Novice speculation spot gold must see! You must know the k-line reversal pattern!

After learning the basics of K-line, friends who are new to investment often enter into the study of K-line pattern combination analysis, and then difficulties arise.

Indeed, the morphological analysis in gold investment is a gem in the field of technical analysis. However, there are thousands of K-line combinations, which often make entry-level investors feel foggy, so the learning progress is stagnant. How can I outline and study the K-line combination in a leading way and greatly improve the efficiency?

K-line combination can be divided into two categories

Inverted form and relay form. The reversal pattern indicates that the trend has an important reversal phenomenon, and the reorganization pattern indicates that the market is consolidating. Perhaps after correcting the short-term oversold or overbought, it is still moving towards the original trend.

From the point of view of investment philosophy, the reason for the K-line reversal pattern is that it must be reversed. When it appears, it is often the best time for investors to buy or short. However, investors should note that only the K-line reversal pattern that occurs at a critical time and position has significant guiding significance for trading.

Conditions for K-line reversal

First of all, the market must have some kind of up or down trend beforehand, which is the premise of all reversal patterns. Second, the original trend is about to be changed by a strong reversal signal, such as the most important trend line being effectively broken.

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Thirdly, when the upward breakthrough is accompanied by a greater volume, the stronger the reliability. Fourth, the larger the size of the pattern, the greater the market volatility when the reversal is formed.

The size of the pattern size is distinguished from the two aspects of price fluctuations and time. The longer the brewing time, the greater the scale of the market's sharp decline when the downward breakthrough is confirmed.

Classic K-line reversal pattern

In gold investment transactions, common reversal patterns include: head and shoulders, double top and bottom, triple top and bottom, V-shaped top and bottom, dome and bottom, triangle, diamond, wedge and rectangle.

In the figure above, the top reversal pattern is used as an example, and the types of common reversal patterns are listed. Among them, investment friends need to pay attention that the red line is an important support and resistance position during the formation of the pattern, and its breakthrough situation often indicates the success and failure of the pattern.

Black line indicates that its appearance will generally only be a reversal form, while the blue line indicates that the form may be a reversal form before finishing, or it may just be a sorting form.

In summary, investors should keep in mind the essentials of various forms in the process of actual application of reverse forms for analysis, and at the same time, they cannot analyze the technical trend with a rigid and metaphysical perspective. When the pattern formation fails or turns into a continuous pattern, you should adjust your investment strategy in time, and even stop the loss if necessary.