Learning one knowledge point every day, let's explore an important phenomenon in the relationship between volume and price: Why is there a high probability that the market will continue to rise after a shrinking rise?

The shrinking rise reflects the consensus of most investors or dealers in the market, that is, they have a strong and consistent willingness to buy stock prices or assets. In this case, the influx of large funds from dealers shows that they want to push prices up, not just to ship quickly.

The profit method of dealers lies mainly in subsequent market behavior. They induce retail investors to continue buying by creating opportunities for rising prices, thereby pushing up prices. In this process, dealers may increase funds again to strengthen the atmosphere of market rise and further consolidate retail investors' confidence in chasing up. Once the market reaches a certain height, dealers will gradually start to ship, leaving it to retail investors who can't keep up with the trend to take over.

Therefore, the core reason why the market may continue to rise after a shrinking rise is that this situation usually occurs when the asset is in the new low start-up stage. In this case, the market's buying power is strong, while the selling power is relatively weak, pushing prices further up.

However, it should be noted that if the market is at the absolute end of shipment or is already at the overheated parabolic high stage, the sudden increase in volume may be more of a lure to buy, and may face higher risks. Therefore, analyzing the market stage and the relationship between volume and price is one of the key factors in judging market trends and risks.

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