K-line chart Basic knowledge
2023-06-20
Basic knowledge of foreign exchange K-line charts: There are three types of analysis charts in the foreign exchange market: 1. Line charts, 2. K-line charts, and 3. Histograms. Among them, line charts and histograms are rarely used in practical applications, and they are only seen in some books. Pass. K-line chart is the best tool in technical analysis. Today I will explain the basics of foreign exchange K-line chart. There is a little trick to look at the foreign exchange K-line chart: "Look at the yin and yang first, then look at the entity, and finally look at the shadow line".
As the name implies, yin and yang refer to the Yang line and the Yin line. The definition of Yang line is: the closing price is higher than the opening price, which means that the multi-party is strong, and the multi-party is also called the buyer and the bull. The definition of the negative line is: the closing price is lower than the opening price, which means that the short side is strong, and the short side is also called the seller, short.
The entity refers to the price difference between the closing price and the opening price of the K-line. The larger the price difference, the stronger the power of this K-line. Therefore, in foreign exchange trading, choose the K-line with a large physical part, such as the big Yin line and the big Yang line, and the probability of successful trading will be higher.
The shadow line refers to the price difference between the highest or lowest price and the closing price of the K line. For example, the upper shadow line refers to the price difference between the highest price and the closing price. The farther the distance between the highest point and the closing price, It shows that the longer the upper shadow line, it means that the upward force is affected, and the short side counterattacks strongly.
The lower shadow line refers to the price difference between the lowest price and the closing price of the K-line. The farther the distance between the lowest price and the closing price, the longer the lower shadow line, which means that the downward force is blocked, and the multi-party counterattack is strong. Therefore, in foreign exchange trading, if you see that the upper shadow line of the K line is too long, you cannot place long orders, and if you see that the lower shadow line of the K line is too long, you cannot place short orders.
In the later stage of the downtrend, if the lower shadow line of the K line is particularly long, it means that the bulls have a strong counterattack force, and we can go long. We can go short.
The basic knowledge of foreign exchange K-line charts must be firmly grasped, and they will be used skillfully in future transactions. I hope that foreign exchange investors will pay more attention to observing K-line charts, especially pay attention to the adjustment form composed of multiple K-lines. After a long time, These forms are naturally imprinted in the mind and remain in the heart.