Start Learning Forex Now: We Provide Tutorial in EN / 中文.
Forex Malaysia 马来西亚外汇

Market Environment 市场环境: Page 4 of 6

Facebook icon

Retracement or Reversal?

Have you ever been in this situation before?

Retracement or Reversal?

It looks as though price action may be rallying and a buy trade is in order.

WRONG!

Failed Reversal

You’ve been hit by the “Smooth Retracement!”

Nobody likes to be hit the “Smooth Retracement” but, sadly, it does happen.

Why?

In the above example, the forex trader failed to recognize the difference between a retracement and a reversal. Instead of being patient and riding the overall downtrend, the trader believed that a reversal was in motion and set a long entry. Whoops, there goes his money!

Check out how Happy Pip got fooled by the “Smooth Retracement” in one of her AUD/USD trades.

In this lesson, you will learn the characteristics of retracements and reversals, how to recognize them, and how to protect yourself from false signals.

What are Retracements?

A retracement is defined as a temporary price movement against the established trend. Another way to look at it is an area of price movement that moves against the trend but returns to continue the trend.

Retracements

Easy enough? Let’s move on…

What are Reversals?

Reversals are defined as a change in the overall trend of price. When an uptrend switches to a downtrend, a reversal occurs. When a downtrend switches to an uptrend, a reversal also occurs. Using the same example as above, here’s how a reversal looks like.

Reversal

What Should You Do?

When faced with a possible retracement or reversal, you have three options:

  1. If in a position, you could hold onto your position. This could lead to losses if the retracement turns out to be a longer term reversal.
  2. You could close your position and re-enter if the price starts moving with the overall trend again. Of course there could be a missed trade opportunity if price sharply moves on one-direction. Money is also wasted on spreads if you decide to re-enter.
  3. You could close permanently. This could result in a loss (if price went against you) or a huge profit (if you closed at a top or bottom) depending on the structure of your trade and what happens after.

Because reversals can happen at any time, choosing the best option isn’t always easy. This is why using trailing stop loss points can be a great risk management technique when trading with the trend. You can employ it to protect your profits and make sure that you will always walk away with some pips in the event that a long-term reversal happens.

回撤或反转

       你之前经历过类似的情形吗?

       看上去汇价正展开新一轮反弹行情,我们可以选择顺势做多吗?

       如果你选择进行上述操作,那么你将大错特错。

       事实证明,这次汇价的回撤让你失血不少。

       没人愿意碰到汇价出现回撤的情形,但是不幸的是,它确实经常发生,这是为什么呢?   

       在上面的例子中,交易者未能区分回撤和反转的区别。交易者并没有保持足够的耐心进而抓住新一轮的下跌行情,而是相信汇价即将出现反转,并多单操作。可惜呀,他的银子也跟随多单一去不复返了。

       在本课中,你将学习到回撤和反转的特征,如何认清它们,以及如何保护自己免受虚假信号的伤害。

什么是回撤?

       回撤的定义是,价格在业已建立起来的趋势运行过程中,出现短暂时间的反向运动。我们也可以将回撤视作价格朝整体运行趋势反向运动的一个区域,在脱离该区域后价格将继续之前的趋势。

       很简单,是吗?让我们继续...

什么是反转

       反转的定义是,价格总体趋势的改变。当上升趋势变为下跌趋势,反转便发生了。当下跌趋势变为上升趋势,反转也产生了。我们在这里还是借用上图的例子,不过这次重点描述的是反转的形态。

你应该做什么?

       当面对可能的回撤或反转时,你有三种选择:

          1. 你可能持有某一货币头寸,当价格的回撤最终被证明是更长期反转走势时,这可能导致你账户的损失。

          2. 如果价格开始再次朝着总体趋势运行,你可能选择平仓再次进入当然,如果价格快速
             朝着单一方向波动,你可能错过交易机会。如果你打算再次入场,你也会损失掉点差费用。

          3. 你可能选择永久平仓。如果价格走势和你的单子方向相反,在你平仓后,这可能导致你出现损失;
             或者是,如果你在价格接近顶部或底部选择平仓,你也有可能获得巨大利润。
             这取决于你的交易结构以及接下来所发生的情况。

       因为反转在任何时候都有可能发生,做出做好的选择始终不是那么容易。这也是为什么,当进行趋势交易时,设置移动止损是非常有效的风险管理方法。你能够利用它来保护你的利润,并能够确保,当汇价出现长期反转走势时,你始终能够带着一些获利而离场。