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Three Reasons To Trigger A Violent Red Monday

2011/8/6 15:56:00 40

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On Friday, A shares were struck by the long line of Dow Jones -512, which is expected to build a double bottom above 2610.

A shares

The empty main force exploded, creating a new low of 2605.14, leaving more than 30 gaps in the K-line pattern.

So how to locate this gap?

The author thinks that this gap has three important meanings:

1) breakthrough gap: we know that A shares have formed two land level levels on Thursday and Monday, respectively, 66 billion 500 million and 69 billion 300 million respectively.

The author once said that if there is no substantial loss, it is difficult to break through the 2610 point.

And the Dow Jones huge drop made 2610 fall apart.

So in this sense, this gap is a breakthrough gap, because the 2610 - 2650 stable chip area is broken down by the main force of the empty team and sent.

2) relay gap: why is it a relay gap?

First, according to the traditional "three gap theory" of the gap, if the gap between 2763 and 2759 formed by the big Yin line on the 7.25 th -82 point is three wave C as the breakthrough gap, then the 8.5 day gap will be regarded as the relay gap.

3) the observational gap: the July economic data released in August 9th, and CPI became the focus of the market.

If the central bank chooses to raise interest rates, the market will probably form the third gap of the three wave C, the exhaustion gap.

A shares

The possibility of bottoming out is very great.

One is the turning point of CPI, and the two is the release of Dow Jones's failure.

If the central bank has not chosen to raise interest rates, the market is likely to launch a retaliatory counterattack, and the third gap will hardly be established.

So this is why I see this gap as an observational gap.

The above is the author's technical positioning for the gap.

So for the short term Monday trend, I think there are three reasons for triggering red Monday.

The reasons are:

1) Dow Jones volume rebounded sharply: the Dow's Yilian Yin and -512 giant Yin line led to a short-term drop of 12.6%.

Therefore, Friday night's heavy volume rebound means that the Dow Jones mid-term adjustment has entered a short-term repair period, which will undoubtedly give A shares a respite and long wait for a counterattack.

2) the short-term drop is huge: first, there are technical amendments, especially for the authenticity of the gap.

If the main force restores the gap, it means that the strength of the bull can not be ignored. If the compensation fails, it will be beneficial to the bull, because if there is a gap in the interest rate, the bear power will quickly fail.

The two is that the bottom of the big market deviates from the bottom of the weighted blue chip stock, which deviates from the implied impulse power.

The three is the traction of deviant rate.

3) the policy side releases the signal: first, the central bank has invested three weeks in a row for three consecutive weeks; two, the securities and Futures Commission has put forward the plan for the central bank to release the signal of stability and stability for a long time.

So on Monday, the market is likely to go downhill and start behind.

rebound

Action, take out the shade line, make red Monday.