K-line chart

K xiàn tú

English: Candlestick Charts

■What is a K-line chart?

A K-line records the price changes of a stock within a day. Arranging the daily K-lines in chronological order forms the historical changes in stock prices, which is called a K-line chart. The K-line graphically represents the increase, decrease, transformation process and actual results of the power of buyers and sellers. After nearly a hundred years of use and improvement, K-line theory has been widely accepted by investors.

K-line is also called candle chart. It is said to have originated from the rice market in Japan in the 18th century. At that time, Japanese rice merchants used it to express changes in rice prices. Later, because of its unique marking method, Therefore, it is widely cited in the stock market and futures market. It is drawn based on the opening price, highest price, lowest price, and closing price of each trading day (or each analysis period). The structure of the K-line can be divided into three parts: the upper shadow line, the lower shadow line, and the intermediate entity. .

The K line is a columnar line, composed of shadow lines and entities. The rectangle in the middle is called the real body, the thin line above the real body is called the upper shadow, and the part below it is called the lower shadow. The entity is divided into positive line and negative line.

K-line can be divided into daily K-line, weekly K-line and monthly K-line. Minute-line and hour-line are also commonly used in dynamic stock analysis software. K-line is a special market language, and different forms have different meanings.

The K-line chart is intuitive, has a strong three-dimensional sense, carries a large amount of information, and contains rich Eastern philosophical ideas. It can fully display the strength of the stock price trend, changes in the balance of power between buyers and sellers, and predict the future market. The direction is more accurate, and it is a technical analysis method widely used in various media and computer real-time analysis systems.

The K line graphically represents the increase, decrease, transformation process and actual results of the power of buyers and sellers. After nearly a hundred years of use and improvement, K-line theory has been widely accepted by investors.

· When the closing price is higher than the opening price, the real part is generally drawn in red or blank, called a "yang line"

· When the closing price is lower than the opening price, the real part Generally painted in green or black, it is called the "yin line"

Advantages

The real changes in the market can be observed comprehensively and thoroughly. From the K-line chart, we can not only see the trend of the stock price (or the market), but also understand the daily market fluctuations.

Disadvantages

(1) The drawing method is very complicated and it is the most difficult to make among many trend charts.

(2) There are many changes in the Yin line and the Yang line. For beginners, it will be quite difficult to master the analysis. It is not as simple and easy to understand as the column chart.

Characteristics of the K-line chart

The K-line chart originated in Japan and was used by merchants in the Japanese rice market to record the market conditions and price fluctuations of the rice market. The unique marking method was introduced into the stock market and futures market. At present, this kind of chart analysis method is particularly popular in my country and even in Southeast Asia. Because the shape of the chart drawn by this method is quite like a candle, and these candles are black and white, it is also called a Yin and Yang line chart. Through the K-line chart, we can completely record the market performance of each day or a certain period. After a period of trading, the stock price will form a special area or pattern on the chart. Different patterns show different meanings. We can find out some regular things from these changes in form. K-line chart patterns can be divided into reversal patterns, consolidation patterns, gaps and trend lines, etc.

Stock K-line drawing method:

Using the trading time as the abscissa and the price as the ordinate, draw the daily K-line continuously to form a K-line chart

The bars in the K-line chart are divided into positive lines and negative lines. Generally, red cylinders are used to represent positive lines, and black cylinders are used to represent negative lines.

If the closing price during the time period represented by the bar is higher than the opening price, that is, the stock price rises, the bar will be drawn in red, otherwise it will be drawn in black. If the opening price is exactly equal to the closing price, a cross is formed.

K-line chart indicator:

Doji

The name of a candlestick line that provides its own information and has the characteristics of many important patterns. When the market open and close prices are equal, the candle body is smallest and a Doji is formed.

Hammer

A price pattern on a candlestick chart that occurs when the market trades significantly lower than the opening price, but then rises again during the day and closes higher than or close to the opening price. price. The pattern forms a hammer-shaped candlestick.

Inverted hammer (Inverted hammer)

A price pattern in a candlestick chart that occurs when securities trade significantly higher after opening, but close far away from the highest point, losing most of the day. In the case of earnings. Gravestone - An upward market gap that opens higher than the previous day's close. It will go to a new high, then lose power and close near its lowest price, which is bearish momentum. An opening below the real body of the Shooting Star on the next trading day will confirm a trend reversal.

If the open and close prices are the same, the indicator is considered a Gravestone Doji. Gravestone Doji is more reliable than Shooting Star mode.

