In trading analysis, the daily level is the key cycle connecting medium to long-term and short-term trends, but its importance needs to be viewed dialectically with the strategy. The following is a summary of core viewpoints:
Core Value of the Daily Level
Balance trend and frequency
Filter out short-term noise to capture mid-term trends (weeks/months), suitable for ordinary traders to formulate daily strategies, avoiding emotional trading caused by frequent monitoring.
Reflects the collective market sentiment
The daily K-line (such as long bullish / doji) visually represents the results of the long-short battle, acting as a 'bridge' between fundamental logic and short-term capital behavior.
Effectiveness of key positions
Daily support/resistance levels (such as previous highs / moving averages) validated over several days can serve as a reference for entry in shorter cycles like hourly charts.
Limitations of the Daily Level
One-sidedness of a single cycle
Need to combine with weekly charts (long-term trend) to determine direction, avoiding mistakenly viewing short-term rebounds as trend reversals; rely on hourly/minute charts to refine entry timing and compensate for daily lag.
Lagging nature of extreme volatility
Cannot reflect severe intraday fluctuations (such as 'spikes' in the crypto market), must combine with low cycle K-line to identify risks.
Market applicability differences
High volatility markets (such as cryptocurrencies) require flexible cycle switching, while low volatility markets can focus on daily trends.
Multi-Cycle Interaction Analysis Framework
Weekly line for direction
Confirm long-term trends (bullish / bearish / consolidating) and filter out 'false signals' from daily charts.
Daily line positioning
Lock in key support/resistance levels and breakout points (such as double bottom / head and shoulders top) to determine the 'value trading zone'.
Hour chart / 15-minute chart for timing
Entry: wait for confirmation signals in the short-term cycle (such as attacking K-line, volume-price coordination). Risk control: set stop-loss at low cycle support/resistance levels to optimize cost-risk ratio.
Pay attention to cycle resonance and divergence
Resonance (same direction across multiple cycles) enhances trend certainty, allowing for increased position size;
Divergence (such as daily rise / weekly fall) requires caution, control position to prevent reversals.
Core Principles of Traders
Adhere to system consistency: clarify the time frame of the strategy (such as daily wave), and avoid cycle confusion.
Accept imperfection: every cycle has win-loss probabilities, evaluate the strategy based on long-term win rates rather than individual wins and losses.
Flexibly adapt to the market: adjust cycle focus according to market characteristics (such as bull-bear rhythm in crypto), hold long in bull markets and short in bear markets.
Conclusion:
The daily line is an important tool for medium-short term trading, but not the only basis. Traders need to build a three-dimensional framework of 'weekly direction + daily positioning + short cycle timing' to balance adherence and flexibility in a dynamic market, thus enhancing strategy effectiveness.
