This is a common topic that is easy to talk about but quite difficult to achieve. It is appropriate to describe China's retail investors as "having healed their scars and forgotten the pain". Ask yourself, among the investors who have been struggling in the stock market, how many can correctly examine the ups and downs of the market, and always maintain the vigilance of "walking on thin ice like facing an abyss" while respecting the market? When the trend reverses, how many people assess the situation, identify the trend, and follow the trend? The answer is mostly negative, which indicates that most investors' internal cultivation is still far from enough. Over time, it will inevitably be these investors who will be hurt, and the ultimate result will be being eliminated by the market. This is not an exaggeration.
Although there are daily limit up stocks in a weak market, it is not your opportunity at all. You cannot make money every day. When there is no market trend, even the most capable people find it difficult to make profits. Surviving in a weak market is the top priority. However, many investors always take chances and frequently operate in order to recover their losses as soon as possible. They frequently adjust their positions, switch stocks, chase after gains and sell losses, and the result is that the more they operate, the more they lose. At this point, the best approach is to go short and make up your mind to leave and rest for a period of time. Especially in the case of repeated mistakes, inability to discern the situation, and inability to distinguish market characteristics.
Most investors, without seeing the characteristics of the market clearly, still follow their original operations, even if it is a weak rebound in a bear market, chasing after gains and holding heavy positions, operating according to a bull market mentality, which is very wrong and fatal. If the market is volatile, we must adopt a short-term trading strategy, not be obsessed with battle, not bear the burden, and decisively reduce our holdings. After buying stocks, you should immediately consider selling them at the right time. If it is profitable and rises the next day, you should sell immediately; If you are trapped in a rebound during trading, you should decisively reduce your position and avoid blindly increasing or ignoring it. If there are stocks that have been trapped, the losses can be recovered by adjusting positions and exchanging shares. Do not take chances. When selling tickets, one must be decisive and not tolerate any hesitation or hesitation, especially after a rapid surge. Do not be greedy and avoid indecision. If you are trapped in a stock, don't panic and cut your losses at will. Wait for the intraday rebound and find opportunities to reduce your holdings. In short, band operation is about making decisive decisions, not being obsessed with battle, and not dragging the waters. Any indecision will pay a painful price
Alright, no more nonsense! How to use weekly charts to judge stock trends?
Trend judgment is important
From a practical profit perspective, only investors who see the big trend correctly and operate according to this trend are expected to achieve real big profits. In other words, holding patiently during an uptrend can maximize profits, while taking light or even short positions during a downtrend is the best risk avoidance strategy. Therefore, it is crucial to accurately determine the upward trend in a bull market.
Defects in the daily chart
Generally speaking, the daily chart time is too short, and general trading funds can manipulate stock price trends within a certain period of time, leading to the emergence of fraudulent lines and misleading investors. But in the medium to long term, the overall trend is difficult for general funds to control. So when judging trends, it is ideal to use weekly or even monthly charts for various indicators. When it is difficult to determine the trend of some stocks on a daily basis, using weekly and monthly lines can make it clear at a glance. The important indicators in the moving average are the trends of the semi annual and annual moving averages.
How to use weekly charts to judge stock trends?
Generally, in a bull market, the half year line will always be above the annual line, and short-term stock prices should mainly operate above the annual line. Only when the half year line falls is it time to re evaluate the market. And indicators such as MACD and RSI should also be mainly based on weekly lines, so that it is easy to detect the fraudulent lines of individual stocks during consolidation and will not waste large profits. Of course, using weekly or monthly charts in a bear market can prevent short-term rebounds and better mitigate risks.
Of course, using weekly or monthly charts to determine trends has advantages but also disadvantages, as strong individual stocks often do not sell at the highest price when selling, and cannot buy at the lowest price when participating in individual stocks. Therefore, this operation method cannot pursue buying at the lowest price and selling at the highest price, but can basically grasp the mainstream opportunities of a major market trend, and can effectively avoid major risks and preserve the fruits of victory. From long-term practical experience, this method can reduce the frequency of operations, lower operational risks, and achieve maximum investment returns during a bull bear cycle.
