In trading, the moving average system is a tool familiar to many investors, but few can truly master it. Today, I want to share a moving average trading system that has been validated over many years. The system is simple and clear, with explicit rules for entry and exit, helping you find trends and seize profits in the market.
Basic principle: Trend is king; precise line analysis.
The core of the moving average system is to analyze the relationship between price and moving averages to capture changes in trends. For beginners, the focus is on the shape of the moving averages rather than the precise price points. By observing the direction and structure of moving averages, we can effectively filter out short-term fluctuations and focus on the larger trend.
Graph parameters: Based on 30-minute K lines.
MA8: Signal line for short-term fluctuations.
MA21: Guideline for medium-term fluctuations.
MA65: Key line for long-term trends.
MA144: The dividing line that determines long and short direction.
Operational rules: Clear entry and exit signals.
Uptrend: Look for long opportunities when the price is above the rising MA.
Downtrend: Consider going short when the price is below the declining MA.
Oscillating market: If the MA line is flat, stay on the sidelines.
Trend reversal: When MA144 shows a turning point, it is an important signal for judging trend changes.
Application of MA144: The simplest rule.
When the MA144 line begins to rise, consider going long when the price retraces to MA144.
When the MA144 line begins to decline, consider going short when the price rises to MA144.
When MA144 is parallel, it indicates the market may be in a consolidation phase, suitable for resting and observing.
Stop-loss and take-profit strategy: Go with the trend and exit in batches.
Stop-loss settings: Always use the MA144 line as the basis for stop-loss to ensure timely exit during adverse conditions.
Take profit settings: Use MA8, MA21, and MA65 as different take profit lines to gradually lock in profits.
Partial exit: During large fluctuations, close positions in batches to ensure maximum profit before the trend ends.
Market operation mindset: Stay calm and follow the rules.
Don’t be overly eager for quick results: In the market, timing is more important than precise predictions. As long as you follow trading rules and enter and exit at the right moments, you don’t need to worry about missing every single trade.
Control risk: Avoid large losses during market fluctuations by setting reasonable stop-loss points.
Wait for the right opportunity: The market is full of uncertainties; the best strategy is to patiently wait for fluctuations to arise before deciding when to act.
Summary: Simple rules, extreme execution.
This moving average trading system is not complicated; the key is to trust your system and strictly follow trading rules. It tells us: In the market, there are no permanent tailwinds; only by timely adjusting your mindset and strategy can you achieve long-term stable profits.
Remember: In a complex market, the simplest trading methods are often the most effective.