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AVNT's recent trend has been a bit uncomfortable—during the sharp rise this morning, I chose to stay on the sidelines, betting on a more reasonable entry point. The good news is that the opportunity has finally arrived.
Looking at the 4-hour chart, after a significant rally, a healthy pullback has occurred, which is a typical profit-taking behavior and not a sign of a top. The RSI has moved down from the overbought zone and is now back to a neutral position, indicating that short-term selling pressure is weakening. Looking at the 1-hour MACD, the histogram has noticeably narrowed, and a golden cross is imminent. Overall, this presents a good opportunity for a trial position.
My trading plan is as follows:
**Entry Strategy**: Start with a light position around the current price of 0.35, investing only 30% of the planned position. If the price pulls back to the 0.332-0.338 range, I will decisively add to the position, increasing it to 70%, which can effectively lower the average cost.
**Risk Control**: Stop-loss is very important; set it below 0.325. Once the price breaks below the previous support low, cut losses decisively—no hesitation.
**Profit Targets**: The first target is near the previous high at 0.368, which is a psychological resistance level. If the market continues to be strong, the second target can be around 0.385, based on the current pattern's resistance level.
Calculating this, the risk is approximately 0.025, with potential gains above 0.035, giving a risk-reward ratio of over 1:1.4, which is quite good. The biggest mistake in swing trading is chasing highs; especially when market sentiment is hot, it's crucial to stay calm and wait for high-quality signals with a plan.