Hexun Investment Advisor Xu Xinyuan: If you don't understand these 9 sentences, I suggest you not to trade stocks first!

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To avoid pitfalls in the stock market and improve your winning rate, remember these 9 iron rules today. They will help you avoid 90% of the traps and can be applied immediately after listening.

First, six things not to buy. Remember these 6 phrases to buy at the right time.

  1. Never buy after a sharp rise. When the weekly chart peaks, the main players have taken profits and withdrawn. The tail-line pattern is full of risks. Don’t hold onto illusions; if you’re late, you’ll get caught.

  2. Never buy during sideways consolidation at high levels. Remember, prolonged sideways movement usually leads to a decline. If the main players want to push higher, they would have already moved away from the cost zone. Such sideways trading is just distribution.

  3. Don’t buy when there’s high volume but no price increase. A sudden surge in volume at high levels without a price rise isn’t a sign of turnover; it’s the main players dumping shares amid the noise. Retail investors, don’t join the frenzy.

  4. Don’t buy when the price breaks down. When the trendline breaks, the support level falls, and the bulls’ defense collapses, it’s time to be cautious. There might still be a bottom below.

  5. Don’t buy stocks with no volume. If daily trading is sparse and the chart looks flat, the market has forgotten about it. Without funds, there’s no trend. Don’t waste your time.

  6. Don’t buy when the moving averages are in a bearish alignment. When the 5-day, 10-day, and 20-day moving averages all turn downward, the decline is clear. Entering now is just toughing it out. Any rebound is a chance to escape.

Next, three things not to sell. Knowing when to sell makes you a master; selling at the wrong time can turn gains into losses.

  1. Don’t sell during a bottom sideways consolidation. When no one is paying attention, it’s the main players quietly accumulating. The longer it lasts, the stronger the future breakout. Don’t hold out until you can’t anymore—sell early.

  2. Don’t sell during a pullback to the moving averages. As long as the stock’s trend remains upward, a pullback to the 5-day or 10-day line is just a breather. As long as the bullish pattern isn’t broken, don’t be shaken out.

  3. Don’t sell during volume-driven upward moves. When volume and price rise together, it’s a sign that the main players are actively buying. Hold steady and don’t rush to take profits. Keep some positions for the next move.

These 9 rules are not slogans—they are the fundamental logic of the stock market. Less impulsiveness and more discipline will, over time, improve your success rate.

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