Category: Money tips Release Date: 2006-08-14
Trend line break on the buying and selling choice of timing for the analysis of important significance, but even if only the market manipulators are often changes in the trend line will be taken under the operation of the market;, therefore, tend to find out whom and when breakthrough, a breakthrough is valid or non-effective breakthrough in the investors is essential. In fact, stock prices tend to hover under the circumstances line often occur, to determine errors in the operation means that market failures, the following provides some methods and market principles to determine, but the combination of the specific situation still prevailing market conditions specific analysis of .
(1) the closing price of the breakthrough is a real breakthrough
Technical analysts study found that the closing price break trend line is a breakthrough and is therefore an effective market signal. To decline in trend line that is anti-pressure line, for example, if the market price has broken the back pressure line, but the closing price is still below the counter-pressure line, which proves that the market really wanted to try high, but not following the buying, selling of the influx of way to make the stock finally closed at back. This breakthrough, experts believe a breakthrough is not valid, that is anti-pressure line is still valid, the market potential is still at the end of the light to change.
Similarly, rising trend line break, should look at the closing price is below the trend line. In the chart records often this happens: trend line break, the stock price returned to its original position, this situation is not a valid sudden sail the opposite is often the trap on the market.
(2) to determine the principles of a breakthrough
In order to avoid errors in the stock market, technical analysis expert summed up the principle of breaking a few to judge true or false:
A. find a breakthrough, the multi-day observation
If the break after two consecutive days after the stock price continued to break the direction of development so that a breakthrough is the effective breakthrough is a sound timing. Of course, one city, two days later, the stock has been a large change: the bought shares higher; the throwing of the stock lower, but, even so, because direction is clear, the general trend has been set, investors will continue to accomplish much more than The rush into the market much better.
B. Note that two days after a breakthrough high-low
If the day's closing price of breaking down trend line (resistance line) to move upwards, the next day, if the trading price of the highest price he can cross, indicating resistance line break after buying a large number of follow-up. On the contrary, stock prices tend to line up at the break down the movement, if the next day's transactions are carried out in its lowest below, then the explanation after the break line, and soared to great pressure, it is worth follow-up selling.
C. Reference Volume
Volume is usually measured as market sentiment. For example, in a substantial increase in market price, while volume also increased significantly, indicating the market price of mobile parties asked confidence. On the contrary, although the price upward, but the trading volume decreased rather than increased, indicating follow-up many people, the market for mobile Fang asked had my doubts. Towards the line break is the same token, when the price break line or resistance line, the volume go up or stay if the usual level, which shows broken lines are more people to follow up, the market's confidence in the direction of price movements, investment can follow-up of those who make enormous profits. However, if the broken lines, the volume falling instead of rising, then we should be careful to prevent the break-situ later reply. In fact, some breakthroughs false signals may be due to a number of large stock market, forcing prices due to broader market, such as the major investment companies enter the market, central bank intervention. But the market investors are not a lot of people to follow, leave a breakthrough can be changed, the entire surface potential twins if they believe that such a breakthrough may be at the meeting when.
D. lateral movement
Trend line breakthrough in the study, a description of a situation: a trend break is not necessarily a new trend in the opposite side with the immediate start, and sometimes rise or fall due to too hasty, the market require some adjustment for the off the lateral movement. If you pick a very narrow range, they form the so-called state of cowhide. Lateral Games persist for some time, sometimes days, sometimes weeks before the end. Technical analysts said the transportation for the digestion phase or period of consolidation. Games in the formation of lateral complex graphics. After the end of the lateral direction of movement is a rather complex issue.
Understanding of the nature of lateral movement in the direction of movement of the stock grasp of paramount importance. Sometimes, people back and forth within a narrow range for the stock price movement, understand its meaning, a great sense of disorientation. In fact, the lateral movement since it is digested stage, it means that a greater increase in the process of resistance; down process is buying, the buyer and the seller refused to give ground, you buy go up, I am throwing to. In a breakthrough in the rising resistance line tour, lateral movement is a bottoming process, and its lateral degree greater increase in the power of the state get rid of leather is also greater, but also an increase in the leather state is a densely populated area. Similarly, the increase in travel after the market sliding and lateral movement will also occur. Lateral movement formed dense areas, often in the future increase in stock prices rebound resistance zone, that is not enough power, the market difficult to break through dense areas, to change the direction of fall.
