Recently, I saw many beginners in the community asking how to do short-term trading. Actually, I think this is a field that many people misunderstand. Short-term trading looks simple, but in reality, to succeed, you really need to put in effort.

First, you need to understand one thing: short-term trading means buying and selling within a short period, which can be completed in a few minutes or holding positions for several days. The core of this trading method is not about analyzing company fundamentals, but purely chasing the price fluctuations to profit from the difference. Several short-term trading experts I know have all said the same thing — "win rate" is the key to sustained profitability.

So where are the opportunities for short-term stock trading? From my observations, there are mainly three categories. The first is major trend segments with large price movements and long durations, which are the easiest to identify. The second is wide-range oscillations with moderate volatility but frequent occurrences; as long as you grasp the rhythm, you can continuously accumulate profits. The third is markets with extremely volatile fluctuations, which carry very high risk, and it’s best not to touch them unless you have strong technical skills.

When I judge buy and sell points, the first step is always to look at the moving averages. Moving averages help predict price trends and identify support and resistance levels. If the price is above the moving average, it indicates a bullish trend; if below, the opposite. The second step is to understand the overall market cycle — first, a range-bound phase where bulls and bears repeatedly tug within a certain zone; then a breakout phase, where volatility shifts into a clear upward or downward trend; next, a decline phase, where prices start to retrace; and finally, an uncertainty phase, during which I usually recommend staying away from the market.

When selecting stocks for short-term trading, I pay special attention to three features: having a theme (market hot spots or news-driven), high trading volume (easy to enter and exit), and large price swings (providing profit opportunities). Many people ask me how to find such stocks. It’s actually during periods of intense market volatility or when companies release major news.

In practice, my common short-term strategy is this: when the stock price starts to rise, the increase isn’t big yet, the moving average system shows a bullish alignment, and the daily turnover rate is around 3%, I wait patiently. Once the stock pulls back to the 5-day moving average, I buy decisively. If the overall market is declining but a particular stock rises against the trend by more than 5%, and volume increases, this kind of short-term stock opportunity is worth paying attention to. You can buy at the close of the day or during a pullback the next day.

Another tip is: after a rapid rise, if the stock experiences a sharp decline with decreasing volume, and the decline exceeds half of the previous gain, it’s a good opportunity to catch a rebound. Also, stocks with monthly and weekly candlestick charts at low positions, with accumulated volume, the 3-day moving average trending upward with volume, and a 60-minute chart showing a volume-driven golden cross, are usually in the early stage of a hot sector. These are good candidates for short-term entry.

But the most important point I must emphasize here — risk management. If you make a wrong judgment and the stock continues to fall from a low point, you must cut losses immediately. When the stock reaches your target profit level, you should also take profits promptly. Never be greedy. The root cause of many losses is unstable mentality; simulated trading may be successful, but real trading often results in losses. My advice is to absolutely control your emotions, manage your capital well, understand losses correctly, and always prioritize risk control.

Another thing to realize is that the market always looks forward and reacts to current events. Therefore, technical analysis becomes especially important. Some platforms offer demo accounts where you can practice these strategies, find your rhythm, and then proceed with real trading.

In summary, the difficulty of short-term trading lies in the fact that short-term oscillations are hard to predict completely. You must control losses, and only when prices fluctuate significantly in your favor can you profit. Short-term traders should be good at identifying potential trading opportunities, effectively managing risks, and utilizing technical analysis to maximize gains.