No matter what instruments you trade, they can be stocks, bonds, commodities, currencies or derivatives; Everyone wants to improve themselves when trading. So, how to better conduct trading and improve trading technology? The key is to develop a system or model that suits your trading style. The following is a model to help better trade and build a deeper relationship with the market.
D-direction
E-Input
E-Exit
P position
Direction:
Before you trade; The most important is the direction of entry. This may be the result of market analysis, whether technical or basic. You must always know why you decided to trade. The more you know why you enter the market, the more stable your trading performance will be.
Project:
After you decide which direction to enter, whether it is multiple or empty, then you need to determine when to start trading. Do you enter the market immediately or after recall? All admission methods have advantages and disadvantages. In order to make the entrance time consistent, the trading style should be understood and understood in a balanced way.
exit:
There are two main reasons for withdrawing from the market, one is to forget justice for profit, and the other is to reduce losses. The secret of exit strategy is to determine it before entering the market. Yes, only by determining the exit strategy before entering the market can we eliminate the negative emotions associated with specific transactions.
Position:
Positioning is the most important part of the model. Believe it or not, this is the difference between a professional and a novice. After knowing why and when to enter the market and how to exit the market, you still need to determine your trading position to maximize profits while considering potential risks. With the increase of the size of the position, the fear factor also increases exponentially! This is the time when most traders lose control. One of the effective ways to suppress this fear is to trade within the allowed range. If you can lose $1000, make sure you don’t lose more than $1000.
I hope that the next time you trade, you can use the DEEP model to approach the market, improve the level of the model for traders, and prepare how to trade better, which will help deepen the relationship with the market.
