Sometimes there may be many large orders in the follow-up and hanging of orders in the lower range, and at first glance, it seems that the stock price cannot fall. However, this conclusion is somewhat irrelevant because we have made an implicit assumption that these pending orders are willing to buy. However, this assumption may not necessarily hold, as there is a possibility of cancellation for these buy orders, or we can even make the assumption that some of these buy orders have never intended to be executed, and their purpose is to show us.
In fact, we often find that the following large orders disappear without a trace. If all the orders received at these price points are real orders in the market, then multiple investors should be involved, and it is difficult to imagine that these investors distributed in different branches will collectively cancel orders in an instant. Therefore, these orders must only belong to the operators of the main funds, so that the cancellation can be completed at the same time in an instant. Now we need to assess the authenticity of these orders.
Assumption: At least four out of the five buy price ranges are large orders, with an average order of magnitude higher than the buy price range. The stock price has been stable recently and has not experienced a significant increase.
The key to identification lies in the synchronized trend of the overall market, so we still recommend overlaying the trend of the index on the trend of individual stocks.
Firstly, we rule out the possibility of the market naturally accepting orders. Although there may be one or two large orders from the market, the market will never flock to the fourth or even fifth price range unless these prices are in whole numbers, so these large orders can be seen as being for the market to see.
Due to these large orders already being placed there, there is a possibility of passive transactions, such as a large sell order suddenly smashing the following five orders. However, generally speaking, due to the presence of these large orders, market selling will be much smaller, so transactions are usually not made. However, the trend of the index will have a inducing effect on market selling, so we now need to use an index overlay chart.
The decline in the index will lead to more selling, and the main force is more aware of this than us. Therefore, the decline in the index will drive the completion of orders in the next period, so this is the best time to observe.
If the order is cancelled, then these are fake orders. If these orders remain firm even when the index falls, there are several possibilities.
Possible one is that the index's decline is relatively flat, and the main force estimates that the market's sell-off will not be significant. So we will wait for the index to experience more significant downward fluctuations.
Possibility two, although the index has fallen sharply, the main force knows that the market itself is not selling much, and even so, it will not bring out more selling. This indicates that the main force has been operating recently and has a good sense of the market, while also telling us this information.
Possibility three, the main force is willing to increase their chips. Due to not being in the period of establishing positions (which is not a common practice), the main players generally do not want to increase their positions without reason. Therefore, the purpose of doing so is to maintain the stock price and lay the groundwork for short-term price increases.
As long as these large orders are not withdrawn during the process of index decline, especially during a significant decline, it at least indicates that there is an opportunity for the stock price to rise in the short term. However, the plans of the main force are also constantly changing. As long as the market is not bad, there is a high possibility that the main force will seek opportunities to boost the stock price in the short term. But if the market shows a significant decline, the main force is likely to change its original intention.
A crucial issue here is the speed and magnitude of the index's decline, which tests the will of the main force. The key to determining the degree of decline is to observe whether the market trading volume has significantly increased synchronously.
Although we can roughly judge the authenticity of these large orders in the lower range through the fluctuation of the index, whether to follow up also involves multiple other factors, including the short-term trend of the market.
