The role of support lines and pressure lines is to prevent or temporarily prevent prices from moving in one direction. At the same time, support lines and pressure lines may completely prevent prices from changing in the original direction.
The support line, also known as the "resistance line", means that when the stock price falls near a certain price, it will be supported by the lower side, and the stock price will stop falling, and may even rise. Each point that prevents the stock price from falling is also called "support level". These points are connected to form a support line.
The pressure line, also known as the "resistance line", means that when the stock price rises near a certain price, it will be suppressed by the top, and the stock price will stop rising, or even begin to fall. Each point that prevents the stock price from rising is also called "pressure point", and connecting these points forms a pressure line.
Because the running trend of stock price is directional, the trend can be represented by a straight line, and the straight line connecting the trend direction is also called "trend line".
Usually we call the low point that rebounds upward as "support level". Below the support level, the buyer is strong enough to resist the pressure formed by the seller. The stock price stopped falling at the support level and rebounded upward. Generally speaking, a support level can be determined after the formation of the current low point that bounces upward. Usually, we refer to intervention after the stock price is supported by the downside and the price rises and falls.
The pressure level is opposite to the support level. Above it, the seller's pressure blocks the buyer's progress, so the price turns from up to down. If the support level and pressure level show a gradual rise, it is an upward trend. Connect the pressure level and support level in the rising trend to form the rising channel.
If the support position and pressure position show a gradual downward trend, it is a downward trend. Connect the pressure position and support position in the downward trend to form a downward channel.
If the support level and pressure level show a horizontal trend, it is a horizontal trend. Connect the pressure level and support level in the horizontal trend to form a horizontal channel.
Application of support line and pressure line:
1. When the rising trend line is broken, it is a shipping signal, and becomes the resistance line for later recovery. Before it is broken, before it is broken, the rising trend line is the support line for each fall.
2. When the downward trend is broken through, it is a signal of incoming goods, and becomes the support line for later decline. Before the breakthrough, the downward trend line is the resistance line of each rebound.
3. In the long-term upward trend, when there is a very high volume, it may be a signal of the end of medium-term changes, followed by a reversal trend.
4. The rise and fall of stock prices at the end of various trends have accelerated rise and fall, so the fixed point or bottom of the market trend reversal is far from the trend line
Pay attention to the following points when analyzing the support line and pressure line:
1. The strength of supporting pressure is mainly determined by stock holding cost and psychological factors;
2. If the support is broken, it will become pressure, and if the pressure is broken, it will become support;
3. If the pressure level is breached, there should be a certain amount of cooperation
