What is the reason for the rapid decline of stocks?

The application of K-line diagram is one of the technical schools. Let's talk to you about the reasons for the rapid decline of stocks.

In the whole process of rising, the stock price of individual stocks often rarely rises continuously, and there will always be some adjustments and declines during the period. This kind of adjustment and decline sometimes belong to short-term adjustment, sometimes long-term adjustment, and sometimes even the change of trend. Therefore, when the stock price falls, how to accurately judge the downward trend and adjustment time of individual stocks has important technical reference significance for future operations. If the judgment is wrong and the short-term adjustment is regarded as a long-term decline, you will often miss the big bull stocks; On the other hand, if the long-term trend change is regarded as a short-term decline, it will be a big loss. Therefore, the following analysis of some of the most common technical forms of decline, as a reference for investors to judge the trend.

The first is that a stock has fallen for one or two trading days after it continues to rise, so it should not be judged. As long as the stock is still in the upward channel, it should continue to watch more. This decline is only a temporary adjustment on the way up;

The second is that if the decline breaks the original track and trend, there may be several months of adjustment, but in the medium and long term, it is still optimistic. If investors have the ability to operate the band, they can make short trades, but most investors don't have this ability. Generally speaking, as long as the big bull market is not over, they will hold it all the way;

The third kind of decline is the change of trend. This decline keeps hitting new lows, and the decline is often long-term. Once quilted, it will be stuck for a long time. In case of such a decline, investors need to leave early.

From a technical point of view, the second case seems to be quite similar to the third case, which is difficult to distinguish. By the time it can be distinguished, the stock price has reached a very low level and suffered heavy losses. Here we suggest that we can judge from the extent of the decline. Generally speaking, it is difficult to judge whether to operate at the highest price or on the day when the highest price appears, so it should not be required to go out at the highest price first. For stocks that are optimistic in the medium and long term, the decline from the highest price is relatively small, and there is often a rebound, which is the technical form of bulls; The weak stocks fell sharply, but the rebound was small. The rebound of such stocks is often less than half of the decline in the rebound, which often means a change in the long-term trend. Therefore, for those stocks that have fallen sharply in the decline, but have less strength in the rebound, they should close their positions as soon as possible.

In fact, it is of great reference significance to judge the stock price trend from the weekly line, because the daily line is very short and there will be quite a lot of fraud lines, which often makes it difficult for investors to accurately grasp the short-term trend. Generally speaking, those stocks with mid-term adjustment will have the technical form of sideways box or rising triangle, but those stocks with changing trends will continue to bottom out.