Recently, there have been some more extreme statements that the future is an era of investment and technical analysis will fail.
For example, a stock with a good trend suddenly falls sharply because of a thunderstorm.
For example, a stock with a very strained trend suddenly releases a positive one, and the stock price rises sharply.
Many things in technology will slowly fail due to the changes in the nature of listed companies.
These views seem to be correct, but in fact there are big logical loopholes.
We all know that in the global market, most markets do not set price limits, and are stimulated by various news, resulting in a lot of gaps open low or high.
There are some movements that can seem a little weird, as if technical analysis is ineffective.
But if you take a closer look at the trends of U.S. stocks, Hong Kong stocks, especially weekly and monthly lines, you will find that they are completely in line with the laws of technology.
Loosening the price limit and T+0 will cause greater volatility, but these fluctuations are ultimately in line with technical laws.
Nvidia, which has been very popular in the past two years, if you carefully study the trend, you will find that it is completely in line with the technical laws, waves, adjustment cycles, and even the amount of energy.
The essence of technical analysis will never fail is because technology reflects the inflow and outflow of funds on the disk, or the inflow and outflow of funds forms the cyclical law of the trend and evolves into technical analysis.
Those who say that technical analysis will fail do not understand the essence of technical analysis at all.
It is the funds that come first, and then the graphics, not the funds that come before the graphics.
As long as the market conforms to the law of money, technical analysis will never fail.
Any money that wants to make a profit in the stock market must buy and sell stocks.
Even if you want to make money short, you also need to buy and sell.
There will be an exchange of chips, a change in the turnover rate, and a change in volume.
Of course, if you have patience, you can deliberately control the trading volume through long-term and small-batch buying, which has the effect of covering people's ears.
The same is true when shipping, you can sell in small batches, or reverse to cover up your trading traces.
Another point is that in order not to expose their intentions, the main force often washes the dishes.
The small wash will stay at the daily level, the large wash will stay at the weekly level, and there is almost no monthly wash.
Because the "fraud" of funds for the disk also requires time and cost, the fraud line rarely appears on the weekly line, and it is almost impossible to appear on the monthly line.
This is the essence of technical analysis, the effectiveness of trend analysis.
Short-term technical analysis is often prone to errors, which is due to the deliberate deception of the main force, resulting in short-term fluctuations.
To do short-term, you must have the awareness of making mistakes, otherwise, it is easy to fall deeper and deeper.
The essence of technical analysis is not at all about predicting tomorrow's ups and downs.
If technical analysis can predict the rise and fall of the next day, then there may be a situation where technical analysis makes money every day.
You know, even if you only earn 1% a day, more than 240 trading days a year, it is more than 10 times.
This is equivalent to adding a zero every year, and after eight years and ten years of stock speculation, you can buy the entire stock market.
Therefore, technical analysis is not played like this, and the so-called tactics are just a way to "flicker".
Otherwise, they don't need to sell any tactics, they just have to make a fortune by speculating in stocks themselves.
Therefore, many technical analysis paths, under the influence of interests, in the face of greedy desires, have been completely deviated.
There are four core areas of technical analysis.
There may be many friends who may not be able to understand, but if you understand it slowly, you will be able to understand a lot.
Although we ourselves seem to be the way, we are actually on the road of continuous comprehension and iteration of technical analysis.
First, trends.
The trend is easy to understand.
Funds to buy or sell stocks will definitely drive the trend, because the chips are out of balance.
Upward trend is an upward trend, downward trend is downward trend.
The determination of the trend is generally based on at least the weekly line, and the trend of the daily line will drive the trend change of the weekly line.
A day's ups and downs cannot form a trend, but only a short-term fluctuation.
If the funds want to make a lot of money, they will definitely lay out in advance, and the trend formed will naturally not be at the daily level, but at the weekly level, or even at the monthly level.
The trend is unstoppable in the short term because money has a cycle from entry to exit.
There is no such thing as a trend at the weekly level, and it will end immediately.
Therefore, it is important to determine the trend.
Moreover, it is easy to determine whether it is a rebound or a reversal, as long as you look at the trend changes of the small cycle and the large cycle.
Second, measure energy.
The amount of energy determines the level of funding.
The trading volume of some stocks is only 2-300 million, or even only tens of millions, so the level of funds involved is definitely not large.
The trading volume of some stocks can reach 20-3 billion, or even 50-10 billion, which must be the main object of big money.
The volume energy does not necessarily depend on the transaction amount, but mainly on the amplification of the trading volume, or the volume ratio.
The volume ratio represents the current capital activity of the stock, and the higher the activity, the more opportunities.
The bottom layer of technical analysis is the amount of energy, and it is also the measure that mainly tracks the movement of funds.
Even if the amount of energy on the daily line can deceive people, the weekly and monthly lines will certainly not deceive people.
But all those that can be effectively amplified have the opportunity to participate, but stocks that have been shrinking for a long time should try not to participate.
The most easily distorted are those that are originally small in terms of quantity, but suddenly the amount can be magnified and particularly obvious, and it is easy to make wrong judgments.
There is another point that needs special attention to the amount of energy, that is, continuity, which is generally measured by 3 trading days.
Third, cycles.
Large cycles, small cycles, the judgment of technical analysis is different.
As mentioned earlier, the smaller and shorter the period, the more likely it is that technical analysis will fail.
Some market day trips, or week trips, technical analysis is difficult to capture.
The larger the cycle, the better the effect of technical analysis, and the higher the probability of making money.
If you are willing to get rich slowly, then you must learn technical analysis, it is an antidote.
But if you want to make a fortune right away and learn technical analysis, it is likely to be a dose of poison.
So many short-term and ultimately successful are very few, because the short-term game is a big win for the main funds, without exception.
Fourth, space.
Finally, the important core of technical analysis is space.
Technical analysis can effectively determine the space on the basis of large cycles.
Spatial quantitative, according to the direction of the trend, the amount of energy and the strength of the short-term rise, to measure the height of capital exit.
Including the downtrend is exactly the same, you can measure the position of the space through the technical pattern, the position of the stock price.
Spatial quantification is the most complex part of technical analysis, and it is also the key to determining how much you can earn.
Many people say that the rise is related to performance, but it really has little to do with it.
The space is completely determined by the strength of the funds, and most of them will be bubbled, and there is not much to do with performance.
Performance can only determine the lower limit, and capital can really determine the upper limit.
Technical analysis does not pay attention to paper talk, but pays attention to actual combat and the accumulation of experience.
No matter how much technical analysis is taught, it is better to understand the logic of trading by yourself, and then continue to verify it in practice.
My current understanding of technical analysis is also the experience gained from so many years of continuous trading, including losses.
No one can take a shortcut directly on the road of technical analysis, even if someone teaches it, you must enlighten yourself, this is the only way.