The rise and fall of individual stocks is actually the tide of funds. When funds enter the market, the stock price rises, when funds leave the market, the stock price continues to fall. The following is the meaning of Bian Xiao shrinking, I hope it will help everyone.
What do you mean by shrinking?
A decrease in shrinkage often means two things. First of all, there is no main force to enter the market, and there are signs of capital outflow. The second is that in order to suppress the stock price, the dealer will wash the dishes by shrinking. Under normal circumstances, it is very likely that stocks will continue to fall after shrinking, but there will be no situation of falling all the way. Individual stocks always have a short-term consolidation platform like the middle step.
The decline in shrinkage of individual stocks is often because no one takes over, so they can only be sold a little bit at the same time at a little price, which will lead to a decline in shrinkage in the long run. There is no way to take over the stock, and no one wants to cut the meat. But in a sense, if the funds in the venue want to flee, then it is necessary to increase the transaction volume.
Therefore, the buying point of shrinkage decline is often near the 60-day moving average. Stocks with large circulation may fall below the 60-day moving average, while stocks with small circulation may fall below the 60-day moving average. Therefore, when the stock price falls to the vicinity of the 60-day moving average, we can observe whether its trading volume is extremely shrinking compared with the previous period, and whether the stock price can tilt its head here and appear a golden fork. If so, this is a better buying point.
It is worth noting that in most studies, the moving averages near the 5-day moving average, 10 moving average and 60-day moving average are called "shrinkage stops", which are often short-term, short-term and medium-term trend change points.
Is the decline of high shrinkage washing dishes or shipping?
1 high shrinkage decline dishwashing characteristics: when stocks are washed with high shrinkage, the trading volume is usually very low, and the stock decline will not exceed 20%. During this period, the K-line of the stock will not show any signs of being broken. When you reach the support point, you begin to see the bottom, so a shadow line often appears. Secondly, the running trend of the intraday time-sharing chart will be more volatile. In the face of washing dishes, investors need to be firm and not be washed leeks.
2 Characteristics of the decline in high shrinkage shipments: inventory shrinkage shipments, but there may be occasional heavy volume. When the stock falls more than 20%, it is likely that the dealer has already started shipping. After the shipment is completed, the K line generally begins to break. When the stock is supported, it can be clearly felt that many forces are beginning to be in a weak position, so there will be an upper shadow line at this time. After the main shipment, the motivation for the future stock price increase will be weak after the retail investors take over. It is best not to hold stocks at this time.
It should be noted that the shrinkage on the way up may fall to wash dishes, which may be the main shipment. In addition, if the stock shrinks and is at the top of the stock, it means that the buying volume in the market is small, and individuals have no funds to take over at this time, and the stock may continue to fall. In this case, investors need to sell stocks, stop losses in time, or wait and see.
What should I do if the volume drops after stagflation?
When there is a downward trend of shrinking volume after stagflation, it is actually possible to be bearish, but once a stock does not put a huge amount on the top of the previous period within three days, then we need to be prepared to go out. After the stock continued to rise, it accumulated a large number of profit-making discs. When these profit-taking disks are shipped at a high level while maintaining the stock price, or the goods are absorbed by the pending orders, it will form obvious stagflation. Therefore, the subsequent shrinkage decline may be the completion of shipment or dishwashing.
In this regard, we must pay attention to the trend of stock prices in the next three days. If the turnover reaches a new high, you can continue to hold it. If the turnover does not reach a new high, it means that we will be out. The record high volume of stock trading means that the main force has absorbed enough goods in the early stagflation period, so it can be pulled up more smoothly with a little shrinkage, consolidation and dish washing, so this period of time will definitely exceed the high volume of the previous period and cover the cost of opening positions.
There is no record high turnover, indicating that the main force in the previous stagflation period has been completely shipped, and the post-contraction consolidation is only the result of its non-trading and the operation of the remaining retail funds, so the stock's late height is limited, basically forming a short-term top.
Generally speaking, after the volume stagflation, the volume decreases. We must pay attention to whether the stock can achieve a large volume in the later period of shrinkage. If it doesn't appear, it means that the stock is almost there.