"So?" Dong Qiangqiang took a sip of Golden Baker, "What indicators are you looking at now?"
"First I will look at the Bollinger Bands of a stock." Duanmu clicked twice on the browser on the computer, but when the browser opened it showed a blank page, "I forgot to connect the network cable. Do you have Internet access here?" Duanmu He lowered his head and found the network cable port in the kitchen.
"Wait a minute." Dong Qiangqiang put the beer on the table and walked out of the kitchen. After a while, he walked in with a crystal port of a long network cable in his hand and threw it on the table.
After connecting to the Internet, the browser page slowly opened, and the beautiful K-line chart and stock price of Volkswagen stock appeared in front of them.
"There is a very magical thing about the German stock market that you would never expect. Unlike Asia and North America, they do not have the kind of brokerage institutions we commonly see in China, so there are no free stock trading and chart viewing software available. There are many free broadcasts The stock prices on stock information platforms are lagging behind by 15 minutes, so you need to leave some margin in the transaction price when placing an order. I heard that some platforms can provide real-time stock prices, but the cost is not low. I haven’t paid for it yet and tried it. ." Duanmu lowered his head and took out an A4-sized notebook from his schoolbag. After turning the page, a stock K-line chart appeared in front of Dong Qiangqiang.
Dong Qiangqiang saw at a glance that the K-line chart on the notebook was exactly the same as the K-line chart of the Volkswagen stock on the computer: "Did you draw this?"
"The yellow line above the K-line chart is the Bollinger Band, as are the purple line below and the dotted line in the middle." Duanmu said it directly without waiting for Dong Qiangqiang to ask. He drank beer and looked at Dong Qiangqiang, "You What do these three Bollinger Bands look like?”
"It looks like a channel." Dong Qiangqiang tilted his head and looked at it for a while, "The K-line chart you drew has been moving up and down within the Bollinger Bands."
"Yes, the Bollinger Bands are like a highway, and the K-line is like a car speeding along it."
"Is these three lines enough?" Dong Qiangqiang looked suspicious.
Duanmu laughed: "n, n, n. This is just the first indicator. But don't underestimate these three lines. It allows us to see the trajectory of the stock price. I calculated these lines one by one based on the formula. Values and then connected lines. You won’t find that on those free stock information websites.”
"What's the next step?" Dong Qiangqiang had never been exposed to this kind of thing when he was trading stocks before. Hearing Duanmu's explanation seemed very interesting, and he couldn't help but become more interested.
"The next indicator is a heavyweight," Duanmu smiled mysteriously, "It's called ri."
"What is that?" Dong Qiangqiang wrote three letters on the napkin in confusion.
"Its full name is retive strength index, which is translated into Chinese as relative strength index. It was first used in the futures market of the United States. Its curve is based on the number of points and rise in price of a stock within a certain period of time, such as 7 days or 14 days. It is drawn as a ratio of the sum of falling points. It is a very useful overbought and oversold indicator and is very suitable for short-term trading, especially for t0 stock markets like Germany."
"T0 means that you can buy and then sell the same stock on the same day, right?" Dong Qiangqiang had just finished a lot of stock knowledge and quickly learned to sell now, "But what are the overbought and oversold indicators?"
"First take a look at the RI chart I drew of the previous stock price of Volkswagen stock. What did you find?" Duanmu proudly turned the notebook to the next page. Dong Qiangqiang saw a curve that kept moving up and down between 0 and 100.
"Well, this line always changes between 0 and 1?"
"According to the theory of the Relative Strength Index, the ri value of a stock price will always fluctuate between 0 and 1. Most of the time, the ri value will be between 30 and 70, but did you look here, here, and here?" Duanmu said while pointing to the three red circles he marked on the ri line.
"The ri values of these three places are all below 10." Dong Qiangqiang quickly found what the three red circles have in common.
"Then take a look at the changes in the ri value after the red circle." Duanmu prompted.
"After the first red circle, ri slowly... returned to 30? After the second red circle, ri returned to 70? After the third red circle, my God, this ri actually rushed to 90?" Dong Qiangqiang felt Unbelievable.
"According to its theory, if the ri value exceeds 80, it means that the market has reached overbought, which means that investors need to be careful that the stock price will fall back at any time. But once the stock price trades sideways below 30, it may even continue to languish below 10 , beware of a sudden strong price rebound.”
"But when I was speculating in stocks in China, I kept hearing people say, 'It will fall if it lasts for a long time.' Will it not be the same this day?" Dong Qiangqiang questioned.
"People say that the high level will fall for a long time," Duanmu explained with a smile, "and the second half of the sentence, the low level will rise for a long time. What I understand about this high level is that the ri value is always higher than 70 or even 80, and the low level is ri The value is consistently below 10."
"So this is a technical indicator that can help us quickly judge whether it is suitable to buy stocks immediately, right?" Dong Qiangqiang looked at Duanmu, who was confident, and asked with a smile, "And this is the stock price of Volkswagen in the past few weeks, and the curve of the last 14 days. Have you already drawn the picture?"
Duanmu laughed and turned another page. Sure enough, the picture had been drawn long ago.
Dong Qiangqiang saw at a glance that the recent ri value of Volkswagen's stock price was fluctuating around 20, and he couldn't help but feel shocked. He pointed at the picture with his finger, looked at Duanmu and said ecstatically: "Is now the time to buy?"
"Any technical indicator is imperfect and has a certain degree of deception," Duanmu suddenly changed the subject, "ri is no exception. Just looking at it is not enough."
"Huh?" Talking about being so lively turns out to be a useless indicator? Dong Qiangqiang took a sip of wine and almost sprayed it on his notebook.
"The ri value is calculated using the opening price and closing price. If the stock's trading price rises or falls sharply on the previous day, this value will be unstable. After all, German stocks have no ceiling or circuit breaker mechanism for rise and fall. One day An increase of 100 to 500 is possible.”
Dong Qiangqiang was speechless for a moment. He knew that German stocks did not have a limit on the rise and fall of their stock prices.
“Second point, there are many factors that affect stock price changes. In addition to many normal factors, such as the recent financial situation of listed companies, product market risks, policy uncertainty, etc., there are also some random, implicit, and unquantifiable factors. Factors can affect stock prices, such as people’s expectations.”
"Is it what you said before about investors' views and judgments on a company's future?"
"Yes." Duanmu looked serious, "If a listed company's financial data is average, but it discloses some news that is in line with people's expectations, then the company's stock price may first rise and then fall. At this time, the stock price There will be hysteresis. If this is the case, simply looking at any technical indicator will be one-sided."
"Is there no other way at this time?" Based on Dong Qiangqiang's understanding of Duanmu, he believed that Duanmu must have the answer.
"Hehe," Duanmu smiled secretly, raised his head and drank all the beer in the bottle, "One more bottle."
(Special thanks for this chapter: Zhao’s clan members and Sharalang’s recommendation votes)
