Recently, many beginners have been asking how to play short-term trading; in fact, this is exactly what I have been doing all along. To be honest, short-term stock trading looks simple, but to truly make money, the details you need to master are far more than you imagine.

The core of short-term trading is to profit from price fluctuations within minutes to days, which is completely different from value investing where you buy and hold for ten years. We short-term traders don't care what a company will look like in five years; we only care about whether the stock price will go up or down in the next hour, day, or week. This trading method carries significant risk, but also offers great profit potential. The key is to find the right trading opportunities.

I’ve found that many people lose money not because of a lack of skills, but because they don’t understand when to take action. Short-term trading opportunities mainly fall into three categories: first, trend segments with large, sustained movements that are easy to identify; second, oscillation zones with small but frequent fluctuations; third, markets with intense volatility but extremely high risk. The first two are the ones we should focus on; unless you have deep technical skills, it’s best to stay away from the third.

To identify truly worthwhile short-term trading opportunities, my approach is as follows. First, look at the moving averages: if the stock price is above the average, it indicates an uptrend; if below, the opposite. Next, understand the four market phases: range-bound, breakout, decline, and uncertainty. I pay special attention to the breakout phase because that’s when you can often make the fastest money. Finally, always follow the trend—when the market is falling, stocks that can rise over 5% against the trend usually indicate active institutional funds, making them good short-term targets.

Regarding stock selection, the three most important features of short-term stocks are having a theme or catalyst, high trading volume, and large price fluctuations. I check for news events, earnings reports, or major news that can stimulate trading, while ensuring both buyers and sellers are very active, so I can enter and exit quickly. As for a company’s fundamentals, they don’t matter much for short-term trading because both long and short positions can profit.

My own short-term trading strategy is executed as follows. When the stock price starts to rise with a small increase, the moving averages are in a bullish alignment, and the daily turnover rate is around 3%, I wait patiently. Once the price pulls back to the 5-day moving average, I buy decisively. Another scenario is during a market decline, if a stock rises over 5% against the trend with increased volume, I buy at the close or during a pullback the next day, often catching a good short-term rebound.

Some stocks surge quickly and then suddenly drop sharply, with volume shrinking. At this point, I wait until the decline exceeds half of the previous rally before jumping in to catch the rebound. Additionally, when the monthly and weekly K-lines are at low levels, and the 60-minute chart shows a volume-driven golden cross moving upward, with continuous large buy orders and sustained volume, it indicates this short-term stock is about to start moving, so I can pre-position.

The most critical aspect is mental control. Many people make money in simulated trading but lose in real trading; the main reason is their mindset collapses. My advice is to absolutely control your emotions, establish a solid capital management system, and correctly understand that losses are part of trading costs. Most importantly, always keep stop-losses in mind—risk always comes first, profit second. If you make a wrong judgment and the stock continues to decline, you must cut losses immediately—don’t hold on out of hope.

Ultimately, short-term trading is about amplifying returns through high turnover, with technical analysis as the core weapon. We need to identify resistance and support levels, and operate within these key points, or follow the trend to go long or short until reaching the next critical level. The short-term stock market always looks forward and reacts to current events, so mastering technical analysis is the key to successful short-term trading.

Finally, I want to say that short-term oscillations are indeed difficult to predict completely, but by identifying potential trading opportunities, effectively controlling risks, and making good use of technical analysis tools, consistent profits can still be accumulated. This is the essence of short-term trading.