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Identifying Solitary Island Reversal

2011/9/30 14:08:00 20

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Identification Of Solitary Island Inversion

When a shipwreck survivor reaches the land exhausted from the storm after the storm, he will be very excited, but if he finds himself in a lonely island, he feels quite lonely.

The island form in the stock market also has a similar feeling. The island form based on the gap theory is a strong reversal signal, and its intensity should exceed the breakthrough gap and the general reversal form. According to the different location, it can be divided into the upper Island inversion and the lower Island inversion.

The so-called upper Island inversion form refers to

Price of stock

In the rising market, it is going on.

Rise

After a period of time, there was a jump gap in some day, but then the stock price lingered for a period of time. Soon, it began to fall down in the form of a downward gap. The gap and the rising gap were near the horizontal level of the same price area, so that the region where the high position was contended was like an isolated island shape away from the coast. The gap between the two sides made the island isolated and above the ocean.

The so-called "lower Island inversion" pattern is that the stock price is in a downward trend, and after a long period of decline, a sudden drop in a certain day left a downward gap. In the next few days, the stock price fluctuated at a low level or continued to drop under the gap, but fell to a low point and suddenly began to turn back. The stock price jumped upward and began to pick up rapidly in the form of gap. The gap between the upward gap and the previous fall was near the horizontal position of the same price area, so that the low position of the contending region was like an isolated island shape away from the coast, and it became the largest empty trap created by the main force when it was smoking.

The island tends to appear in the market when it is optimistic about the stock price. It wants to buy shares but can not buy it at the expected price, while a moderate rally makes investors unable to bear the high price, so there is a rising gap.

But the stock price can not continue to rise, optimistic about the beginning of easy to change hands, but the result of short fighting can not maintain high stock prices, there is a downward gap downward.

Transition

Let's start a downward trend.

The reverse of the island is exactly the opposite.

Islands often appear at the top or bottom of long-term or medium-term sexual trends.

When the island is obviously formed during the rising process, this is to sell the flood code; conversely, if the fall occurs, it is a buy signal.

Therefore, once the island is formed, investors must make a judgement on the basis of judgement: after the appearance of the island, they should be short while the lower island should be done.

Combined with the Shanghai Composite Index before 5.19, from May 7, 1999 to May 20th, an example of island reversal was formed, and the operational skills of island inversion in actual combat were explained in detail.

1. The two gaps before and after forming an island are usually at the same level.

At the same time, the island begins with exhaustion and breaks through the gap. It often fills gaps with gaps in graphics, so the gap has been completely or partly filled.

The Shanghai Composite Index left a nearly ten point 1117-1107 down in May 10, 1999, leaving a 1109-1113 breakthrough gap of four points in May 20th, and two gaps all around 1110 points. The 1109-1113 breakthrough has already partially filled up the downward trend of 1117-1107, so the island reversal has been established, and a big bull market is about to start.

2, the gap before the island shape is exhausted, and then the gap in the opposite direction moves to break through the gap.

For example, the gap before the island is exhausted by the exhaustion of all kinds of forces, and then the gap will start to break down the gap leading to the market for the empty side. The first gap in the lower island shape is the downward gap in the depletion of the empty power, and the last gap will be a breakthrough for the multilateral counteroffensive.

In the lower Island reversal of the Shanghai Composite Index before 5.19, the 1117-1107 gap is downward, and the 1109-1113 gap is a breakthrough gap.

3, during the upturn of the island formation, the volume of turnover was huge, because the two sides exchanged lots of hands during this period, but in the end they became the biggest trap of multi head manufacturing, while there was no demand for volume when the island was reversed.

The Shanghai composite index meets the requirement after 5.19 Island upside down.

4, the two gap is shorter than one day, and it may take several days to several weeks.

In a short period of time, if there is an island reversal within one or two days, it often appears together with the typical K-line combination, such as wearing a broken head, a Twilight star, a star in the morning, etc. over a long period of time, an island reversal occurs in a few weeks, often combined with other typical forms, such as head shoulder shape, dome (bottom), flat top (bottom) and so on.

The top of the upper Island inversion is generally a relatively flat area, which is in sharp contrast to the steep graphics on both sides. Sometimes the top is just a trading day with the amount of days, which is the product of extreme emotional market.

Such as the ST River in June 19 and 20, 2003 formed a breakthrough from the K-line combination, and in June 19th formed an upward gap. In June 23rd, it formed a downward breakthrough gap, which is typical of the Kamishima Gata inversion accompanying the K-line combination.

5, the best selling point of island shape is to break down the ascending or descending trend line and the second gap, because before that, the direction of development can not be determined, and once the form is established, we must quickly cut the Gordian knot, and resolutely do more or shorter.