This series of articles has no fixed theme. It aims to use my own knowledge to feedback questions about technical analysis from friends who follow me.
The theme of this article is related to the time cycle of trading. It is also one of the reasons why many traders still fall when they buy and rise when they sell after looking at the direction;
In order to facilitate understanding, the examples in this article are all developed based on the time period of the K-line chart. The content of this article will also include some views on technical indicators;
01丨The period of K line🕗
In fact, the concept of cycle is easy to understand for traders with basic trading knowledge. As shown in the figure below, it shows the trading pair cycle of BTC/USDT on Binance exchange (this is just an example, the cycles of all targets are the same)
我本人是一个日内交易者，所以选择的周期都比较小，而每个周期的选项代表的就是那个周期的K线的包含的时间，1小时图每条K线收盘就包含了过去一小时里面的价格涨跌情况；
The opening price and closing price have become the starting point and end point of the market fluctuations in the past hour; similarly, one hourly line can also be split into two 30-minute lines or four 15-minute lines. It is actually very simple. Arithmetic problem.
Working backwards in the same way, the reason why there are so many time cycle options is also designed based on the trader's own trading time cycle: for long-term investors whose holding time is calculated in quarters, the 1-hour K-line is almost Not available, and for an intraday cycle trader like me, weekly or even daily cycles are basically cycle options that are completely useless, because when I finish a day's transaction, there may not be a single K-line. finish walking;
PS: Intraday trading refers to the trading style of completing purchases and sales on the same day;
02丨Basic logic of cycle selection😀
Why can't we use the weekly line during the day? Why do we use the hourly line or even the minute cycle line for long-term investment? The fundamental reasons are two: noise and trend.
For intraday trading, the importance of judging the trend of the day is much higher than that of the long-term trend. If you use the weekly line as the trend judgment, you must analyze the long-term market trend in quarters/years;
For long-term investors, if you choose a cycle that is too small, there will be too much noise in the market, which will not have a big impact on the long-term trend, so there is no need to be too precise in buying in small cycles of a few minutes;
PS: The noise here refers to the fluctuation frequency in small cycles that is too high, which is not helpful for long-term trend judgment, because eventually the fluctuations in small cycles will be included in the larger cycle K-line;
上图就是BTC在同一的时间段里面不同周期（15分钟/1小时/1日）所走的K线图，越是小的周期出现在盘面的K线图就会越多，也就是区间波动噪音越大，同样的这种短期内的区间波动对长期趋势的影响是几乎可以忽略的；
This is also the reason why many people see that the market is in a strong upward trend on the daily K, but the reason why it falls as soon as they buy is because there is no screening in the small cycle;
03丨Cyclic resonance⚖️
The principle of cyclical resonance is to cooperate with each other during different time cycles and find the turning point where the direction converges. This will greatly increase the certainty after buying and avoid carrying orders in small cycles.
Here I assume that you are a trader who looks at the MACD indicator and makes transactions: buy with a golden cross and sell with a dead cross;
In addition, since technical indicators usually have a lagging nature, signals generally appear in advance in small cycles, and then affect larger cycle signal changes.
The picture above is a recent market example I gave. After a dead cross sell signal appears in the 5-minute cycle, the direction trend of MACD is confirmed step by step. If it has already died or there is a probability of dead cross, then the market will go down at this time. The probability will be magnified!