The so-called reversal in the stock market is because the market index has been falling for a long time, giving people the feeling that it cannot continue to fall. Many technical indicators are even in an oversold and passivated state. If a reversal is not carried out, If it moves upward, it will be difficult to continue to fall, and the market will show a situation where trading volume reaches land volume.

The market characteristics of the stock market's counter-draw are roughly as follows:

1. The trading volume during the counter-draw is small and the volume cannot be effectively amplified.

2. There is a lack of hot spots or new influential leaders to lead the rise during the counter-draw.

3. There is no sign of active entry of incremental funds during the counter-draw.

4. The height of the back draw will not touch the top and the breaking position, and it will not have much digestion effect on the upper gear adjustment pressure.

The stock market is generally divided into two parts: the stock issuance market and the stock trading market. The two markets are both different and related.

Issuance market

Also known as the primary market or primary market. Stock issuance is an activity in which the issuing company promotes newly issued stocks to investors by itself or through a securities underwriter (trust investment company or securities company). Most stock issuances do not have a fixed location, but are conducted on securities and commodity counters or through trading networks. The transaction size of the issuance market reflects the scale of capital formation in a country. The purpose of stock issuance:

The first is to raise funds for newly established companies;

The second is to expand capital for existing companies.

There are two issuance methods:

① Issuance by the new enterprise itself, or requiring appropriate assistance from investment companies, trust companies and other underwriters;

② The offering is underwritten by a securities underwriter. Both methods have their own pros and cons. The former has lower issuance costs but takes longer to raise funds. The latter has a shorter financing time, but higher costs, requiring certain handling fees to be paid to investment companies, trust companies or underwriters.

The trading market

also known as the secondary market or circulation market, includes:

①The stock exchange market is an organized organization that specializes in stock and bond transactions. In the market, according to regulations, only members of the exchange, brokers, and securities dealers are eligible to enter the trading floor to engage in transactions. The stocks that enter trading must be registered and approved for listing on the stock exchange.

② The over-the-counter market, also known as the securities dealer’s counter market or over-the-counter market. The main trading objects are stocks that are not listed on the exchange. The stock market price in the over-the-counter market is determined by negotiation between the two parties to the transaction. The over-the-counter market has a fixed location, and generally only does spot trading, not futures trading.

The stock market cycle refers to the process in which the long-term upward trend and the long-term downward trend of the stock market alternate and repeat. In layman's terms, a cycle of rising and falling stocks, that is, the phenomenon of continuous replacement of bear markets and bull markets. The textbook that describes the stock market cycle and its causes in detail is "The Intelligent Speculator".

A stock market cycle generally goes through the following four stages: bull market stage - high consolidation market stage - bear market stage - low bull market stage.

The cyclical movement of the stock market has the following important characteristics:

1. The cyclical movement of the stock market refers to the trend replacement of the long-term basic general trend of the stock market, not the short-term change of the stock price index. Ups and downs. The stock market rises and falls every day, which forms the basis of the cyclical movement of the stock market, but it cannot represent the stock market cycle.

2. The cyclical movement of the stock market refers to the consistent movement of the stock market as a whole, rather than the counter-trend movement of individual stocks and individual sectors.

3. The cyclical movement of the stock market refers to the reversal or reversal of the basic general trend, rather than the short-term or partial rebound or correction of the stock price index.

4. The cyclical movement of the stock market refers to the change in the nature of the stock market during movement, that is, from a bull market to a bear market or from a bear market to a bull market, rather than a simple quantitative change in the stock price index. The nature of a bull market and a bear market is different, but the stock price index may also fall in a bull market, and the stock price index may rise in a bear market. The key depends on whether this quantitative change can accumulate enough to change the basic general trend. transformation.