Some stocks have a trading volume exceeding the usual daily trading volume within 15-30 minutes after a flat opening, and the stock price rises rapidly. This is the most rapid rise during a flat opening.
If a stock experiences a sudden increase in open market volume after the opening of the market, it is a normal phenomenon. However, if the market remains stable or falls after the opening, it is abnormal for a stock to experience a sudden increase in open market volume. Even if there is good news for a stock, it should open high rather than flat, so investors should pay attention to this phenomenon.
There are generally two reasons for the sudden increase in open market volume: firstly, there will be positive news released about a stock, and internal personnel will start to rush for orders, but the buying volume will not be too large, and the subsequent rise of the stock will not continue; secondly, the main force will start to take action, which may be their real steady upward behavior, or it may be a false attempt to make a deal, but it will not be a fundraising behavior. Because the suction action is too obvious and the cost is too high.
If it is a steady upward push, the main goal of the main force is to give enough time for market followers to exchange unstable profit chips in the early stage, and steadily push up the stock price with a large turnover. Of course, when there are too many sell offs and the followers cannot bear them, there will be a downward trend later on. If it is to attract market attention through trading volume, the main force often amplifies the trading volume to several times that of daily trading, and the stock price at this time is often at a temporary high level.
If the main force is doing volume. So its true intention often has two types, as follows.
(1) The main force is unwilling to increase their chips and hopes to be active in following the trend
In general, when the main force enters the upward phase after completing the warehouse building, they often do not use the technique of inversion. Because most of the chips in the early stage have already been acquired by the main players, there are now very few floating chips in the market. Even if there is a small amount of selling, the main force will take full orders; Only when the stock price is far away from the cost zone of the main force, will the main force hope that retail investors can lift the sedan chair. However, at this time, the stock price is already high, and the main force can only create a trading activity phenomenon by reversing to attract market followers to enter. At this point, the main force's purpose in reverse trading is to encourage retail investors to buy up the profit taking positions of other retail investors in the early stage, in order to increase the overall holding cost of the market and facilitate the continued rise of stock prices in the later stage.
(2) The main force hopes to reduce the surge of selling. The purpose is to maintain the stock price
Generally speaking, when the stock price rises, retail investors who were originally planning to sell their chips will wait because they hope to sell at a good price, especially those who have been stuck in the market for a long time. In this way, when the main force reverses the trading volume of the rising stock price, as long as the stock price does not rise too much or is not at a critical resistance level, the selling pressure will be reduced. But the main force is also afraid of increasing their chips, so they choose to operate at the opening because investors are watching and selling will not immediately emerge. Once it emerges, it will be taken over by the following trend traders.
In short, a sharp increase in open market volume is a sign that the main force does not need chips and has certain short-term opportunities. But investors need to pay attention to the overall market environment and the position of stock prices.
