Funds in the market and those who manipulate them are like soldiers and commanders on the battlefield, while the chips they hold are like weapons to kill enemies. The people who are involved in this war are spending money and fighting psychologically; Whoever is psychologically defeated loses their wealth.
Once the stock reaches its bottom, it means that the main force has bought up all the chips, and the next step is the upward battle. Before launching a rally, we often see stocks suddenly surge in volume for a few days and then fall into a dead silence. This is a reconnaissance test of the main funds, and then we will see intense capital flow (rally).
What is the flow of funds among them? What is the psychology of both the main players and individual investors?
Main fund reconnaissance war
Before the stock enters the uptrend, the main force will first use some funds for trial trading to see how strong the long and short sides are. At this point, the trading method seen on the market is as follows: the main force places orders first, and the buying and selling are matched to push up the stock price. The amount generated in this process is basically the main force using their own chips and funds for activities. If most people adopt the strategy of exchanging chips for funds, the selling pressure on the market will be heavy. Once funds flow into the hands of retail investors, the main force will be very passive, just like the army without support.
So, when there is a heavy selling pressure on the market, the main force has two options: the first is to quickly raise the price and close the limit up, with the aim of creating momentum to boost the stock price and alleviate the selling pressure (in the following days, the stock price will slowly fall, so that short-term investors can follow suit, which can also achieve the balance of the stock's periodic price and relieve pressure for future price increases). At this point, the graph shows that one day the stock hit the limit up and then resumed its decline, while the trading volume is in a state of contraction; The second type is to quickly rise and then quickly fall on the same day, with the aim of quickly withdrawing one's own chips and funds on the same day to maintain balance in the position (followed by a few days of letting the stock price fluctuate and fall, allowing others to circulate chip funds, and the main force continuing to implement bottom torture tactics). On the graph, there is a large amount of long shadow or long shadow, and the main flow of funds is from individual investors to individual investors. Some of the long forces involved are short-term investors, while the ones who are eliminated are desperate trapped in the stock.
In the main fund reconnaissance battle, the main focus is on preserving strength and observing the significant gap in power between long and short positions. Its biggest ally is the investors who have long been trapped in the stock, while the enemy is those investors with poor holding mentality. But no one can dance with the main force at the bottom, mainly because most investors do not have the patience and perseverance to endure this bottom torment.
Main Fund Boosting Battle
After using reconnaissance warfare to observe the market multiple times, the main force has basically understood the overall situation of the market. After knowing how many chips are illiquid, they also understand how many forces will compete with it for wealth. Before the rally, the main force had basically deployed their positions, and it can be said that the next stock trend chart has been drawn in advance, and the plan will only be modified when encountering major fluctuations. Chips are weapons, funds are soldiers, and the fierce and rapid chip gold exchange - the battle of raising prices - has begun.
Boosting strategy: Rapid Boosting.
The main force's orders are knocked up, showing an arrogant attitude every day, quickly raising prices, creating short-term profit effects, attracting more short-term customers to buy and sell, and allowing for the exchange of chips and funds between short-term customers. In this process, the main task of the main force is to use their own funds and chips to circulate and make the chips appreciate in the rising stock price. Frequent buying and selling by short-term investors can save the consumption of main force funds and relieve the pressure of profit taking during the rise.
High daily stock price increases and limit up restrictions are the main techniques used in the rally, with the main force striving to achieve a seamless and rapid rise in stock prices away from the cost zone, either by increasing volume or decreasing volume. There are two reasons for the massive increase in volume: firstly, the main players heavily compete with their own chips, creating the direction of market hot money movement and attracting the attention of short-term investors; Secondly, the main source of transactions comes from the exchange of chips between short-term traders, allowing them to be the main force in advertising and attracting the next batch of short-term traders to enter the market. Shrinking and rising represents a very reliable lock in of chips, with the entire stock group being one-sided, and the main force can almost completely dominate the entire market. With this unanimous optimism, a few trades can boost the stock price.
