As one of the ways of public investment and financial management, stock investment has been recognized by the majority of investors, and investing in the stock market has become a fashion. Investors want to make a lot of money in the stock market, but as an investment, there are profits and losses, and the proportion of losses is often relatively large. Some investors may think that making money in the stock market is nothing more than buying low and selling high, and then repeating the operation to make continuous profits. This seems to make a lot of sense and is true. However, this is not the case, and many times it is often not bought at a low point but sold at a low point; I didn't sell it when I should have sold it, and I didn't buy it when I should have bought it.
The reason for investment mistakes is that investors don't know how to grasp the buying and selling points. In other words, investors do not have a clear concept of when to buy and when to sell, let alone a reasonable stop-loss and take-profit plan, which is very dangerous in the stock market. In addition to paying attention to the numbers that change from time to time on the books, it is more important to pay attention to the risks and opportunities that come at any time, that is, to pay attention to the prompt signals of buying and selling points, only in this way can we be comfortable in the stock market, relax and achieve stable profits.
In the stock market, using the chip distribution indicator, investors can examine whether a stock has the potential to be a strong stock from the following two aspects.
1. A large number of hands changed hands at the end of the falling market.
The first important feature that a strong stock needs to have is that at the end of the previous decline, the chips are changed in large quantities, and this change of hands often occurs in the decline of the stock price. As the stock price falls, there is constantly a large amount of money entering the trading stock, and these buying orders will form a certain support effect on the stock price. As buying comes in, the decline in the stock will find support, and the rate of decline will become slower and slower until the end of the downward trend.
This pattern is reflected in the chip distribution indicator, which is a dense stack that moves downwards at a high level. As the stock falls, its chip distribution indicator continues to form new dense peaks at the low level, while the dense peaks above gradually disappear.
When this pattern appears in the stock chart, it indicates that there is a lot of money to buy the stock at the end of the downtrend. After the stock has fallen for a long time, retail investors often completely lose confidence in the future market and are reluctant to trade, and most of the people who can choose to buy stocks at this time are the main force of the market. Therefore, once the above pattern is formed after the stock has fallen for a period of time, it means that there is a major market force that is optimistic about the future trend of the stock and is buying stocks to build positions. Such stocks have the potential to become strong stocks.
2. Chips are locked when breaking through.
Chips are dense at a low level and are just one of the conditions for a stock to become a strong stock. Sometimes, although the chips are dense at the low level, as the stock price rises, the chips continue to move upward, and the low chips are greatly reduced, which shows that a large number of investors are not optimistic about the long-term trend of the stock, and will sell the stocks in their hands as long as there is a profit. These sell-offs will form an important headwind to the future rise of the stock price, and the future rise of the stock price will not be sustainable, and the stock will not become a strong stock.
Strong stocks should be characterized by the fact that as the stock price rises, the low chips remain locked. These locked-in chips are more optimistic about the long-term performance of the stock than the current earnings, because there are fewer chips thrown in the market, and the stock price will not encounter much resistance when it continues to rise, and it will be able to continue to rise in the future and become a strong stock.
Clearance out or full entry? In fact, it is only necessary to take a sneak peek at the "chip distribution" to make it clear
Entering the market - Pulse volume is concentrated to increase positions
When the stock price rises and falls, the price completes a wave of upward movement. Then even after the stock price has fallen, there are trading opportunities. In fact, the signal of the low price is the process of the main investor buying the stock to open a position. After opening a position several times, the stock price will not easily end the upward trend. At this time, we also have the opportunity to open a position and follow the main force to get a return on investment.
Point 1: As shown in Figure 1-1, there is a clear signal of volume in the chart, and the short-term performance of the stock price is very strong. At this time, the stock has the basis for further growth. Although the chip pattern shows that the bimodal chips have appeared at the high price level. However, as the adjustment progresses, the main force continues to complete the process of building positions for the second or even third time, and the stock will have a basis for strengthening.
Point 2: When the price is clearly rising and falling, the H position is an important top area. After the stock price retreated, the main force was determined to open a position during the price correction. When the stock price rebounds and strengthens in the chart, it is not only the moment when the main force opens a position, but also a trading opportunity for us to chase up. We consider buying stocks at this time, which can easily make a profit.
Conclusion: The main force re-opened a position after the stock price rose and fell, indicating that the stock price has the basis for further growth. We can buy stocks when the main force opens a second or even a third position to improve the profit margin.
