KLine Analysis Lesson 21: The bearish pregnancy line of the reversal pattern

There are two types of pregnancy lines, the bullish pregnancy line and the bearish pregnancy line. This lecture will continue to introduce the bearish pregnancy line.

Recognition Rule
1）  Previously, the market was in an upward trend;
2）  First rootKThe line is the longer male line of the entity, the second oneKA line is a shorter negative line in the entity;
3）  TwoKThe top or bottom of the line can have at most one overlap, but the second female line entity is completely contained by the first male line entity.

Psychological Analysis
The market itself is in an upward trend, and the first day's positive line has strengthened the confidence of various parties, but the trading volume has not significantly increased and is in a relatively average state. The next day, the market opened low (at a price lower than the previous day's closing price), and some uncertain bulls began to sell, causing the price to continue to decline and eventually close with a negative line. However, the negative line entities did not exceed the range of the previous day's positive line entities. Faced with such a trend, some investors are skeptical about the strength of the market, especially if the trading volume starts to shrink the next day, which further indicates that the market trend may change. If the market price continues to decline on the third day, it means that the reversal of the trend has been confirmed.

Related Forms
The bearish pregnancy line is actually the first two days of the three internal decline pattern that needs to be lowered in the future.

Practical Application

2019year4month9day$ten thousand  Ke A(000002)Continuing the previous upward trend, the day closed with a large positive line and saw an increase6.36%Opening price31.01HKD, closing price32.43element(In hindsight,19The highest price of the year32.55Yuan was created on this day)Turnover29.5RMB100mn And then the next day31.85The yuan opened low and continued to weaken, closing lower2.19%Closing price31.72Yuan, trading volume17.6One billion yuan, significantly reduced compared to the previous day. The Yin line entity on the second day is completely within the physical range of the first day; On the third day, the market continued to open low and move low, confirming a reversal. Afterwards, VankeAStarting from up to down, as of9month30The daily stock price is approaching26Yuan, decrease20%about.


***Risk statement***
KLine analysis is only an indicator tool used to judge the strength of buyers and sellers in the market and market sentiment. How to identify and study is subjective to some extent. It may not be correct to judge the future market. Many fundamental investors never analyzeKChoosing to hold high-quality individual stocks for a long time has also resulted in significant returns. Please evaluate for yourself whether and how to use itKLine tool.