Mr. Zhang is a senior foreign exchange trader. Before going abroad, it has been active in China’s securities market, and has created a record of 13 consecutive days of recommending stocks to be the first in the next day’s growth list. In 2000, the foreign exchange market began to fight. After a rough and bumpy period, it finally found a suitable way to deal with itself, winning all 11 transactions in May 2003. His trading experience also affected many investors. In May, the champion of Fuyuan foreign exchange simulation contest mainly used Mr. Zhang’s trading concept and system trading method to soar from 50000 yuan of initial capital to 350000 yuan in a month. The author will introduce Mr. Zhang’s views and views on the foreign exchange market to the investors in the form of interview, and hope that the relevant people can get some profits.
Hi, Mr. Zhang. Can you give me a brief introduction to your foreign exchange experience?
Zhang: I have been engaged in foreign exchange trading for nearly three years. There have been many failures in the middle. I have always wanted to find a way to directly catch the market’s rise point and reduce the transaction risk. To reach the invincible, invincible and invincible realm.
Gao: it’s very attractive. What is the general situation?
Zhang: I tried a lot of ways. A lot of efforts have been made on technical analysis and some research has been done. Whether it is Eastern or western; Modern, traditional; Conservative or radical, I’ve tried. I have also tried a variety of indicators, including the joint use of indicators. But I always feel like there are some problems. Maybe I didn’t study deeply enough. Take wave theory as a case. First, it tries to attribute all market volatility to perfect proportions and structures, like the golden section and fabona magic series. I think there are some problems. Although the overall behavior of human beings may be in line with this most perfect structure. But I don’t think it is possible to achieve a specific currency. Second, the wave theory describes that a driving wave has a five wave structure, and then there is a wave extension in the five waves. It can explain the driving structure of 9 waves. But if there are 7 waves, the wave theory can be explained by adjusting b wave through a wave top by platform diffusion. So, there is always a feeling that can’t be said. After the verification is all right, but there are too many uncertain factors in the judgment in the process. So, finally, I gave up the practice of wave theory, just a way to observe the market.
Besides, trend line and price channel, if you say you use a pen and draw two lines with ruler, the price should be operated in this channel. It can be explained that the channel reflects the overall market will and the speed of market development of the population. But I think it’s a bit of a hang out of the two lines that * is subjective.
Gao: there is a certain reason. What do you think of technical indicators?
Zhang: foreign exchange transactions can not see volume. Technical analysis focuses on price, quantity, time, space and people. This is the second place of the quantity, the use of traditional technical analysis has a great defect. The design idea of KDJ, a common index, borrows the concept of space in physics. Objects fall naturally at the top and bounce naturally at low levels. It sounds like that, but it’s a problem in detail. First, why must it fall at high, can’t he be passivated at high level, as long as the power is strong enough, the ship can still leave the earth. In the financial market, as long as the driving force is large, KDJ can always hover at a high level. If the target is high, the sales will be good and complete. Therefore, the index of market entering a strong area is not very useful or it should be used in reverse. KDJ works in normal market, and it is useful to balance and shake the market and organize the market. It will cause problems when it is put into one-sided market. There is also the question of setting index parameters, whether it is 5,5,5 or 9,3,3 or 89,3,3. Some people like to optimize parameters, but optimization to optimize, the final effect is not necessarily good. For this currency line, it is not possible to change another currency. It’s OK at this time, not at another time. Moreover, optimization requires a lot of raw data and good software. China’s “analysts” software is good. But you are based on the information of the Chinese stock market. You compare the result to foreign exchange. I don’t think it is very good. In terms of optimization, first, the conditions are not enough; Secondly, the limitation is too strong; Third, it violates the principle of index design.
High: what about the RSI index?
Zhang: the design idea of RSI index is also good. The results show that the force and acceleration are reflected, but there are also problems of passivation and parameter setting, and the RSI index is too fast and too advanced. You say power! It does need strength and acceleration to maintain the angle of the market upward, but it is a natural situation. If there is a chip lock-in and the market willingness to trade unprecedented consistency? It has no power, but the market pushes up as it does, and the faster it pushes, physically, without resistance, the same constant speed movement as static. In financial markets, resistance is reverse trading. So there is a time when RSI indicators are in trouble.
