How to determine the effective price break Money Tips

Category: Money tips Release Date: 2005-12-22

Shanghai and Shenzhen market rose last week to break the average system to support continuous, showing a downward trend Powei made recently to restore the confidence of investors once again suffered a tremendous blow. In fact, looking back at the recent changes in the market, we can see a lot of individual stocks have been phased out of the bottom of the region. In this market the system to select those shares at the average support level on the stock, without having to be too concerned about market index Change.

In general, the dealer at the Xihuo stage often bad news by the impact of downward price pressure, and only then would cause a panic sell-off to appear. When the dealer at the foot of district smoking chips, the prop up share prices will tend to do the last time before the Powei down a false impression to confirm the thoroughness of cleaning chips.

According to "price-volume three-line rule" principle, in practice to determine the effective break moving average system price support level (or resistance) are mainly the following methods:

1. When the stock price over a longer period of unilateral decline in average system from top to bottom short order, once the stock fell to lows near the front (or new lows), the average for the system to gradually become flat from top to bottom, in which short-term moving average since the bottom-up system ready to attack moving average resistance. If the share price successful attack must have a large volume, otherwise it is a false break, should not intervene.

2. After a longer period of time when stock prices rise unilateral, once the stock price high (or near the high point near the front), the average time the system was arranged long upward run. If the share price to break previous high point, must be based on trading volume greater than the previous high point corresponding to the volume under the premise the contrary, it is false break and should not chase.

3. Shares of the moving average system support bit (or resistance) should be based on the closing price of breaking the standard. Break up when the stock price moving average system resistance, the stock should be included in resistance above the corresponding volume amplification, indicating break up the success of stock should be timely intervention. Break down when the stock price moving average systems support position, the corresponding volume compared with the initial amplification, the stock closed below support at the moving average system that break down the success of stock should be out in time.

Here we have two of Beijing-based (000,728) as an example for analysis: First, choose the medium-term moving average system mix (that is, 10-day moving average, 21-day moving average, 68-day moving average) of which the 68-day moving average as resistance (or support), to confirm the price breakthrough success. The Unit since June 8, 2001 hit a new high of 12.34 yuan after the stage, the share price 23 trading days in a row to break the system, the medium-term moving average support, in the July 6 final price to break a 68-day moving average moving average support, forming the Under the breakthrough potential. At this point corresponds to the volume does not enlarge the share price of the 68-day moving average around sideways. July 12 once again to break the 68-day moving average price support level (Note: volume began to enlarge), followed by stock price plunged to 11.98 yuan from the October 11 low of 6.60 yuan stabilized.

Through the double-dip, after the stock price movements will be solidified at the bottom of the region, December 3 attack on 68-day moving average price resistance successful, the corresponding volume of moderate amplification. Shares after December 11 confirmed a callback support for 68-day moving average after week 3, increase in heavy volume Thursday. From the Handicap change in recent days found that abnormal trading volume in this region amplification, making very obvious signs of reversing positions, particularly in Yao City in December 13 before the close involvement of large single-active, fully reflects the wishes of the dealer to do more.

The recent market & W Technology (600,658), Hainan Coconut Island (600,238), Sichuan Investment Holdings (600,674), etc. have been out of the low stocks breakthrough patterns, investors may pay close attention to his later movements.