What is the difference between a counter-draw and a rebound?

After the counter-draw market appears, the only outcome after the counter-draw is a decline. It should be noted here that the outcome of the counter-draw is different from the outcome of the rebound.

The so-called "rebound" refers to the phenomenon that in a falling market, the stock price sometimes falls too fast and is supported by buyers and faces a temporary rebound. The rebound is smaller than the decline. The trend changes after the rebound market ends are diverse. After some rebounds end, the market continues to move downwards, but in some cases rebounds can change the rate and trend of the stock market's decline. Generally speaking, in double bottoms and multiple bottoms, rebounds are actually brewing reversals. prelude. There is a clear difference between counter-drawing and rebounding at this point. There is only one result of the counter-drawing market, and that is to continue to fall. Precisely because the only outcome after a counter-draw is to fall, therefore, if you participate in the counter-draw market, you must stop as soon as the market is good. You can only move in and out quickly in the short term, and you will be out of profit and loss. You cannot be greedy for a long war, otherwise you will definitely encounter "Waterloo".

The second aspect to pay attention to: after the counter-drawing market appears, the only operational strategy is to lose weight. We know that when the market is in the early stages of a downtrend, investors should not blindly exit their positions after a short-term sharp decline in the stock index. This will often result in selling at the lowest point and resulting in greater losses. In fact, you can choose the opportunity to sell when the market reverses, which is a relatively stable investment strategy.

When the market finds it difficult to get rid of the weak situation and the stock index falls sharply, retail investors often become pessimistic and despair about the market. Most people will panic and quickly liquidate their positions in an attempt to minimize losses. Although this is It is a kind of decisiveness, but when there is technical support, it will be more stable. The counter-drawing market just provides retail investors with the best opportunity to lose weight in the early stage of a falling market. This selling time is usually chosen when the rising market of counter-drawing shows signs of weakness or touches the upper resistance line. The problem to be solved here is to overcome greedy thinking, that is, inappropriately raising the elimination target when a counter-draw occurs, thus delaying the opportunity to reduce weight.

The third aspect to note: After the reversal trend occurs, the only opportunity the market provides to retail investors with light or short positions is to rest. There is nothing to say about this. If the market does not have the motivation to change its weakness, retail investors should be cautious in their operations. Because counter-drawing cannot change the weak market pattern, the outcome will definitely be downward. At this time, even if the market has risen a few points, we should not become blindly optimistic and buy the bottom at will, which will lead to serious failure. Therefore, retail investors cannot take it lightly because of the temporary reversal of the market.

Retail investors should continue to remain calm and cautious in their investment thinking, continue to wait and see, and wait patiently for market opportunities until there is a signal that the weak pattern has changed before taking action.

How to counterattack when the stock price breaks through downward? The counterattack formed after the stock price breaks through an important resistance level can often not change the weak pattern.

1. The counterattack formed after the stock price breaks through an important resistance level downwards often cannot change the weak pattern.

2. In double bottom and multiple bottom forms, the rebound is actually the prelude to a reversal.

3. In a weak situation, the only outcome after the reversal of the market is a decline.

4. In a weak situation, after the counter-drawing market appears, the only operational strategy is to reduce the weight.

5. The only opportunity provided by counter-drawing in a weak position for retail investors with light or short positions is to rest.