After two days of pullback, some people have been washed out of the market. As of 2:29:54 AM today, gold has risen by +0.56%, with an increase of 3.5 yuan per gram, recovering the 2740 lost ground and continuing to stabilize. Is anyone regretting leaving the market early?
So, who is easily washed out during gold pullbacks?? Let's take a look at the types of people who are usually washed out:
1. Novices lacking investment knowledge and experience
New to investing, with limited understanding of the gold market, they easily panic during pullbacks, fearing losses and hastily selling.
2. Investors with low risk tolerance
With a conservative investment style, pursuing stable returns, they feel great psychological pressure during pullbacks and choose to exit to control risks.
3. People without a clear investment strategy
They buy gold without a clear strategy, trading solely on intuition or others' advice. During pullbacks, they don't know how to respond and are easily influenced by emotions, leading to wrong decisions.
4. Investors overusing leverage
Using high leverage to amplify profits also increases risks. Once gold prices pull back, they may be forced to close positions due to inability to bear the losses.Five, Investors Affected by Short-term Fluctuations
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Investors who focus too much on short-term price fluctuations and trade frequently may find it difficult to hold firm during pullbacks, ultimately being washed out of the market.
So, how should one respond when facing a gold pullback? Let's analyze together:
1. Long-term Investors
1.1 Assess the Fundamentals
Analyze the global economic situation, geopolitical issues, monetary policies, etc. If the fundamentals of gold remain unchanged, the pullback may be a short-term fluctuation, and there is no need to panic.
1.2 Review the Investment Portfolio
Ensure that the proportion of gold investments is reasonable and in line with investment objectives and risk tolerance. If the proportion is too high, it can be appropriately adjusted, and if it is too low, one can consider increasing holdings when prices are low.
1.3 Maintain Patience
Understand the long-term investment value of gold and avoid being swayed by short-term fluctuations, adhering to the long-term investment philosophy.II. Short-term Investors
2.1 Setting Stop-Loss and Take-Profit Orders
Pre-determine stop-loss and take-profit points to control losses and lock in profits. For example, set the stop-loss at 5%-10% below the cost price and the take-profit at 10%-20% above the expected return.
2.2 Paying Attention to Technical Indicators
Analyze trends through moving averages and other indicators. When a short-term moving average crosses below a long-term moving average and the indicator shows an oversold condition, it may be a buying opportunity. Conversely, when a short-term moving average crosses above a long-term moving average and the indicator shows an overbought condition, it may be a selling opportunity.
2.3 Analyzing Market Sentiment
Monitor financial news, social media, and other sources to gauge market sentiment. Buy when panic selling leads to an overcorrection, and sell when excessive optimism leads to inflated prices.
III. All Investors
3.1 Diversification
Spread funds across different assets to mitigate the impact of gold price corrections, such as investing in stocks, bonds, and funds.3.2 Position Control
Reasonable control of position is essential to avoid overinvestment. The position should be determined based on risk tolerance and investment objectives. For example, if the risk tolerance is high, the position can be controlled between 50% and 70%; if it is low, the position should be controlled between 30% and 50%.
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