Stock Selection Should Abide By Four Basic Principles.

In recent years, many retail investors feel very helpless. They have just looked at the market and hot spots. Once they buy in, the wind turns into a painful family.

People who learn the theory of Tao know that Dow has divided the trend into three categories, namely, major trends, minor trends and short term trends. The main trend is like the tide, and the secondary trend is the waves in the tides.

We do band, we need to grasp the secondary trend, also called intermediate trend.

We open the Shanghai and Shenzhen stock markets, and

Band operation requires us to buy at every inflection point of intermediate upward trend. After a certain increase, we will sell at a downward turning point in the short term.

When buying and selling, pay attention to two points: when buying up, as long as the intermediate upward trend appears, do not control the performance of the stock on that day; when selling, as long as the short term downward inflection point appears, both the profit and loss must be won or outbound at the first time.

In order to make the band operation safer, we must pay attention to and strictly abide by the four cardinal principles when selecting stocks.

First, choose only the main trend upward, and the stock that is in the ascendant channel to operate, and ignore the stock that the important trend is in the down channel; take the best time when buying; the first time when the inflection point of the intermediate upward trend has just appeared, and sell at the first time when the main trend is blocked down; the stocks that are in the low side for a long time are relatively safe to intervene at the first time when the volume is up.

Two, the market is the vane of stocks. When buying and selling, we must pay attention to the face of the big market. When the main trend and minor trend of the market are downward, it is best to stop the band operation. Indeed, there is a medium and long term upward trend. The positions of the stocks that can be purchased upward should be lighter.

When buying a big market, it is necessary to suspend this operation. However, after a big drop in a few days, you will see the opportunity to come to the band operation quickly and make more money.

Three, buy and hold only at the bottom just started, or just out of the bottom area.

Four, strive to learn the theory of technical analysis, constantly improve their analysis, judgement level and actual combat ability, and be confident enough to have a good mentality and emotional stability. Only then can you see the language that ordinary technical analysts are unable to decode from the graph, never trust the gossip and stock appraisal personnel. Only by constantly improving their trading system and raising the level of trader, can we find the golden key to open up the wealth Treasury and earn the money that we should get.