Only when K-line analysis is combined with volume analysis can we truly read the language of the market and gain insight into the subtleties of stock price changes. Volume is the driving force behind price changes, and its place in real-world technical analysis is self-explanatory. Here we will introduce you to the fundamental law of volume change - the law of volume and price application.
1) in the up and down board system, the first stock of no volume down, after the market will continue to fall, until a large number of appear to rebound or reverse; Similarly, the first stock of no volume up, after the market will continue to rise, until a large number of appear to back or reverse.
2) always have a reason for the release: in the high price area some main force tend to knock on the release, often at some price level on the big sell single, and then eat it, to show its vigor to attract the market to follow the eye, or in some key points on the big buy plate, to show its protection plate determination, all such phenomena are false, the center of gravity real lift can be identified. If it is at a low level knock on the release, it means that the institution is changing the bank or in preparation to pull up a wave of the market, you can choose the opportunity to follow up.
3) in the share price after a long decline in volume to form a trough, the share price rebound, but then the volume did not increase with the price, the share price rose lack of again fell to the previous trough near the bottom, sometimes higher than the previous trough, but the second trough volume is significantly lower than the first trough, indicating that there is no downward momentum, a new wave of rising again to get up, can consider buying.
4) down regardless of the amount of volume, as long as the form (moving average, trend line, neckline, box) broken, are to stop in time to stop loss out.
5) high price area a long black, if the next two large sun also can not be engulfed, said the sky is established, should be timely liquidation; high price area regardless of whether there is good and short large Yin and Yang, as long as there is a huge amount, we should be alert to the formation of the head.
6) volume hit a record high, the next day the share price closed but can not be a new high, that the share price must be back; similarly, if the volume of a record low and the price is no longer falling, that the share price will stop falling back up.
7) In the short market, a wave of volume and price can break through the previous wave of highs when the rally, often indicates the end of the short market; in the long market, the price of a new high if the volume of a new high, often indicates the end of the long market, the short market is about to begin.
8) The longer the volume and price bottoming, the greater the height of the rebound, as the saying goes: how long is the horizontal and how high is the vertical.
9) volume and price analysis of small pocket full control of the market share short term analysis is not suitable, but the medium and long term or can not be separated from the volume and price analysis system.
10) Observe the change in volume must be combined with K-line trends and patterns.
11) Volume is the thermometer of the stock market, many of the stocks of the wild rise is not the fundamentals of a substantial change, but the short-term chip market supply and demand caused by.
12) Relative ground volume in an uptrend, where the price falls back to important averages (5, 10, 30 days), is often an excellent short-term buying point.
13) The size of the volume of the stock to determine whether the right to grab before ex-rights, the initial period after the filling of the right to post: ex-rights if the volume of pulling the positive line to fill the market; no volume or reduced volume often appears to be the right to post.
14) dark horse stock volume changes in the bottom when there are generally two characteristics: one is the volume at the bottom of the low from a certain day suddenly enlarge, and then maintain a certain magnitude, almost every day to maintain at this level, in the daily chart of the stock price rose slightly, down often appear cross-star shape; another is the volume from a certain day gradually enlarge, and maintain this enlargement trend, the stock price is often shown as a small continuous This means that the main force has no patience or time to slowly enter the goods, and has to push the share price all the way up while pulling suction.
15) At the end of the consolidation at the bottom of the share price, the share price fluctuations gradually shrink; volume shrinks to the extreme point after the volume increases, the share price breaks through the board with a medium sun and stands above the 10-day average; volume continues to enlarge the share price continues to close positive to leave the bottom price for three days as a principle; after the breakthrough the stacked averages turn into a multi-headed arrangement. This is the best short and medium-term buying point, is also the perfect sample of the volume and price averages with.
