What should I do if my trading system encounters a retracement?

Hello, the subject, when your trading system encounters a retracement, you need to determine a few questions:

1. Whether your own trading system is a correct trading system, or whether you really understand this system. This aspect can be roughly seen through 100-200 transactions. If you have been able to make relatively stable profits in the past few months or even years, then there is no problem with this trading system and your own understanding. Let's talk about the next aspect;

2. Do you strictly enforce it? Because a set of trading system is not only technical, but also risk control and so on. So do you have problems with heavy positions or mentality? Another point is whether the recent market is in line with your trading method. If not, you will enter the market forcefully. Then the retracement is not a problem with the trading system, but your own problem;

3. Are there frequent transactions? In terms of probability, the more transactions you make, the more mistakes you may make. If you trade frequently, it is very possible that the error rate will increase and the funds will be withdrawn. If so, you can try to reduce some transactions. frequency. I am now basically doing intraday, almost 1-3 orders a day. I am not tired, and the probability of profit is also very high. ​

The retracement of the trading system can be manually modified by yourself. The most important thing is to control the position. After all, the trading system only judges the future trend based on past experience, and does not refer to factual news.

Ideal retracements do not need to panic. If the retracement exceeds expectations, look for opportunities after you are out of the game. Don’t add more positions to pull, it is easy to blow up

Whether you fully implement your system is caused by your own risk or the risk of the system. Is your system stable in the long run, has the same situation occurred before

This question is very good, I believe this is the only way for many traders.

First of all, you need to summarize the percentage of your position that your retracement period probably occupies in your review, and secondly, you must summarize in what form or market you encountered this retracement period.

The rest is that you need to sort out all these market conditions. The first step is to figure out how to identify this market situation and jump over it. The second is to think of a strategy to deal with this kind of market when you can already identify it with a high probability.

Note: Don't think that all the market conditions will take all, the retracement market you encounter is a welfare market that allows you to rest.

Do a good job in your own risk control, within the range you can afford.

The trading system is not fixed, it is constantly being repaired at any time, it is impossible to remain unchanged, it needs to be constantly updated and debugged to make it more stable.

I wish you a perfect and mature trading system as soon as possible

If you have calculated that he is stable, then the retracement is normal. It is unscientific not to rule out your system if you haven’t counted it, just like the repair industry, you need to troubleshoot!

It is normal for the trading system to encounter a retracement. If it is within the retracement stop loss of your trading system, don’t worry about it, or if you can’t bear the retracement, you can only do short-term orders. If you want to do long-term trading, you must strengthen mental management. If the retracement is large Then it is necessary to re-perfect your trading system.

The specific problem depends on the risk control of the account; to give a simple example, if the account has a maximum drawdown of 30% and is liquidated, then when the continuous drawdown is 15%, the conservative mode can be adopted, and the position is halved; and then the continuous loss is 7.5% , the position is halved again; as long as there is no major problem with the trading system, the probability of survival will be high. After making a profit, restore the previous position; after making a profit, you can also enlarge the position.

Adhere to the implementation of the trading system, but the main premise is that your trading system is stable, sustainable and executable, and the capital curve of a stable trader should be reasonably withdrawn within the feasible range.

Give you a reference on the construction thinking of the trading system

I believe that most mature traders with their own trading systems will encounter retracements during the trading process, which is a painful process.

Let's talk about the formation of the retracement period first. Novices think that with a trading system, they can make money lying down. This kind of thinking is a bit whimsical! The profit of your trading system is because the market just cooperates, and all trends are running on the premise of conforming to your trading system, that is, it is often mentioned that no matter how you operate, you can make money! Don't be blindly confident at this time! This is not your ability, it is just that the market fits your system! That's all! When the market trend cannot run in accordance with your system conditions, this time is the time when the system is unfavorable, and this process is the most tortured! Even loss! Big loss! It's your fault that you doubt life! How to do it? !

If the market makes you earn, you earn, if the market makes you lose, you can only lose! This is an important idea to deal with the retracement period!

First of all, don't be discouraged when you encounter unfavorable periods, let alone fight against the market!

Secondly, when you encounter an unfavorable period, you can either deal with it by reducing your position, but here is a problem that once you reduce your position, the recovery period will be extended. This is a matter of choice. In fact, in the process of trading, we will face many choices!

If you are afraid, don't enter the market, and if you enter the market, you don't have to be afraid. Why enter the market if there is no solution to deal with emergencies before entering the market? For a gamble?

First of all, we need to check whether the retracement is a system retracement. If it is a system retracement, it cannot be avoided. If the trading system does not have an advantage in probability, it is necessary to consider the problems of the trading system.

Even the best trading system will have a retracement, the key depends on the size of the retracement rate. If it is a retracement within the normal range, ignore it. But if the retracement rate is too large, you have to find the problem to solve it.

It is normal for your own trading system to encounter a retracement. A trading system without that is 100% accurate, but you must be sober during the retracement process, don’t be blind, and stick to your trading plan

Retracement is a very normal thing, just like the K-line, it is also folded and folded, and it has never been a straight line. There are forks in the road in life, there are choices, and there are all kinds of twists and turns, and the money curve should be the same

It is a normal phenomenon, the capital curve generally advances three retreats and one wave rises

There is no retracement in the trading system! ! ! It is not a trading system!

First confirm whether this retracement should exist in the trading system, and then confirm whether this retracement will affect the stability of the system. Knowing this answer, you will know what to do

Set the net value retracement red line on the risk control