Gao: talk about your understanding of MACD indicators.
Zhang: this indicator is a bit interesting. Because his design thought reflects the trend of cooperation or not. But it is too slow. If his old man sends out a signal, in 18 of ten, most of the market has passed, too late. So I don’t have to. However, MACD is the slowest of the three indicators, but it is of the most analytical value.
Gao: can you talk about your favorite heart?
Zhang: average line, K line, nothing else. I look at the market now. I only look at the average line and K-line. Other indicators are not used. If it is necessary, add a MACD, because otherwise the graphics are slightly deformed and uncomfortable to look at.
Gao: can you tell me the skills of your visiting?
Zhang: Yes. Look at the picture, first of all, you need to see the thumbnail. Once the picture is shrunk, you feel like you take a picture, and you can say euro / dollar. This contraction, you tell me, is it up or down.
Gao: it is a way.
Zhang: tell you a story. A senior investor has studied a stock. How to calculate and how to think, it should rise, but the fact? It’s all the way down. He couldn’t think, sat in front of the computer and kept thinking, “what’s the problem?” His daughter came over and asked his father to go out with her and ask him what do you think? Experts told her daughter that I was studying whether the stock was up or down. Her daughter said it took so long to see if it was falling at a glance. The expert suddenly understood everything.
Gao: you’re talking about the power of trends.
Zhang: Yes, it is the power of the potential. We should pay full attention to the power of the trend. I will only do more than short if the trend is up. I will only short and not do much if the trend goes down. Don’t try to do all the market, that’s impossible. Greed and poverty are a little bit of a difference, play hard. As long as you are in the right trend, even if the entry position is not good, you will be locked today and tomorrow. But as long as the fund distribution is reasonable, you will win the money the third day. It’s called losing time without losing money. But what about the reverse? It’s not worth losing time and money.
Gao: you’re saying it makes sense. But the question is, in terms of euro / US dollars, how does the market deal with the situation from the end of June 2002 to the beginning of July 2002 to October 2002?
Zhang: your problem is that smart people make stupid things. Why do you have to trade this market? You can’t understand this market. Why do you have to look at it and do the business? Can’t you wait? Why do you have to find a difficult place to trade. You see, the euro has risen since mid October. You may not understand it at this time. It doesn’t matter. You can do it. By November 2002, you can’t understand it, you can’t do it. By December 6, 2002, you can see that a long sun rose that day, and the average line was in a multi headed arrangement. You should always see it! If not, after December 2, it was a complete multi head arrangement.
High: you’re talking about the average line that helps you rise and help you fall.
Zhang: not exactly. You must know the meaning of the average. It is said to be called the average market price. Some say the average is called the average cost of the market. I give it a definition myself, called the market supply and demand relationship. Looking at the average technique, I summed up a few words myself, which are called slope, distance, divergence, intersection *, bonding and back pressure. You look at any picture seriously. Any one of the 1000 points is not completely long or short. Everyone likes to be smart, but I think it’s stupid to do business. To be a fool and know the direction of the market, if you really don’t know how to trade, call your child, let him face the trend chart, tell you whether to rise or fall, up or down. Don’t try to guess the market’s high and low points. The euro 0.85 starts, and by 0.95, some people start to say the top, to 1.0. Some say that the parity is big, and it can’t go through. By 1.10, we say the euro is over, and it will enter the big four waves to adjust. But what is the result? The other two days, the first two days, the top of the 1.19 was heard loudly. I don’t think it is necessarily the end. Besides, guess right. What? Is it very clever? Yes, you are brilliant. But I said that it was a coincidence to call success, a mistake was inevitable, and the cost was too high.
High: can you give me a little more detail.
