Market makers always use various methods to confuse individual investors when building positions, in order to avoid being discovered. And individual investors always use various analytical methods to try to discover market makers. This article analyzes several main methods of building positions by market makers, providing retail investors with insights into the clues of market makers as a reference.

1、 Suppression of Warehouse Construction Law

Generally speaking, after a stock is sold by a market maker, there will be several major declines, and at this point, the conditions for the main force to build new positions are met. Whether it's the second time building a position after the old main force ships, or the entry of a new main force, they will start collecting before reaching a bottom, and then use their chips to lower the stock price. When the stock price continues to hit new lows and people's morale is low, they will cooperate with negative rumors, making scattered households unable to resist cutting their meat and slowly collecting. The longer the duration at the bottom, the more chips the banker collects.

The market makers who choose this method to build their positions generally have strong funds and do a good job of confidentiality. Otherwise, when suppressed, it will be taken over by others and all previous efforts will be in vain. Individual stocks also need to have potential themes, and then choose to adjust the market trend when the market continues to decline or intervene when there are significant negative news about individual stocks, which can achieve twice the result with half the effort.

2、 Rebound building

This is a common method used by market makers to save time on building positions. By taking advantage of people's mentality of "selling high and buying low", "selling when they see a rebound", and "reducing codes when they see a rebound", they are taking big bites of chips.

When the stock price drops to a low level, the market maker has already gained some chips, but it is still far from their goal. In order to trigger more selling, a rebound is created every once in a while, and then the stock price returns to its original form. After several iterations, retail investors gradually form a psychological stereotype of "selling at any price, and then picking back at the bottom". When the last rebound occurred, everyone sold off one after another, but the stock price never fell back, but instead rose sharply. Those who sold out could only regret or catch up at a higher level. By using this method to build a position, the banker usually leaves double bottoms, composite head and shoulder bottoms, and other forms on the candlestick chart. As long as everyone analyzes carefully, it is still relatively easy to discover the banker.

3、 Bulldozer method

This type of position building method is reflected on the candlestick chart, which involves pulling a bearish candlestick, followed by 2-3 bearish candlesticks, and then 2-3 bullish candlesticks. The trend alternates between bearish and bullish, but the stock price gradually rises. Due to the relatively covert nature of this position building technique and the fact that stock prices are often not at historical lows, it is generally difficult for people to determine whether the market makers are building positions or driving up sales, and the market makers unknowingly collect a lot of chips in this way.

A typical example of this warehouse building method is Jinan Department Store from July to September this year, where the stock price rose from 13 yuan to over 16 yuan due to a mix of positive and negative factors. After completing the warehouse building, it quickly rose after the National Day holiday, and a huge amount of goods were sold out.

4、 Torrential rain

This method refers to the banker quickly taking in chips regardless of cost. Generally speaking, it is mainly when the market is stimulated by positive news or potential major positive news is announced, and the market is about to reverse. Market makers can only use this method to build positions. On May 19, 1999, after two years of market adjustment, the Shanghai stock market suddenly reversed and surged by more than 50 points. In the following days, it also increased in volume every day. Retail investors who were afraid of falling sold their stocks one after another due to their habitual thinking of "selling when there was a rebound" and "buying high and buying low". However, market makers rushed in and crazily snatched up chips. By June 30th, the market had risen by nearly 70%, and many market makers had won big, but retail investors rarely made money.