Support refers to the area where demand is concentrated, that is, the gathering area of potential purchasing power. Because the demand in this area is strong enough to prevent the price from falling further. It can also be understood that when the price reaches this area, it looks very cheap, so buyers are more inclined to buy, while sellers are reluctant to sell, so demand begins to exceed supply.
Pressure refers to the area where supply is concentrated, and when the price reaches this area, the seller's power will appear. Because the selling pressure in this area is strong enough to prevent the price from rising further. When the price reaches this area, the seller is more willing to sell, while the buyer's willingness to buy is weakened, so the supply exceeds demand and the price cannot continue to rise.
The pressure support on the K line includes: intensive transaction area, early high and low points, price type, trend line, percentage correction, technical indicators, etc.
Pressure support on time-sharing chart: yesterday's closing price, highest price, lowest price, settlement price, today's opening price, average price, intraday high and low points, etc.
The advantage of this method is that it can make the setting of stop loss and take profit follow the fluctuation of the market as much as possible. The disadvantage is that there are many users, so there are often false breakthroughs. Therefore, when applying this method, we should be able to identify the trap and re-enter the market according to the new signal after exiting the market.
2. Stop loss by the amount of funds: that is, before each entry transaction, clearly plan how many points to lose as a stop loss. This is a good fund management method, but the premise is that traders should design their own profit-taking points and stop-loss points in combination with their own winning rates. For example, if you operate ten times, gain five times, stop loss five times, take profit 120 points, stop loss 50 points, then the result must be winning. How to obtain this profit model, first of all, we should use the risk-return ratio (generally 1: 3) to find the model, second, we should deeply understand the fluctuation of market operation, and third, we should make a comprehensive judgment on market trends such as trend direction, trend type and trend development period.
3. Stop loss with time: This method is mainly used for intra-day ultra-short trading mode. Intra-day ultra-short mode refers to the trading mode in which traders hold positions for as few as a few seconds and as many as a few minutes in order to obtain the price difference of several or dozens points in a certain period or part. For this model, the trading principle is to make use of the influence of some factors, such as the influence of the external market, the breakthrough and false breakthrough of the support level and pressure level in the market, and the sudden news, to make a profit in the case of sudden and large fluctuations. Its advantage is that when the judgment is correct, it can gain profits instantly, even excess profits; When you make a mistake, you can get away with it. It requires traders to have good reaction ability, be able to quickly evaluate the general atmosphere and potential direction of the market, and always pay attention to the market, especially when holding positions.