Shooting Star

A candlestick that reflects a reversal. Previously, the stock price was at a high level and the candle body was large. A shooting star occurs when the day's opening price (usually) is higher than the previous day's closing price, then the stock price climbs to a high, but ends up closing below the opening price.

Three white soldiers (White Three Soldiers)

White Three Soldiers is a bull market reversal pattern, forming three consecutive long white candles. After a period of decline, the White Soldier pattern indicates a change in market sentiment and a reversal from a bear market to a bull market. Confirmation of a bull market is unquestionable, and sometimes reversals create a price support level.

Three black crows (Three black crows)

The bear market reversal pattern consists of three consecutive black candle bodies. Each day opens above yesterday's low but closes below yesterday's low.

Methods of research and judgment:

1. Single-day K-line pattern

The uniqueness of the K-line chart is that the K-line pattern of a single day can be used to initially Determine the strength of the market

The following introduces several basic K-line patterns for reference only:

· Dayang line (long red): The opening price is close to the lowest price of the day, Then the price rose all the way to the highest price and closed, indicating that market buyers were enthusiastic and the rally was not over

· Big Yinxian (long black): The opening price was close to the highest price of the day, and then the price fell all the way to the lowest price Closing, indicating a strong market decline, especially in high-price areas, which is more dangerous

· Lower Shadow Yang Line: The price once fell sharply, but with the support of buying forces, the price rebounded upward and closed at the highest price , it is a strong form

· Lower shadow line: After the price fell sharply for a time, it was supported by buying forces and the price rebounded upward. Although the closing price is still lower than the opening price, it can also be regarded as strong. However, when the high price zone appears, it means that the price has a callback requirement, and you should pay attention to selling

·Shangying Yangxian: The price fell back after rising, and the upward trend was blocked. Although the closing price is still higher than the opening price, there is a gap above it. Resistance, can be regarded as weak

· Upper shadow and negative line: The price is blocked from rising, and the upward trend is blocked. Although the closing price is still higher than the opening price, there is resistance above, which can be regarded as weak

< p>· Lower cross line: The price fell sharply after the opening, but found support at the low level. The buying below was proactive, and finally closed near the highest price, which is strong. When the long lower shadow line appears in the low price zone, it is often an important reversal signal

· Inverted cross line: After the price reaches a high level, it encounters strong resistance at the high level and is eventually forced to close near the opening price. Close. Although there is a desire to go up, the market has correction requirements and is weak. When the inverted cross line appears in the high price zone, it is often an important signal of market change

· Cross Star: Buyers and sellers are evenly matched, and the trend is stable; but in a strong market, the Cross Star often becomes the signal for market strength to change. At the intersection, the market outlook may change.

· One-line: The four-price-in-one K-line reflects that the market transactions are light, and it is difficult to see major changes in the market outlook; but if it appears at the daily limit (lower limit), it indicates that the power gap between buyers and sellers is too great, and the market outlook is unlikely to change. The direction is clear and difficult to reverse in the short term.

Two and two-day K-line combinations

By observing the K-line pattern for two consecutive days and combining whether the current position is in a high-price area or a low-price area, the market is measured and the reliability is Higher

High reversal pattern:

· It closed on the cross line yesterday, and the bullish attack was blocked; it opened higher and moved lower again the next day, and finally closed near yesterday's closing price. It indicates that the competition between long and short is fierce, and the selling pressure above is heavy. You should pay close attention to the market outlook and pay attention to shipments

· The cross line was closed yesterday, and the price showed signs of reversal; the next day it opened below yesterday's closing price , and then the price fell all the way, and finally closed on the negative line, indicating that the short side took the initiative, and more indicates that the market has turned downward, and you should pay attention to shipments

· Yesterday, the positive line closed yesterday, and the buyer's momentum was strong; the next day's high After opening, many parties were unable to follow the trend and attack, and fell sharply to close below yesterday's closing price, so the market weakened; this pattern appears after high consolidation, and you should beware of dealers pushing up shipments

· Yesterday's closing positive line, the buyer The momentum was strong; the next day, the upward attack was blocked again, and finally closed with a negative line, but it was still above yesterday's closing price, indicating that the battle between long and short was extremely fierce, and the bulls won. We should pay close attention to the changes in the market outlook

Low reversal pattern:

· The cross line closed yesterday, indicating that the buying below was active, the price stopped falling and stabilized, and the price continued after the opening of the next day It moves higher and finally closes with a small positive line, so the confidence of the bulls increases and the price rebound is imminent.

