The stock market is unpredictable, and no investor can guarantee that they will always be invincible in the stock market. There are many excellent investors in the market, and investment strategies and methods can be used as references, but it is important to understand that even the essence of other people's ideas will always be someone else's, and the most important thing is how to find the most suitable for yourself in the vast sea of theories and transform them into your own investment style, which requires a long time of practice and accumulation. Therefore, after investors enter the actual combat, they must pay attention to the accumulation and integration of knowledge, constantly adjust the investment strategy according to their own preferences, and will definitely form their own investment style over time.
The first signal: the bottom T-line
After a sharp decline, the T-line with a long lower shadow also has an important bottoming signal; There is also an inverted T-line in the opposite direction, and although the two have different patterns, they both have a bottoming signal.
Key points analysis: If after a period of continuous decline or a rapid decline in a short period of time, a T-shaped line appears one day, indicating that the downward bearing force is enhanced, and the bulls will of course recover the lost ground, and there will usually be at least a good rebound market. The greater the amplitude of the T-line (the longer the lower shadow, the greater the validity).
After the T-line appears, it usually continues to rise the next day, and there are also shocks or falls, but the decline cannot exceed 2/3 of the amplitude of the T-line, otherwise you need to be cautious and wait-and-see.
The inverted T-line usually appears at the top of a rising trend, but it also occurs at the bottom of a downward trend on a rare occasion. When appearing at the bottom, although only from the performance of the day, the bulls launched a wave of strong counteroffensive but in the end it was beaten back to the original shape by the short side, it seems that the short side still has an advantage, but this is often a cover up behavior of the main force, the long shadow line is the intention of the main force to test the disk, if the selling pressure is light during the test process, the main force is very likely to choose to attack the next day, if the stock price opens high the next day, you can intervene in time.
Case study: Baotong Technology (300031) buys the bottom T-line
Baotong Technology began to experience multiple waves of decline from the high in the early days, and the new wave of decline also lasted for more than two months, began to fluctuate sideways, and rebounded slightly, but then fell back to the lower edge of the shock area, and after a gap low opened on a certain day, wave by wave shock lower, intraday once killed near the limit price, a new low, but the end of the sudden large single volume rose rapidly, the closing price was only 0.02 yuan lower than the opening price, closed out of a T-shaped line with a long lower shadow line, and the signs of stabilization were very obvious.
The next day, the stock opened lower and fluctuated higher, closing out of the false positive line, but the closing price remained at the top of the T-line. The next few trading days continued to fluctuate slightly, and the closing price remained in the top area of the T-line, and the signs of the bottom were more obvious, and at this time you can intervene in a light position. After that, the stock broke through the area and fluctuated upward, the bottom was confirmed, and investors could appropriately increase their positions and hold the stock to rise. It can be seen that this T-line has become the long-term bottom of the stock, and the subsequent gains have also been quite good.
Note: The opening and closing prices of the T-line do not have to be equal. In practice, there are few extremely standard T-lines or inverted T-lines, and it is difficult for the opening price and closing price to be completely equal except for the limit or the limit down. For the long lower shadow or long upper shadow candlestick with a slight difference between the opening price and the closing price, but the difference is not more than 0.5%, it can still be regarded as a T-line or an inverted T-line.
The second signal: the low-grade five-yang line
The combination of low-grade five-yang candles refers to the continuous appearance of 5 small white candles at a low level after a period of decline. The low-grade five-yang line does not necessarily have to be exactly 5 yang lines, it can be 5~8 small yin and small yang lines, but it must be mostly yang lines, arranged horizontally or obliquely upward.
Key points analysis: After the market has fallen sharply in a row, there is a low-grade five-yang line K-line combination at a low level, which indicates that the momentum of the decline is insufficient, which is likely to be caused by the main force slowly absorbing goods at a low level, and the stock price may develop upward at any time.
Investors can intervene and follow after seeing the K-line combination, but they must pay close attention to the direction of the market breakthrough after that, and if they break up, they can increase their positions along the trend; If it falls below the platform, it means that it is only a consolidation market in the fall, and you should stop the loss in time. Therefore, the combination must be considered after a series of sharp declines.
Case analysis: Erkang Pharmaceutical (300267) low-grade Wuyang line bottoming
Erkang Pharmaceutical has been in a long-term downward trend in recent years, and this wave of decline has fallen from April to late August, with a decline of more than 50%. After a wave of extremely long but small rebound market, to the end of the rebound in late November continued to fluctuate and fall, and hit a new low on January 29, but also closed a long lower shadow of the K-line, after two trading days although the stock price continued to fall, but did not hit a new low, this position is also very close to the rebound in late November, it is possible to bottom again.
From February 1, the stock began to come out of a series of as many as 7 small white candlesticks, and slowly moved up as a whole, forming a low-grade five-yang candlestick combination. Combined with the previous factors, it is judged that the market is very likely to reverse, and investors can appropriately intervene in some positions, as long as the subsequent pullback does not fall below the bottom of the first white line, they can continue to hold. After that, the stock rose in broken steps and after a little consolidation, it began to accelerate the upward trend, and the stock price doubled.
The third signal: the rising sun
If in a period of continuous decline in the market, there is a long black line or a medium yin line on a certain day, and the stock price does not have the inertia to open low and fall the next day, and at the same time it also walks out of a high open high or high white line or medium yang line, the closing price of the yang line is significantly higher than the opening price of the previous yin line, this combination is called the rising sun.
Key points analysis: After the stock price has continued to fall, the rising sun and the rising K-line combination have appeared, indicating that the bears have been exhausted and are unable to continue to suppress, and the multi-party forces that have been recuperating for a long time have begun to resist and take advantage of the stock price, and the stock price is high and high, and the future is bright.
The rising sun is actually an enhanced version of the dawning combination, which indicates that the bullish offensive has suddenly become very strong and will continue to rise in the short term. The more the body of the second white candle exceeds the opening price of the previous black body, the longer the body of the white candle and the stronger the upward momentum in the later period.
Case analysis: Sanju Environmental Protection (300072) is rising in the east
The stock has been in a downward trend, and a new wave of decline began in early March, and the decline slowed down after the end of April, coming out of a period of small volatility.
But from May 22, it accelerated down to kill two yin lines that fell by about 5%, as if they were going to accelerate the fall, but after the yin line appeared on May 25, it did not continue to fall on the 26th, but jumped high and opened high, pulling out a big white line that rose nearly 8%, forming a combination of K-line with the rising sun, plus the huge decline in the stock, a wave of decline since the beginning of March has been close to 50%, at this time it can be determined that the stock will at least have a good rebound market, Therefore, you can intervene in a light position when the stock price breaks through the opening price of 3.76 yuan on May 25.
After the combination appeared, then there were 3 small black lines that fell slightly, when the stock price jumped high again on June 1, it can be confirmed that the bottom reversal combination is effective, and you can add positions to chase in, and then the stock price continues to rise, out of a wave of doubling market.