Volume and price divergence trade resumption

Leave a Comment / / muyexi

Original link: https://muyexi.im/liang-jie-bei-chi-jiao-yi-fu-pan/

AAPL

On May 23, the first two trading days of AAPL (Thursday on the 19th and Friday on the 20th) showed a divergence in volume and price: the trading volume on Friday was flat, but the K line closed the shadow line and did not continue to fall. So the whole position was opened to buy, and it rose all the way that day.

Screen-Shot-2022-07-28-at-11.47.21

On the 24th, AAPL gapped and opened lower, closed the position at a small profit, and missed the 7% rebound after that.

Bidding ASML

On July 6, ASML exploded the day before, and fell slightly by 0.8% on the day. On the 7th, ASML opened 3% higher and opened a full position to buy.

If the stock explodes in volume one day, and the trading volume is high the next day but the price does not continue to fall, it means that the sell order may be exhausted, and it is a good opportunity to hunt for the bottom.

Screen-Shot-2022-07-28-at-11.45.53

Since it is trading on the left side, pay close attention to the price action. On the 11th, it gapped and opened low, closed the position at a small profit, and missed the subsequent 20% increase.

Reflective summary:

  1. Because it is a contrarian/left-side trade, I am nervous and too sensitive to price changes. Able to identify price action, but unfamiliar with how to do it, made the same mistake twice.
  2. Looking at the volume and price to buy the bottom and grab the rebound, the stop loss should be the position tested by the explosion, and the profit should be at the upper pressure level.
  3. Due to the time difference, U.S. stocks can only be traded at the opening, and many trading opportunities are missed. If ASML enters the market at the close of trading on the 6th, and receives the increase on the 7th, the attitude of holding positions will be much better.
  4. The deviation of volume and price is suitable for small positions to test orders or enter the market in batches, so that they can hold it.

This article is reprinted from: https://muyexi.im/liang-jie-bei-chi-jiao-yi-fu-pan/
This site is for inclusion only, and the copyright belongs to the original author.

Leave a Comment