Both decline and narrowing mean that the decline is small. For example, GDP data fell by 5% in the first quarter and 4% in the second quarter, and the decline in the second quarter was lower and narrower than that in the first quarter. On the contrary, the decline is rising and expanding, which means that the decline is greater than the previous cycle. Decline and contraction are generally used in the calculation of price or output.

Application of Decline and Narrowing in Stock Market

Falling and narrowing are widely used in the stock market. For example, a stock falls 8% today and 5% tomorrow, and the decline (decline) on the second day is narrower than that on the first day. The narrowing of the decline represents the slowdown of the stock decline, which may be a signal to stop falling. If the stock shrinks sideways, it may stop falling and start to rebound. However, the narrowing of the decline does not mean that the market outlook will definitely stop falling and rebound. Even if the shrinkage fluctuates, the market outlook may continue to fall. Whether it can stop falling and rebound still needs to be judged comprehensively in combination with technical trends and fundamental conditions, and cannot be judged unilaterally by indicators.