Category: Money Tips Date: 2006-01-12
How to divide up five waves and three wave it down? In general, eight waves have different performance and features:
1 waves: (1) almost half of the 1st wave, it is only the first part of creating a pattern at the bottom of the first cycle of a wave is the beginning, due to the rise in this Quotes decline in bear market rally and the anti-post - turn, the buyer is not a powerful force, coupled with the continued existence of short selling, so the first one in such an increase occurs after the first two waves waves to adjust down, its rate of correction is often deep; (2) The other half of the first a wave that appears in the long-term consolidation after the completion of the first one in this type of waves, its rise Quote large, experience shows that the first wave or a wave is usually the shortest of the stock market 5.
Wave 2: This wave is the wave decline, due to the misconception that the market bear market has not yet ended, their adjustment rate of decline quite large, almost eaten by the first wave of an increase, when the Quotes in this wave in the fall near the bottom of the (No. 1 waves starting point), the market appears reluctant sellers, psychology, selling pressure gradually depleted, trading volume is gradually shrinking, the first two waves will adjust to an end, in which waves that often appear in the chart of the shift patterns, such as the head end of double bottom and so on.
3 waves: the first 3 wave rally is often the largest and most explosive rise in waves, this Quotes duration and scope, often the longest, the market to restore the confidence of investors, trading volume increased substantially, it often occurs the traditional The breakthrough in the chart signals, such as the gap jump and so on, this trend is very intense Quotes, a number of points on the graph very easily be puncture, especially in breaking the first wave of a high point, is the most strong buy signal , as the first 3 wave rally intense, often "to extend the wave" phenomenon.
4th wave: the first wave is 4 Quotes rose sharply after the adjustment of waves, usually in the more complex patterns emerged, often a "tilt triangle" trend, but the first four waves of the end point of not lower than the first wave of a vertex.
5 waves: the first five waves in the stock market rally is usually less than the first three waves, and frequent failures in the first five waves, the second and third the stock market is usually a dominant force, its gains are often large in a class of shares (blue chip blue-chip stocks, large stocks), which investors often call a "few kilometers from heaven", this period is quite optimistic about the performance of market sentiment.
No. A wave: In the A wave, the market most of the investing public that the increase in Quotes not reversed, this time correction is only a temporary phenomenon, in fact, A wave decline, in the first five waves usually have a warning signal, such as volume and price movements deviate from the departure or technical indicators, etc., but because the market is still more optimistic at this time, A wave occasional ping potential adjustments or "the" word patterns to run.
No. B wave: B waves are often the performance of small volume, in general, is a long line of escape, but because it is a rising market, so that investors can easily mistaken for another band rally to form a "bull trap "In the meantime many people gotten burned.
No. C wave: It is a destructive decline in strong waves, the downtrend relatively strong, or large, the duration of longer-term, but there is also a comprehensive fall.
From the above view, the wave theory seems to be quite simple and easy to use, in fact, because each of its rise / fall in both the integrity of the process includes an eight-wave cycle, a cycle there are small cycles, small cycles have a smaller cycle, that is, there are small waves to big waves, small waves have small waves, therefore, to make a few waves become very complicated and difficult to grasp, coupled with its push robbery wave and adjust the waves often extends wave patterns and other patterns of change and complexity , making an accurate division of the waves is more difficult to define, these two points constitute the practical application of wave theory, the greatest difficulty.
