In the stock market, investors will give different names to technical forms of K-lines with different characteristics based on the trends of the market or stocks. These technical graphics with characteristic names also have different reference signals.
What is the K-line suspension neck shape?
Firstly, the hanging neck candlestick chart is composed of three candlesticks and serves as a warning signal for the risk of bearish selling points in the market or stock market. Usually, the first candlestick is in a continuous upward trend, forming a bullish candlestick. The second candlestick is a star shaped candlestick chart (with a narrow gap between the opening and closing prices) with small fluctuations, showing a partial gap and upward trend. The physical part is relatively short, and there is not much room for intraday gains. The third candlestick is a relatively large bearish or bearish candlestick.
When a hanging neck K-line technical pattern appears, there is usually a lot of bullish power on the first trading day of the K-line, causing the market or stock prices to gradually rise. The bullish power that appeared on the second candlestick trading day gradually decreased, and the buyer's funds were relatively small. However, some sell orders in the market caused a small drop in price fluctuations, and the long and short positions were in a game stage. On the third candlestick trading day, there was weak bullish buying and bearish selling on the market or stocks, which exerted pressure on the market or stock prices. This situation indicates that the bullish funds in the market are gradually declining, and bearish selling is gaining dominance in the market, which can serve as a short-term selling point risk warning signal.
During the reference process, investors usually experience a continuous upward trend in the K-line combination chart of the hanging neck line, with no significant decline in the early stage. In the second candlestick, the opening and closing prices will be higher than the effective closing price of the first day, and the closing price of the third candlestick will fall by more than half of the first day's increase. At the same time, the reversal of the hanging neck line will be accompanied by a significant decrease in trading volume.
Overall, the hanging neck K-line combination chart is a warning signal for the risk of bearish selling points in the market. However, investors should be aware that there are no perfect technical indicators and technical graphics in the market, and there may be some misleading information. I don't think blindly trading based on similar technical graphics, but it is necessary to refer to other indicators, market environment, and individual stock situations.