Du Yucheng pondered for a while, nodded and said, "You have a lot of sense, but I have studied many stocks, and the opportunity for this perfect resonance is too difficult to find." For example, the Baotou steel rare earth you just said, obviously fell by more than two-thirds in the big bear market, and now it is obvious that the bottom has just started, but because the response of the monthly line is too slow, and the reaction of the daily and hourly lines is too fast, if you want to wait until they form a technical resonance with the weekly line, the stock price may have doubled at that time. What do you do with this kind of stock that doesn't form a resonance? Do you give up, or do you want to find another way? ”

"Find another way." Ding Xu smiled and explained, "Since I can't pursue that kind of perfect indicator resonance, my solution is to retreat to the next best, look for stocks with reliable fundamentals, and use most of the indicators to form resonance as the technical basis for assisting stock selection." ”

"Oh, tell me more about it." Du Yucheng suddenly became interested.

"First, as far as I know, almost all technical indicators have certain defects, such as a certain lag, or too sensitive response, and many technical indicators are prone to passivation, and often produce some wrong buying and selling signals, especially when the stock price continues to soar or fall sharply, especially when the stock price continues to soar or fall continuously."

Ding Xu replied, "Therefore, sometimes the rebound and reversal signals judged according to technical indicators are prone to errors, which is often caused by the passivation of technical indicators, especially when the stock price has a top divergence or a bottom divergence, its sensitivity and reliability are worse." In addition, the market maker can often use funds to control the fluctuation of the stock price, and can make pre-designed technical indicators, including false breakthroughs, etc., retail investors are easily deceived by the market maker. That being the case. I'm mainly focused on fundamental analysis. Technical analysis is complementary. This way it is not easy to make mistakes. After all, the fundamentals are relatively real, as long as you have the ability and vision to think independently, you are generally not easy to be deceived by the main force. ”

You're right, there are thousands of known technical indicators, almost all of which use the principle of moving averages. For example, indicators such as KDJ and R private basically use a short-term fast moving average, and cross up or down a long-term slow moving average. For buy and sell signals after the crossover of fast and slow moving averages, many technical explanations are invariably referred to as golden crosses or death crosses. The role of buying and selling tips is also tending to be the same. ”

Du Yucheng nodded and replied, "Most of these technical indicators are based on the principle of moving averages, which are similar to the series of products on the production line, and there is actually no new idea and breakthrough in prediction technology." Sometimes using ten indicators is not much different from using one. ”

"I also think so, the two indicators of KDJ and R are really similar. However, it's always good to use more indicators, right? Ding Xu nodded, feeling suddenly enlightened.

Du Yucheng shook his head and said, "Not necessarily." Last year, I made dynamic stock trading statistics on dozens of technical indicators. At the end of the day, when these indicators give a buy signal, the average probability of a rise in the stock price is only 57%. There is also a 43% probability of a decline. In other words, with or without technical indicators, the probability of rising and falling is actually about the same. This means that technical indicators are error-prone and do not effectively guide investors to invest correctly. ”

Hearing this, Ding Xu was silent for a while, then smiled and said: "The funny thing is that the tips of the buying and selling points set up by some stock trading software are added with the change of time, for example, all the high points will be marked 'sell', and all the low points will be marked 'buy'. If it's that accurate, who is going to analyze the fundamentals and the technicals? ”

"Well, all that software is a lie. What about your second point? Du Yucheng nodded and said.

"Second, in technical analysis, I mainly use the seven words of 'K-line moving average volume' as the basis for technical judgment, these seven words are the most critical things in technical indicators, and other technical indicators are basically based on these seven words, which can only be used as an auxiliary reference, and cannot be discarded. Among these auxiliary indicators, such as kdj, obv, macd, and other commonly used indicators, I use 7 of them, and the effect of each verification is relatively good, so as long as there are 4 indicators that are consistent, more than half, then I choose to believe in this kind of pointing as an auxiliary reference. Ding Xu replied.

"It looks like a bet on probability, but as I said before, most indicators are based on the principle of moving averages. So you have to pay attention to the fact that if you use the same kind of indicator, it doesn't make much sense to use more. You have to use different indicators to make your approach work well. ”

Du Yucheng smiled and said, "For example, the buying and selling CCI indicator, the trend-based MACD indicator, the energy-based CR indicator, the volume-based OBV indicator, the moving average-type EXPMA indicator, the path-type Bollinger Bands indicator, and the stop-loss SAR indicator, if most of these seven indicators point to the same result, there is some reference significance." ”

"There are so many classifications." Ding Xu sighed with some admiration, "I didn't pay much attention to these classifications, and I usually use them a little messily." ”

Du Yucheng asked again, "Do you have a third point?" ”

"Yes." Ding Xu said seriously, "Third, for the contradiction between different time periods, this problem is actually not difficult to solve. If you are buying stocks in the medium and long term, and you are ready to hold them for more than half a year, then the monthly line is the mainstay, supplemented by the weekly line, and the fluctuations of the daily line can be basically ignored. If it is a short-term stock speculation, and you are only ready to hold it for a day or two before making a profit and leaving, then you only need to focus on the line, which is enough. ”

"Well, the logic is clear, and it's a more scientific solution." Du Yucheng closed his eyes and pondered for a while, then nodded.

"For my train of thought, Mr. Du, don't you have any suggestions?" Ding Xu asked with some disappointment.

"Any idea needs to be tested by actual combat. Without further ado, you go ahead and pick stocks, and I'll watch. If there is anything to build, I will bring it up in time. Du Yucheng opened his eyes and said with a smile.

"Okay, for the rare earth stock of Baotou Steel, as I just said, it is mainly based on the fundamental stock selection method, supplemented by technical indicators. As for technical indicators, I judge its medium-term uptrend mainly from the weekly side. Today is a short-term chart, so the main consideration is the 6o minute candlestick chart. At present, the 6o minute candle maintains a good upward trend, standing above all moving averages, maintaining an intact ascending channel. ”

Ding Xu said while calling up the 6O minute K-line chart of Baotou Iron and Steel Rare Earth, "In addition, yesterday, the Shanghai Composite Index stood above 2,000 points and stood on the 6O daily line, although it rose and fell, but it still rose 1.84% at the close." The Baotou steel rare earth rose to a maximum of 8.48 yuan yesterday, an increase of nearly 7%, and then dived rapidly, closing down by a penny, significantly underperforming the market. And Baotou Steel Rare Earth broke through the 6O daily line that has never been touched in half a year yesterday, although the close did not stand up, but I feel that the two days will definitely hit the 6O daily moving average again. Yesterday's close was $7.94, while the 6o daily moving average was at $8.23 yesterday and should move down to $8.18 today. If you want to hit the 6O daily line again and stand up, you should be able to get at least O.24 yuan of profit in the short term, that is, more than 3%. ”

"The target is not high, but it is clear, and the fundamental and technical support is sufficient. I basically agree with you, the next one. Du Yucheng nodded appreciatively.

"The next stock is Qianyuan Power." Ding Xu called up the trend chart of this stock.

"Wow!" Looking at the graphics, Du Yucheng smacked his lips, shook his head and said, "In just a few trading days, three daily limits, from more than eight yuan to more than twelve yuan, an increase of 5o%, do you dare to chase such a stock?" (To be continued!)

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