In stock, futures or other financial markets, sideways refers to a state in which prices fluctuate slightly over a period of time. In order to make the rally after the sideways strong, we need sufficient consolidation time first. Long-term consolidation can allow long and short sides to fully change hands and create conditions for subsequent gains. For example, after a few months of sideways trading, once a stock breaks through the consolidation range, it often has a strong upward momentum.
During the sideways period, the trading volume usually shrinks gradually, indicating that the power of buyers and sellers tends to be balanced in the market. When the trading volume shrinks to a certain extent, once new buyer forces intervene, it is easy to break the balance and trigger price increases. Therefore, the change of trading volume is an important basis for judging whether it rises after sideways.
The resistance level in sideways is the key point for both sides to compete. When the price successfully breaks through the resistance level and stands firm, it shows that many forces have taken advantage and the probability of price increase increases. For example, a futures variety failed to break through a certain resistance level many times during the sideways period, but once it successfully breaks through and stands firm, it often means the beginning of a new round of rising market.
In addition to the above technical conditions, the market environment is also an important factor affecting whether it will rise after sideways. For example, the overall market environment is good, favorable policies and other factors will help push up prices. On the contrary, if the market environment is not good, even if the technical conditions are available, the price increase may be weak. Therefore, when analyzing the conditions of sideways rising, we need to comprehensively consider external factors such as market environment.
In short, judging whether it rises after sideways, we need to comprehensively consider many factors such as consolidation time, volume, breakthrough resistance, market environment and so on. In practice, investors also need to combine their own investment objectives and risk tolerance to formulate reasonable investment strategies.