The second short-term trigger point
[Technical form]
After a period of sideways trading, the short- and medium-term moving averages (mainly the 5-day moving average, 10-day moving average, 20-day moving average, 30-day moving average and 60-day moving average) are in a highly sticky and entangled state. With the appearance of a medium-sized positive line with large volume, the short-term moving average begins to break away from the medium-term moving average and diverge upward, which is called the short-term trigger point.
[Technical meaning]
After a long period of sideways trading, the market is brewing directional choices as the short- and medium-term moving averages are entangled. The various moving averages can form a sticky state, indicating that the consolidation time of the entire market will not be too short. As the saying goes, "the longer the horizontal, the higher the vertical", the market implies sufficient profit space and time.
In the short term, there is at least 15% profit margin, and the profit margin in terms of waves. After a period of consolidation, the subsequent trend of the market often shows a large wave, and the upward space is at least 50%, or even doubling.
[Application skills]
(1) Short-term trigger point
There are two main types of relationships between moving averages: divergence and adhesion. Divergence means that all moving averages move in the same direction, and at the same time, there is a certain distance and angle between them; adhesion means that the distance and angle between the moving averages do not reach the level that promotes the development of the market, and the moving averages are entangled with each other without a clear unified direction.
When the moving averages are in a divergent state, it indicates that the market is in a trend movement. Upward divergence indicates that the trend is or will move upward, and downward divergence indicates that the trend is or will move downward. When the moving averages are in a sticky state, it indicates that the market is in a consolidation period without a clear direction.
In actual operations, we should try our best to avoid the situation where the moving averages are sticking together without an obvious trend direction, and choose to make a tentative intervention operation when the moving averages just begin to diverge upward. This buying point is called the short-term starting point.
(2) Short-term explosive power is proportional to the consolidation time
The longer the market consolidates, the greater the strength after the direction is chosen. When the market chooses an upward direction, the upward strength is positively correlated with the market consolidation time: the longer the consolidation time, the greater the upward strength and space. Conversely, the smaller.
(3) Short-term detonation requires volume support
When the currency price pulls up and the short-term moving average breaks away from the medium-term moving average and diverges upward, it needs the cooperation of volume. It must be pulled up with large volume to have short-term explosive power. Without volume, it will not pull up. Even if it does, it will only be a short-term inducement to buy, and there will not be much profit margin.
Notice
Intervening in the market in advance will face greater risks. Because when the consolidation trend ends, the market will choose a direction: up or down. The greatest certainty in the capital market is uncertainty. If the subsequent direction of the market cannot be determined, intervening in advance will have considerable risks. When the market starts to choose a direction, it will inevitably drive the moving averages in a sticky state to move upward, and each moving average will move upward in turn, forming a bullish trend with multiple moving averages diverging upward. Therefore, if you intervene when each moving average just begins to diverge upward, you can buy at the short-term detonation point, and then you can just enjoy the fun of "sitting in the sedan chair".
