The analysis and judgment of market trends is a long-term and large-scale topic. Duan Chenbei only makes a brief analysis of the pauses and turning points that occur.
The trend pause law and turning point rule are detailed technical operation rules for market research and judgment. They are important technical principles for judging the turning points or reversal points of wave trends and involve trading decisions on specific buying and selling points.
The trend pause law states: "The trend in the same band runs smoothly. Once a pause occurs, it is the first signal of trend adjustment or reversal."
The indicator-based technical rules mainly determine the turning point (or reversal point) of the first-level band through the golden cross and dead cross of the indicator curve and other related types of signals. Its essence is to determine the change of trend through the comparison of the statistical principles of indicator-based technology and technical status.
The ultimate goal of the trend pause law and indicator-based technology is exactly the same. It's just that the methods and technical perspectives used are completely different. It can be said that the market structure theory is more sensitive and effective in judging micro turning points than ordinary indicator-based technology. This conclusion is entirely determined by their completely different technical principles.
What is the basic principle of the law of trend pause? The "market structure theory" describes it as follows:
The operation of trends follows the law of balance, which is reflected in the uniform rhythm of the trend in pursuit of balance. This is also the manifestation of the law of trend inertia. The balance of trend operation is reflected in the smoothness of trend operation. The smoothness of trend operation is specifically manifested as: continuous, uniform, uninterrupted and stable trend movement.
According to the law of market balance and the law of trend speed change, the trend will show a speed change during its operation. This change in speed is a manifestation of the market losing balance. There are two main forms of changes in trend speed: trend acceleration and trend deceleration.
Trend acceleration is a strong signal of the continuation of the original trend, while trend deceleration is a sign of trend adjustment or reversal. The pause in the trend of the same band is trend deceleration, which means adjustment or reversal of the trend band.
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