How to read the K-line chart in Great Wisdom

Also known as the daily K-line, it originated in Japan. The K line is a columnar line composed of shadow lines and entities. The part of the shadow above the entity is called the upper shadow, and the part below it is called the lower shadow. The entity is divided into two types: Yang line and Yin line, also known as red (Yang) line and black (Yin) line. The record of a K-line is the price change of a certain stock in one day. The K-line graphically represents the increase, decrease, transformation process and actual results of the power of buyers and sellers. After nearly a hundred years of use and improvement, K-line theory has been widely accepted by investors.

· When the closing price is higher than the opening price, the real part is generally drawn in red or blank, called a "yang line"

· When the closing price is lower than the opening price, the real part Generally drawn in green or black, it is called the "yin line"

History

The K line is also called the Yin and Yang candle. It is said to have originated from the rice market in Japan in the 18th century. Rice merchants were used to express changes in rice prices, and were later cited in the securities market and became a theory of stock technical analysis. The K line is a columnar line composed of shadow lines and entities. The part of the shadow above the entity is called the upper shadow, and the part below it is called the lower shadow. The entity is divided into positive line and negative line. The shadow line indicates the highest and lowest trading price of the day, while the body indicates the opening and closing price of the day.

K-line chart

A K-line records the price changes of a stock within a day. Arranging the daily K-lines in chronological order forms the historical changes in stock prices, which is called a K-line chart.

Price composition

The K-line consists of four price levels: opening price, closing price, highest price, and lowest price. The opening price is lower than the closing price, which is called the positive line, and vice versa is called the negative line. The rectangle in the middle is called the entity, the thin line above the entity is called the upper shadow, and the thin line below the entity is called the lower shadow. K-line can be divided into daily K-line, weekly K-line, and monthly K-line. In dynamic stock analysis software, minute-line and hourly-line are also commonly used. K-line is a special market language, and different forms have different meanings.

K-line drawing method

With the trading time as the abscissa and the price as the ordinate, draw the daily K-line continuously to form a K-line chart

The bars in the K-line chart are divided into positive lines and negative lines. Generally, red cylinders are used to represent positive lines, and black cylinders are used to represent negative lines.

If the closing price during the time period represented by the column is higher than the opening price, that is, the stock price rises, the column will be drawn in red, otherwise it will be drawn in black. If the opening price is exactly equal to the closing price, a cross is formed.

Classification of K lines

K lines can be divided into three types: positive line, negative line and same price line. The Yang line refers to the K line with the closing price higher than the opening price. The Yang line can be divided into big Yang line, medium Yang line and small Yang line according to its physical size. The Yin line refers to the K line whose closing price is lower than the opening price. The Yin line can also be divided into large bright line, medium Yin line and small Yin line according to its physical size. The same price line refers to a special form of K-line in which the closing price is equal to the opening price and the two are at the same price. The same price line is often expressed in a "ten" shape and a T' shape, so it is also called a cross line or a T word line. The same price line can be divided into long cross lines, cross lines and T-shaped lines, inverted T-shaped lines, one-shaped lines, etc. according to the length and presence of upper and lower shadow lines.

K-line can be divided into daily K-line, weekly K-line, monthly K-line and annual K-line in terms of time, and the trading time within a day is divided into several equal parts, such as 5-minute K-line, 15-minute K-line, 30-minute K-line, 60-minute K-line, etc. These K dollars have different functions. For example. The daily K-line (that is, a K-line that we often see in securities newspapers and magazines) reflects the short-term trend of stock prices. The weekly K-line, monthly K-line, and annual K-line reflect the mid- to long-term trend of the stock price. The 5-minute K-line, 15-minute K-line, 30-minute K-line, and 60-minute K-line reflect the ultra-short-term trend of the stock price. As for the weekly K-line, monthly K-line, annual K-line, as well as the 5-minute K-line, 15-minute K-line, 30-minute K-line, and 60-minute K-line, the drawing methods are the same as the daily K-line drawing method, that is, taking a certain The opening price, closing price, highest price, and lowest price of a period are plotted.

For example, for the weekly K-line, as long as you find Monday's opening price, Friday's closing price, and the highest and lowest prices of the week, you can draw it. Nowadays, computer stock market software has become very popular. No matter what kind of K-line, it is very convenient. It no longer requires manual drawing. But as a person in the stock market, you must understand the principles and methods of drawing lines, which is very useful for judging the trend of the stock market and buying and selling stocks. This is just like calculators can easily replace manual calculations, but as a modern person, you must understand the general principles of digital calculations, and the principle of the method is the same.

The meaning of K line

The information contained in K line is extremely rich. As far as a single K-line is concerned, generally the entities of the upper shadow line and the negative line represent the downward pressure on the stock price, while the entities of the lower shadow line and the positive line represent the upward force of the stock price; the longer the upper shadow line and the lower entity of the negative line indicate the strength of the stock price. The downward momentum is relatively large, and the lower shadow line and the positive line entity are longer, indicating that the stock's upward momentum is relatively strong. If multiple K lines are combined together according to different rules, different K line combinations will be formed. The information contained in such a K-line form is even richer. For example, the appearance of a dark cloud cover K-line combination during an uptrend indicates that the uptrend may have ended, and investors should leave the market as soon as possible; the appearance of a dawn K-line combination during a downtrend indicates that the stock price may have bottomed out and rebounded, and investors should seize the opportunity. Build a position on dips. It can be seen that various K-line forms are constantly sending out buying and selling signals to people with the information they contain, providing great help for investors to see the general trend and buy and sell stocks correctly, thus making it a An extremely practical trading tool in the hands of investors.

K-line combination theory

The K-line chart contains rich Eastern philosophical ideas, and uses the changes of yin and yang to show the mutual conversion of the "potential" of the long and short parties. A single K-line represents the result of the battle between the long and short parties within one day, which is not enough to reflect the continuous market changes. Only the combined map of multiple K-lines can express in more detail the transformation of the "power" of the long and short parties over a period of time. If either of the long and short parties breaks through and gains an advantage, it will form a rising or falling market, which is the so-called "imperative". And as this market continues to develop, it accumulates energy for the other party to counterattack, which is "prosperity and decline". The purpose of studying the K-line combination chart is to observe the changes in the strength and decline of the long and short forces, feel the transformation of the "trends" of both parties, follow the trend, find and participate in the bottom that is ready to go, hold on to the rising stocks that are trending, and avoid Top risk at the end of the day. The K-line chart should be used in conjunction with trading volume and moving averages. Trading volume is an expression of the energy loss during the battle between long and short parties, while the moving average is a line of defense for both parties to attack and retreat. This graphic combination is a perfect marriage of Eastern philosophy and Western statistics.