For many stock investors, understanding stock market knowledge is essential, such as futures trading techniques, which is a crucial aspect. Currently, there are many techniques and methods for trading stock indices. If you are not yet aware of them, you can learn from the following points.
1. Psychological Analysis
First is psychological analysis, which refers to identifying a critical point where the market may reverse or continue its current trend. By speculating on market movements, we can gauge the dominant forces, control psychological price positioning as a foundation, and analyze the flow of dominant capital. The direction of capital flow helps predict future trends.
2. Technical Analysis
This analysis focuses on past and present market behavior, using mathematical and logical methods to identify typical patterns and trends. It also employs other technical methods to forecast future market movements. Generally, technical analysis consists of three elements: price, trading volume, and open interest. Key analytical approaches include trend analysis, structural analysis, and market nature analysis. Pattern analysis, through reversal patterns, indicates whether the market’s original trend has ended or will continue.
3. Fundamental Analysis
China’s stock index futures are primarily composed of component stocks and blue-chip stocks, which correlate with the country’s economic cycles. Therefore, fundamental analysis of stock indices includes two aspects: the intrinsic growth capability and profitability of individual stocks, as well as economic policies affecting them, such as changes in reserve requirements and interest rates.
4. Entry Point
The market operates in such a way that if buying activity increases, the stock gains popularity, and its price rises before eventually declining. At this point, it depends on an individual’s ability to read the market and identify hot spots promptly—this is a key factor in short-term trading success. Short-term stock trading requires quick execution and a steady mindset. Ideally, after a correct entry, the stock price rises above the cost. However, if the judgment is wrong and the stock adjusts downward, it is crucial to sell promptly to cut losses.
