Band operation refers to the investment method where investors sell stocks when the price is high and buy stocks when the price is low

Band operation is an effective operation method for the current wave like operation characteristics of the domestic stock market. Although band operation is not the most profitable way, it is always a relatively high success rate method. This flexible and adaptable operating method can effectively avoid market risks, preserve financial strength, and cultivate market sentiment.

Band speculation is more important than finding dark horses. In every year's market, there are main peaks and valleys, and the peak is an opportunity to sell; The trough is an opportunity to buy. Wave band speculation is easy to grasp, which is for the overall market. Many stocks have a certain frequency band. We carefully analyze and judge some stocks, and then determine their value range. When they are far above the value range, the market will experience downward pressure, and then we can sell them; When the stock price enters the undervalued zone, buying at a low level, holding patiently, and waiting for opportunities usually results in significant returns.

Stock selection techniques. Stocks that are more suitable for band operations may experience an unnatural increase in volume during the bottoming stage, and the effective amplification of volume indicates that there are main funds actively involved. Because retail investors will not rush to build positions under the dual impact of negative fundamentals and technical downturns, the increase in volume at this time indicates that some panic stocks are fleeing without considering costs, and the fact that stock prices remain stable during the increase in volume precisely proves that mainstream funds are taking advantage of the situation to build positions. Therefore, it can be inferred that the stock is highly likely to have short-term opportunities in the future market.

Buying technique: Buy during a trough. The trough refers to the bottoming out of the area where the stock price reaches its maximum decline during the fluctuation process. Often, a central area is naturally formed, and investors can choose to buy at the trough position where the market is falling and far away from its bottoming center. Technically speaking, troughs usually appear at the following locations: the lower trajectory of the BOLL Bollinger Bands; The lower support line of the trend channel; The edge line of the transaction intensive area; The stop loss level set by investors in advance; Location of the bottom of the box, etc.

Selling technique: Peak refers to the maximum increase area reached by the stock price during the fluctuation process. Technically speaking, peaks generally appear at the following locations: the upper trajectory of the BOLL Bollinger Bands; The upper track trend line of the trend channel; The edge line of the transaction intensive area; The profit taking position set by investors in advance; Top position of the box.

Stock holding skills: Depending on the wavelength. Wavelength refers to the time required for a stock price to complete a complete wave of market trends. The debate over the superiority of long-term and short-term investment in the stock market has been going on for a long time. In fact, the one-sided adoption of long-term or short-term investment methods is both based on subjective intentions and detached from reality. The length of investment should be based on objective facts, and when the market has a longer wavelength, a long-term approach should be adopted; When the market trend has a short wavelength, short-term trading should be adopted; To adapt oneself to the market, rather than letting the market adapt to oneself. Overall, the market is always operating within a band, and investors must grasp the rules of band operation, fully utilize the relative peak of the rise, and seize the opportunity to sell; Make full use of the fundamental turning point, buy when the market is pessimistic, and only need to do this operation a few times a year to obtain good benefits.

When using band operations, it is necessary to develop and implement band operation plans and strategies based on the operational characteristics of the band market. Specifically, it is necessary to grasp the six elements in the band space: wave axis, wave potential, valley, peak, wavelength, and wave amplitude.

Wave axis

The wave axis refers to the position of relative balance between long and short positions in a market trend. The wave axis is the core element of band operation, measured by the central axis indicator AXES. When the stock price is below the central axis AXES, investors can pay attention to it. When the stock price approaches the trough area of the band market, investors can buy at the right time; When the stock price is above the central axis AXES, investors should remain cautious and sell when the stock price approaches the peak area of the market trend.

Wave potential

Wave potential refers to the overall trend and direction of the market in a certain frequency band. In most cases, the trend of the band market is to maintain a certain slope of upward or downward movement, and absolute level band market is relatively rare. When the stock price is running at a low level and the volatility is extremely small, it is often a precursor to the market breaking through. At this time, unless there is a certain degree of certainty, try to stay calm and watch it improve.

The key to band operation is to follow the trend and adopt different band operation methods according to the different operating directions of the band market, including different operating slopes. For example, when the band market is running upwards, investors should perform band operation without losing their chips; In the downward trend of the market, investors should operate in a short selling manner.

Valleys and peaks

The trough refers to the area where the stock price reaches its maximum decline during the fluctuation process. Peak refers to the maximum range of increase in stock prices during the fluctuation process. Valleys and peaks belong to the buying and selling areas in band operations, mainly composed of the following conditions:

1. The top and bottom positions of the box type for box movement;

2. The upper and lower tracks of BOLL Bollinger Bands;

3. The upper track trend line and lower track support line of the trend channel;

4. The edge line of the transaction intensive area;

5. The investor's predetermined take or stop loss level;

6. The position of the average deviation between the axes of the stock price;

wavelength

Wavelength refers to the time required for a stock price to complete a complete wave of market trends. The debate over the superiority of long-term and short-term investment in the stock market has been going on for a long time. In fact, the one-sided adoption of long-term or short-term investment methods is both based on subjective intentions and detached from reality. The length of the investment cycle should be based on objective facts, but market trends should follow closely. When the market trend fluctuates for a long period of time, a long-term approach should be adopted; When the market trend fluctuation cycle is short, short-term should be adopted; Investors need to adapt themselves to the market, rather than letting the market adapt to them.

amplitude

Wave amplitude refers to the maximum distance that a stock price deviates from its equilibrium position during the oscillation process. Due to the constraints of transaction costs, band operations must have a certain profit margin to be carried out. If the fluctuation range of stock prices is too small, investors should not adopt band operations. Although stamp duty and commission have both decreased in recent years, and the majority of investors' complete transaction fees do not exceed 1%, considering the normal errors in actual operations, the best environment for trading in a trading band is when the volatility of the stock price must reach 3% to 5% or more.

Investors must focus on these factors when developing a band operation plan. Specifically, investors need to achieve the following:

1. Determine investment orientation based on the wave axis.

2. Determine the specific operation method based on the wave potential.

3. Determine buying and selling timing based on troughs and peaks.

4. Determine the degree of intervention based on the wave amplitude

5. Determine the operating cycle based on wavelength