Point 1: As shown in Figure 1-2, the stock has rebounded for the second time in the daily K-line chart. The efficiency of the main force to pull up the stock price limit is very high, and the stock rises rapidly in the form of the opening price limit, indicating that the main force has obvious intention to open a position. Considering that the main force has opened a position for the second time in the early stage, then this time the stock price has risen in volume and has been the third time that the main force has opened a position. What we can confirm is that the stock is about to enter a definite uptrend. The main force to open a position is just to be fully prepared for the future pull-up.
Point 2: The chip distribution chart can best show the investor's holding cost, and the chips in the chart are gathered in a single-peak pattern, indicating that the stock has adjusted more sufficiently, and the stock price is more likely to have a rebound trend.
Conclusion: After the second opening of the main force, the stock has the basis for strength. At least in terms of chip patterns, the stock price has adjusted in place. After the main force opens a position twice, we buy stocks, and the probability of getting a profit is very high.
Clearance – a pattern of high stacks
The price is high and there is a single-peak pattern of chips, and it is difficult for the stock price to maintain a high level because of the greater selling pressure. After the stock price fell below the peak of chips, a large number of investors have been in a state of loss, although the loss space is not large, but the short signal is very clear. Then we should short when a large number of chips are trapped at a high level to avoid the risk of falling prices. If we don't sell the stock in time, the price will accelerate and the pressure on us will inevitably be high.
Point 1: As shown in Figure 2-1, the stock price in the daily K-line chart has risen significantly, and a single-peak pattern of chips has appeared at the high price. By this time, the chip yield had dropped to 43%. Although the stock price has not fallen sharply, it is difficult for the price to maintain a high level after such a low chip yield.
Point 2: Since the single peak of the high price chip has appeared, and the price continues to fall irreversibly after the stock price falls below the high chip peak, we can consider selling the stock when the stock price has not fallen significantly. The chips below the price have decreased significantly, indicating that the main investors have significantly reduced their holdings. In a bearish trend, we try to hold on as much as possible in order to reduce the loss caused by the holding.
Conclusion: When the stock price falls slightly, the chip peak of the high price is quickly broken, and the trading opportunities in the bearish trend are significantly reduced. Then we should consider selling the stock as soon as possible to reduce the loss caused by the holding.
Point 1: As shown in Figure 2-2, when the stock price falls significantly, the price drop causes a large number of chips to move towards the low. At this time, it is obviously inappropriate for us to hold shares. When the stock price fluctuates and falls, the chips move to a low point, and the peak correction of the chips means that a large number of investors have a low holding price. It shows that the chips of the high price have been transferred, and many investors have completed the meat cutting action.
Point 2: It is clear that when a large number of chips are gathered to the high of the stock price, a bearish trend will inevitably appear. At this time, the trading opportunity quickly disappears, and the investors who choose to hold the stock are bound to suffer losses.
Conclusion: When the chips are transferred to the high price, the price falls below the single peak of the chips, and the downward trend of the stock price continues. Only by reducing our holdings can we avoid the risk of price adjustments.
Finally, the longer I have been in this market, the more I have realized that financial trading is the most difficult, delicate and dangerous industry in the world. If you catch up with the "good times", it is easy to make a lot of money; But in the long run, why do most people lose money? Why do veterans and even masters die (of course, novices die more ugly)?
The answer is simple, but very few people are able to do it: people are idle and do a lot of low-quality transactions that don't make any sense! It is this kind of "hard work" that these inferior transactions not only lose all profits, but also pay back to the old capital; If the debt financing is overdrawn, it will even fall into the abyss from which it will never recover.
Always only do what you are familiar with, good at, and most sure of the trade. Other times, keep your hands in check, endure loneliness, and filter out those meaningless and shoddy transactions. Anyone, boutique deals are only a minority; Anyone, as long as the number of your trades increases, meaningless or even suicidal shoddy trades will quickly occupy a fairly high percentage; Just one of these bad deals is enough to get you into trouble – it doesn't matter if you're a veteran or not.
If you trade long, you will lose your vigilance, especially when you are profitable – this is human nature. This market sometimes seems to be hazy, wanting to fall and rising, weak and strong, weak and cute, sexy, and can be played with. That's why I, including the vast majority, lose money so easily.
In this market, there is no such thing as "supernatural wisdom" or "incredible good luck" that can be outside the laws of trading. The market is cunning, and it is not only the most feared opponent, but also the most ruthless referee. It sometimes looks clumsy, so you think it's a cricket in a bamboo basket that you can tease at your fingertips; But when you lose your vigilance, it will suddenly bite your finger and hold on; That's when you realize that it's a venomous cobra, not a small, cute, and delicate cricket at all.
In this market, "limited contact" can become super-rich; And the "playful" - will eventually lose everything!