This combination appeared in the low price zone, which is a standard rebound form

· Yesterday, the negative line closed yesterday, and the short sellers were fierce. The next day, they opened sharply lower, but the buyers actively entered the market at the low level, and did not fall but rose. Finally, it closed on the positive line and was higher than yesterday's closing price, indicating that the short side's downward attack was weak and the price was likely to rebound

· Yesterday, the bar closed on the negative line, and the shorts were strong, but the next day it opened sharply higher , the price rose all the way, and finally closed at the highest price, indicating that many parties won a big victory, and the market outlook is expected to become stronger

Note:

There are many combinations of K-line, and their meaning is also They are not the same and should be analyzed based on different price levels and their changing trends. Parameter settings can be superimposed with other auxiliary indicators (such as moving averages, SAR, transaction accumulation), etc. to study and judge together

K-line chart’s view and detailed explanation of the actual picture

K-line chart is intuitive and three-dimensional It has the characteristics of strong sense and large amount of information, and contains rich Eastern philosophical thoughts. It can fully display the strength of the stock price trend and the changes in the balance of power between buyers and sellers, and predict the future market trend more accurately. It is an ideal choice for various communication media and computer real-time analysis systems. Apply more technical analysis methods. The recording method is as follows: (as shown in the picture) PS In order to facilitate the modification of my picture, I will use the URL instead. If you are interested, you can check it yourself

. The daily K-line is based on the one-day trend of the stock price (index). The four price levels formed are: opening price, closing price, highest price, and lowest price.

1. When the closing price is higher than the opening price, the opening price is below and the closing price is above. The rectangular column between the two is drawn in red or hollow, which is called the Yang line; its upper shadow line The highest point is the highest price, and the lowest point of the lower shadow is the lowest price.

When the closing price is lower than the opening price, the opening price is above and the closing price is below. The rectangular column between the two is drawn in black or solid, which is called the negative line. The highest upper shadow line is The point is the highest price, and the lowest point of the lower shadow is the lowest price.

2. According to the calculation period of K-line, it can be divided into daily K-line, weekly K-line, monthly K-line and annual K-line.

The weekly K-line refers to the K-line chart drawn based on Monday's opening price, Friday's closing price, the highest price of the whole week and the lowest price of the whole week. The monthly K-line is a K-line chart drawn based on the opening price of the first trading day of the month, the closing price of the last trading day, the highest price of the whole month, and the lowest price of the whole month. In the same way, the definition of the annual K-line can be derived. . Weekly K-line and monthly K-line are often used to study and judge the mid-term market. For short-term operators, the 5-minute K-line, 15-minute K-line, 30-minute K-line and 60-minute K-line provided by many analysis software also have important reference value.

3. According to the fluctuation range of the opening price and closing price, the K-line can be divided into extremely yin, extremely yang, small yin, small yang, middle yin and middle yang, big yin, big yang and other line types. . Their general range of fluctuations (as shown in the figure).

The fluctuation range of the extremely negative line and the extremely positive line is about 0.5%;

The fluctuation range of the small negative line and the small positive line is generally 0.6--1.5%;

The fluctuation range of the middle Yin line and the middle Yang line is generally 1.6-3.5%;

The fluctuation range of the big Yin line and the big Yang line is more than 3.6%.

4. The following uses a time-sharing trend chart with trading volume to illustrate the formation process and different meanings of several typical single daily K-line charts. The time-sharing trend chart records the whole-day trend of the stock price. Different trends form different types of K lines, but the same K line has different meanings due to different stock price trends.

A. Xiaoyangxing:

The stock price fluctuates very little throughout the day. The opening price and closing price are very close, and the closing price is slightly higher than the opening price. The appearance of the Little Yang Star indicates that the market is in a chaotic and unclear stage, and the rise and fall of the market outlook cannot be predicted. At this time, a comprehensive judgment must be made based on the shape of the previous K-line combination and the price area at that time.

B. Xiaoyin star:

The time-sharing trend chart of Xiaoyin star is similar to that of Xiaoyang star, except that the closing price is slightly lower than the opening price. It indicates that the market is weak and the development direction is unclear.

C. Small Yang line:

The fluctuation range is smaller than that of the Yang star. The bulls have a slight upper hand, but the upward attack is weak, indicating that the market development is confusing.

