1、 Analysis of Short term Moving Average (20, 30, 60, 120 day moving averages)
1. To have a broad bottom, the 30 day and its increase lines should return to bond, and the stock price should remain stable on the line. During this stage, it is best for the stock price to experience a long decline, followed by a large volume rebound, then a second contraction, and a new low before stopping the decline. Afterwards, there should be a gradual increase in trading volume, and several active volume increases should be made to touch the 120 day moving average, actively repairing the moving average system with excessive deviation, so that the 30, 60, and 120 day lines can level and bond before considering entering.
2. Among the securities that meet the first point, find the current price that is far away from the high point of its previous intensive trading area and the platform, or has already broken through upwards. Before the breakthrough, the long and short moving averages have been consolidating for a long time, and the stock price oscillates slightly above and below the line, and at a certain node, a large amount of bullish candlesticks are placed (or a gap is formed by jumping upwards to form a breakthrough), and after effective pullback confirmation (shrinking volume, shallow pullback, strong support from the 30 day line and still maintaining an upward trend), bravely intervene.
3. Once a stock enters the uptrend period, the 20- and 30 day moving averages should consistently rise. At this stage, the stop loss point should be set at these two lines, which should not level or have a turning point. Once they do, exit immediately. At the same time, calculate the ratio of daily increase to the overall market increase. If the initiative is stronger than the market, continue to hold, and pay attention to the divergence rate between short, medium, and long-term moving averages. If it is too large, it means that short-term profits are abundant, and there may be a turning point or at least a retracement adjustment at any time. A healthy and healthy moving average system should not excessively diverge upwards (although this implies strength, which can only be short-term strength), and a good moving average pattern should be one where the short, medium, and long-term moving averages remain synchronized, parallel, and uniformly upward, resulting in a long-term and stable upward trend.
4. When the market changes from disdain to attention, and then to unanimous optimism, one should be aware of the possible fluctuations and be vigilant at all times. 20. Once the 30 day line is flat, consider leaving immediately; The back pressure between the medium-term moving averages is significantly adjusted.
2、 Long term moving average analysis (120, 250 day moving average)
There are some small experiences in the analysis of long-term moving averages of 120 and 250, which are that these moving averages must work within a specific time interval. It is important to pay attention to the conditions under which empirical formulas may hold, such as when the stock price reaches between the 120 and 250 day moving averages, the two moving averages become scissors, which is a relatively difficult situation. (Note that what we are talking about is difficult, not bearish!) Because generally, the downward moving average is the 250 day moving average, and the upward moving average is the 120 day moving average. According to the principle of the moving average, it indicates that the cost of holders of the 120 day cycle is increasing and the 250 day cycle is decreasing. At this time, if the market maker moves upward, it will face pressure from long-term buyers to cash out, and these investors will not be short-term investors. Affected by technological trends, it is inevitable to sell at high prices; On the other hand, with long-term observation, the 120 day moving average is generally the average cost zone for the main force for those long and slow bull bonds. At the same time, the 120 day moving average is their cost for most stocks with low positions. When this moving average is above the stock price, leveling is the best situation. If it is below the 250 day moving average, it is the same as if the main force has not fully invested or even entered the market! You should know that when the moving average is moving upwards, the main cost increases synchronously with the market cost, which will exhaust him to death! And once the market moves or reaches early resistance, facing short-term customers leaving, it will be trapped at a high level. Moreover, there may not be one market maker in a stock, while the cost is paid by the upward promoters. The real breakthrough, which is relatively stable, is to make the 120 day line go from flat to slightly upward.
On the other hand, when the stock price falls into this range, it will not be a small drop, and the time will be relatively long. The price is relatively stable, and the downward pressure usually depends on negative rumors in the market. Otherwise, it will result in the loss of chips, and the market makers may lose their jobs tomorrow. In other words, it's like a chicken rib! Similarly, when these two moving averages appear separately in the above situation, they will also have the same effect, but their strength is relatively weak.