Zhang: it’s not easy to finish all. Although, I use the simplest average system. But in fact, the sweet, sour, bitter and spicy in the middle really only know. In summary, I can give you 16 words: “trend is king, cycle conversion, homeopathy trading, adverse market.”. To do a transaction, first of all, it is to set the direction, to make a long, or to short, or not to do it. First, there should be a strict reference standard, then the continuous conversion between various sizes and periods, 5-cycle, 10-loop, 5 antenna, 10 antenna, 100 hour line, 10 hour line, how to skillfully convert each cycle. A signal on the 2-hour chart, you need to immediately realize its role and position on the solar line and the influence on the whole trend, and the influence on the average line system. For the last eight words, I can use four words to describe it as “find the reverse and do the best”. It may not be easy to understand. But you think, see, change, you can understand. In fact, in terms of transactions, it is difficult to say, easy to say, and it is easy. To say it is easy, I will talk about simple market, simple thinking, simple transaction; It is difficult to say that he is difficult, it is completely artificial complex, it is human psychology, greed, fear, stubborn, hesitant, and so on.
I still talk about a mentality. Foreign exchange transactions, including stock trading, are sometimes people who don’t understand much, those who do not do technical analysis make money, and those who do technical analysis do not make money. You don’t understand anything. Tossing coins every day determines the direction of the transaction. You have a 50% win; But you do technical analysis, and the final deal opens, and the winning rate is less than 50%. There are many factors in it, but it must be noticed. In addition, we must chase up and down, and never sell high and buy low. You think, only the former is the one who is in the situation, the latter is against the trend, and it is a guess. You say how high and how low he can go, the wave theory should be the best theory to try to explain the relationship between waves. But it also has many options, 3 waves may be 1.382 times of one wave, twice, 2.618 times, etc. Therefore, high sales and low price are not necessary, and accidental success will inevitably fail.
Many people don’t pay attention to the average line, and they can see it. They think it is too simple and useless. They like to inquire about new technical analysis methods everywhere, buy many new books and new theoretical research. I think it is very naive. Eat all day with a fresh look. The average line system contains a lot of technical information, despises the traditional, simplest and most common average system because of the lack of research on the average line. During this period, I can easily find a moment when the market is about to start through my own average trading system. I call this absolutely invincible entry point. You may not believe it, but at least I won 100% of the time using this system. The key is whether you can be patient enough and confident in your own system, and also the ordinary sense of profit.
Gao: can you tell me about the K-line?
Zhang: it is difficult to build a complete trading system on the K-line itself, but it is the root and the original market data record. Let me just talk about the big Yangxian line. You can see the euro hour chart. The line of 4:00 London time on June 11, 2003 is reasonable and the 10:00 is reasonable. However, the line at 7:00 on June 12 is unreasonable. The line of 15:00 on June 12 is reasonable, and that of 13:00 and 15:00 on June 13 is reasonable, but the line on June 16 is unreasonable. You can carefully consider the reasons. If it is clear, the effect on the line is basically clear. You see that he is unreasonable, is to induce more, you want to enter the field to chase up, you are set on a top. So there is also a problem of filtering fake signals in transactions. K-line is also very useful. If it can be thoroughly understood, it is also a problem. Unfortunately, most people do not want to think about it. They think it is too simple. In fact, K-line is not simple. It condenses most of the essence of Oriental philosophy. Yin produces Yang, Yang generates Yin, old Yin is Shaoyang, old Yang is less Yin, only Yin does not produce, and solitary Yang is not long. Yin and yang are mutually transformed, and the middle of learning is very big.
Gao: listen to you and read ten years of books. Indeed, there are things that contain supreme reasons. Your use of the average line and the K-line is really in the realm of simplification and simplicity.
Zhang: don’t say that. I really spent a lot of time studying this system. But I think I need to learn more and practice. I want to say if there are 1000 mistakes in the market, 1000 scams, I have experienced 990 and have seen through 990. But in the future, I may still be cheated or may make mistakes. I can only say that every time I make a mistake, I am closer to perfection.
Gao: do you have anything else to say to the majority of investors?
Zhang: don’t try to predict the market, or to a stage where the direction of the transaction is unclear or you are not sure or unclear. Trading is waiting for the market to show a signal you can capture completely, and it meets the trading requirements of your system. The rest of the time is a word “wait”, two words “wait”, three words “wait”, and always only trade the simplest and easiest to make clear the market, and always be the fool who follows the market and never be the smart person who tries to advance the market.