KDJ indicator, also known as stochastic indicator, is a technical analysis tool, which is common in stock market and futures market. Kdj index consists of three lines: K, D and J. The following is the meaning of KDJ passivation compiled by Bian Xiao, which is for your reference only and I hope it will help you.
What does kdj passivation mean?
KDJ passivation phenomenon: When the market rises or falls for a long time, the market continues to rise or fall, but the KD index is passivated above 80 or below 20. When encountering a strong upward trend or downward trend, KD value is easy to be passivated. At this time, the value of k can be used instead of the value of d, or the overbought and oversold area can be relaxed to above 90 or below 10.
How about kdj passivation
The k value, d value and j value in KDJ index are less than or equal to 20 at the same time. At this time, passivation has already appeared, but it can only be used as the primary condition. Indicator passivation means that when the swing indicator is overbought or oversold for a long time, it will lose its original guiding role in trading opportunities. Simply put, when the market is in some kind of overbought or oversold unilateral market for a long time, the indicators will become meaningless and cannot be used to show the market trend, that is to say, the indicators will be passivated.
In the depth judgment of KDJ index, the judgment of curve shape: M head or triple top, the stock price turns from strong to weak; At the end of W and triple bottom, the stock price changed from weak to strong. If the stock price curve also presents the same shape, it is relatively certain, and the increase can be judged by W-head or triple bottom's shape theory. Generally speaking, the shape accuracy of M head and triple top in KDJ curve is greater than that of W bottom and triple bottom.
Is kdj low passivation good?
KDJ index reflects the strength of price trend in the market with the actual fluctuation range of stock price. The KD indicator only judges the overbought and oversold phenomenon of stocks, while the KDJ indicator combines the concept of moving average speed to form a more accurate basis for buying and selling signals. In practice, K-line and D-line cooperate with J-line to form KDJ index.
Kdj low passivation meaning
The low passivation of kdj means that although the stock price continues to fall at a low level, its kdj index is difficult to reverse. When the kdj indicator is passivated at a low level, it shows that the technical indicator is weak and the technical indicator is strongly supported by the decline. Although the stock price shows a downward trend, the subsequent stock price will rebound with a high probability, which investors can use as a short-term reference buying signal. The longer the formation of low passivation form, the greater the probability of stock price rebound.
Kdj high passivation means that although the stock price continues to rise at a high level, its kdj index is difficult to go up and it is easy to turn its head down. When the kdj index is passivated at a high level, it shows that the technical indicators are weak and the upward pressure on the technical indicators is strong. Generally speaking, when kdj can be passivated at a high level, it is generally an obvious bull market. On the contrary, the passivation of kdj in low position is often an obvious downward trend. The high passivation of indicators can only be formed when the market strength is obvious.
As for the stock kdj, what do you think? When the K-line value is higher than 90, the D-line value is higher than 80, and the J-line value is higher than 100 for three consecutive days, it is called KDJ overbought, which indicates that the stock price has entered the overbought area and the short-term callback probability is high. Shareholders temporarily consider lightening their positions to avoid risks, and short positions continue to wait and see to avoid blindly chasing high.
Bollinger band kdj fool usage
Kdj index was first used in the analysis of futures market, and then it was widely used in the short-term trend analysis of stock market. It is the most commonly used technical analysis tool in futures and stock markets. However, the KD indicator only judges the overbought and oversold phenomenon of stocks, while the KDJ indicator combines the concept of moving average speed to form a more accurate basis for buying and selling signals.
KDJ index application
In the stock market, investors can refer to each other through the technical indicators of Bollinger Band and KDJ to improve the efficiency of technical indicators. In KDJ technical indicators, the J line (purple line) is around 20, and the K line (white line) is around 20, passing through the D line (yellow line), and the J line (purple line) and the K line (white line) continue to run above the D line (yellow line). In addition, when the third line of bollinger band index is on the rise, the stock price runs between the middle line and the high line. It belongs to the bullish trend of stocks in the combination of technical graphics.
In the application principle of KDJ index, the K-line is the quick confirmation line, the value above 90 is overbought and the value below 10 is oversold; Line D is a slow trunk line, with values above 80 overbought and values below 20 oversold; J-line is a direction sensitive line. When the j value is greater than 100, especially for more than 5 consecutive days, the stock price will at least form a short-term head, while when the j value is less than 0, especially for more than several consecutive days, the stock price will at least form a short-term bottom.
When the value of k is gradually greater than the value of d, the graph shows that the K line crosses the D line from below, indicating that the current trend is upward, so when the K line breaks through the D line graphically, it is a buy signal. When the value of k is gradually less than the value of d, the graph shows that the K line crosses the D line from above, indicating that the current trend is downward, so when the K line crosses the D line downward on the graph, it is a sell signal.