D. Hanging positive line:

If a hanging positive line appears in the low price area, as shown in the figure, the stock price will show a shrinking trading volume during the bottoming process, and as the stock price gradually increases Climbing higher, the trading volume showed a uniform amplification situation, and finally closed with a positive line, indicating that the stock price will be bullish in the future.

If there is a hanging positive line in the high price area and the stock price goes out of the shape as shown in the picture, it may be that the main force is pushing up the shipment, so you need to pay attention. E. Lower shadow Yang line:

Its appearance indicates that the long-short attack in the long-short battle is steady and powerful, the stock price first falls and then rises, and the market has the potential to rise further.

F. Upper shadow Yang line:

Shows heavy selling pressure from above when multiple parties attack. This kind of graph is common in the main force's test trading actions, indicating that there are more floating chips at this time and the upward trend is not strong. G. Crossing the head and breaking the Yang line:

The stock price goes out of the graph as shown in the figure, which means that the bulls have taken the advantage and the market is rising wave by wave. The stock price rises steadily with the cooperation of trading volume, which indicates the market outlook. Bullish.

It is also a cross-over Yang line. If the stock price trend is sideways or falling for most of the day and then suddenly rises at the end of the day, it indicates that it may jump short and open high and then move lower the next day.

In another situation, if the stock price trend shows a wide range of oscillations throughout the day and then closes in the positive direction with heavy volume at the end of the day, it may be that the main force on that day drives away the passengers on sedan chairs through oscillation and washing, and then easily pulls up, and the market outlook may continue to be bullish. .

H. Bald Yang line:

If the Bald Yang line appears in the low price area, it will appear on the time-sharing trend chart as the stock price hits the bottom and then rises in waves and the trading volume increases at the same time. It indicates the beginning of a rising market. If it appears on the way to an upward trend, it indicates that the market outlook continues to be promising.

I. Barefoot Yang line:

It means that the upward momentum is very strong, but there are differences between the long and short sides at high prices, so you should be cautious when buying.

J. Upper shadow Yang line:

It means that the upward attack of many parties is blocked and falls back, and the selling pressure is heavy. Whether the situation can continue to rise is unclear.

K. Lower shadow shadow line, lower shadow cross star, and T-shaped line

When any of these three line types appears in the low price area, it indicates a downward trend. The holding power is strong, and the stock price is likely to rebound.

L. Change Doji

This type of line type is often called a change Doji. Whether it appears in a high price area or a low price area, it can be regarded as a top or bottom. The bottom signal indicates that the general trend is about to change its original direction.

M. Big Yinxian

The stock price traded sideways for a day, and then suddenly went down in volume at the end of the day, indicating that the short side finally took the dominant advantage in the one-day battle, and opened lower the next day. More likely. If the stock price goes out of the wave-by-wave downward trend as shown in the figure, it means that the short side has taken advantage of it and the long side is unable to resist. The stock price will be gradually lowered, and the market outlook will be bearish.

Elements that should be paid attention to when using K-line to judge the market

K-line is a comprehensive reflection of the price trajectory. Whether it is the opening price or closing price, or even the upper and lower shadow lines, they all represent profound meanings. meaning, but the use of K lines must not be used mechanically. The K lines or K line combinations that appear at different stages of the trend operation have different meanings. To study K-line, you must first understand the following elements.

First, for the same K-line combination, the monthly line has the greatest credibility, followed by the weekly line, and then the daily line. Of course, some investors like to analyze the annual line or the minute line. Through research on the futures market and the stock market, the author believes that the reference is of little significance. The combination with a bullish monthly line has the highest probability of rising, and the combination with a weekly rise has high credibility, while the daily line has a higher probability of cheating, but it is very commonly used. Therefore, when using the K-line combination to predict the market outlook, the daily line must be used in conjunction with the weekly and monthly lines for better results.

Second, the appearance of the same K-line combination at different stages of stock price operation means different meanings. For example, if the same harami appears at the end of the decline period, it is more credible than the bottom signal that appears during the shock stage. Therefore, we cannot think that the bottom has arrived as soon as we see the harami line or morning star line. We must look at it in conjunction with the entire trend.

Third, the K-line combination must be viewed in conjunction with the trading volume. Trading volume represents the consumption of power and the intensity of the game between the long and short parties, and the K-line is the result of the game. If you only look at the K-line combination without looking at the trading volume, the effect will be halved. Therefore, trading volume is the motivation and K-line shape is the result.

The above three elements are the prerequisites for studying the Yin and Yang K-line. Only by paying attention to these three points can we study the K-line.