Reasonably closing positions, buying the best is not as good as selling the best

Mastering the right buying points is only half the success, and adding the right closing positions is the complete success. This is an eternal rule in any investment market,foreign exchangeThe market is no exception.


Some investors have a unique perspective on foreign exchange analysis, both fundamental and technical aspects, but their operational performance often falls short of expectations. One of the reasons is that the timing of closing positions is almost always wrong, either closing positions too early without achieving subsequent substantial profits; Either it is delayed in closing the position, resulting in the market eventually returning to the starting point of the buying point, or even being trapped. It can be seen that grasping the timing of closing positions is a very important fundamental skill.


　　"High throw method" and "secondary top closing method"


Investors all hope for a method, a panacea, such as a certain indicator in technical analysis, that can accurately close positions once the indicator reaches a certain value. However, unfortunately, there are no such technical indicators so far. In fact, as long as we don't excessively pursue precision, there are certainly methods. The "high throw method" and "secondary top closing method" introduced in this article can achieve correct closing, but they are not precise closing.


The so-called "high selling method" refers to investors setting a profit target price for a currency when buying it. Once the exchange rate reaches this target, investors will close their positions. Generally speaking, most investors who use this investment strategy use a combination of monetary fundamentals and technical analysis, such asgoldDetermine a reasonable target price based on segmentation lines, averages, patterns, etc., and then wait for the currency to reach this target price and immediately close the position.


The "second peak closing method" is not to set a target price for oneself in advance, but to keep holding until the exchange rate shows signs of a second peak before selling. Generally speaking, investors who adopt this closing strategy usually use technical analysis to determine the signs of a peak, mainly based on the shape and trend of the exchange rate trend. Specifically, it is determined through double tops, head and shoulder tops, and triple tops that the mid-term head is established and the position is decisively closed.


　　The combination of the two methods has a better effect


Both the "high selling method" and the "secondary closing method" can achieve quite good investment results. However, regardless of which method is used, each has its own shortcomings. For investors who use the "high selling method", they must first master a set of methods to analyze the economic fundamentals of the country where the currency is located, and the target level set by investors must be higher than their current market price. So, unless you have your own uniqueness in the foreign exchange market, setting a target price may be quite dangerous.


For investors who use the "secondary closing method", they mainly judge based on the trend of the exchange rate and do not set a target price for themselves in advance. Of course, the shortcomings are also obvious, which requires investors to invest more time and energy in monitoring the market. That's why some people tirelessly study what "real top" and "fake top" are to avoid being deceived.


When the exchange rate reaches the target price set at the beginning of the purchase, the position should be immediately closed. Because investors always have their own reasons when setting a target price, and the initial target level is generally more rational. As the exchange rate continues to rise, most people's minds start to heat up. To avoid making mistakes, it is best to close positions in a timely manner. After investors close their positions, the exchange rate may continue to rise, which can only be said to be a misjudgment by investors, rather than due to their hot minds. If there is still room for further upward trend in the market, one should have the courage to buy again. However, this is another new operation. Reasonably set the target level instead of being influenced by the previous order.