses when floating losses reach the stop loss line, no resistance for single trades, stop trading today after two consecutive losses. Don’t run at the first sign of floating profit, at least reach 1:1.
3. Capital management: position not exceeding 50%, increase position by 1 hand for every 2 hands profit, decrease position by 1 hand for every 2 hands loss.
4. Simulated trading and live trading orders must be reviewed and analyzed afterwards, at least for the live trading orders.
Eliminate the mentality of getting rich quickly and revenge, just accumulate little by little.
Here are a few intraday short strategies:
1 example:
Dual-period moving average system:
Taking short on S&P 500 (spx500) as an example:
First. 30 minutes for judging long and short cycles.
Green-red line in a bearish arrangement (green above, red below), for shorting environment.
Then. 5 minutes for entry cycle.
1. The previous K touches the red line, the following K closes bearish and the body breaks below the red line, short at the opening price of the third K.
2. The previous K touches the red line, and after n K stay above the red line, a K closes bearish and breaks below the red line, short at the opening price of the second K.
3. A single bearish K shadow line touches the red line, the body closes below the red line, short at the opening price of the next K.
Finally. Stop loss and take profit points:
1. Stop loss: previous high + 2 points.
2. Take profit: if the stop loss point exceeds 20 points, take profit 1:1; if the stop loss point is less than 20 points, fixed take profit of 20 points.
2 examples:
Moving average + breakthrough
A strategy mainly for intraday trading friends, win rate 75, profit-loss ratio 1.5-2, cycle 1min, mainly trading rebar, soybean oil, soda ash, glass, methanol.
Taking short as an example:
1. Three moving averages, MA5, MA13, MA21, three lines in a bearish arrangement.
2. Breakthrough after consolidation of previous lows, enter, note that it is after consolidation (three lines entangled);
3. Stop loss: previous high + 2 points;
4. Take profit: 1.5-2 times the stop loss.
3 examples:
Large moving average retracement.
A strategy mentioned by a big guy, win rate 80, profit-loss ratio 2-3, very simple, but the downside is few trades, all rely on waiting, cycle 1min, mainly trading rebar.
Taking short as an example:
1. Three EMAs, periods 8, 28, 98, confirm trend with three lines in a bearish arrangement.
2. After exiting the trend, wait for a pullback, wait for K to touch the 98 line, form a shadow line and then short in the direction of the trend. If the price moves far from the 98 line, wait for the pullback to end and return below the 98 line before shorting, but the best situation is still a shooting star.
3. Stop loss: previous high + 2 points;
4. Take profit: trailing stop.
4 examples:
Naked K + MACD
Friend's system (approximately): taking rebar as an example, 5-minute cycle, naked K + auxiliary MACD, only trading W bottoms or M tops.
Taking long as an example--
1. K-line pattern forms W bottom + MACD divergence, turn long.
2. Entry at the bottom.
3. Stop loss 3-5 points, reduce half position if the neck line is not broken, take profit 3-5 times if the neck line is broken.
4. Position: enter with 80% position.
5 examples:
Moving average + MACD
Win rate 65%-70%, profit-loss ratio 1-1.5.
Rebar, taking short as an example:
1. Large cycle 2h, EMA21&60 death cross, prepare.
2. Entry cycle 15 minutes, MACD fast line crosses below zero line.
Open short.
3. Stop loss: previous high + 2-5 points.
4. Take profit: fixed 1:1 take profit, or golden cross take profit below the zero line.
5. Position: set position based on maximum acceptable psychological loss (1 time).
Principle: 15-minute cycle, do not open positions above the MACD zero line, do not go long on golden crosses, do not go short on death crosses.
Never think that the strategies above can be made profitable immediately; it requires you to simulate and modify to make it your own.
The core is to follow the rules! Repeat simple things!
This is the standard path I believe can truly make small funds grow big. If anyone disagrees, I hope to be lenient.
Hope this helps those who see it; I heard that liking can increase win rate and improve profit-loss ratio, making it bigger and stronger!!
(Military brother encrypted) 6 years deep in the coin circle, short-term gaming reveals the truth, medium-long-term layout has rules. Accurately capture the optimal trading opportunities, one-hand information empowers your investment decisions. Choose the right direction, find the right rhythm, here is the professional perspective you need.
