Thursday, 22 March 2012

Article by Hu Li Yang: 10 Ways to Sell a Stock


1When the Stock has a sudden surge in volume, there isn’t any bigger volume coming up for the next 10 days

2The sector no. 1 and no. 2 stock starts to become weak. eg: Big fall for 3 consecutive days or 4/5 days drop
This is the sign that the sector is turning weak
 
3Stock price open high and going lower for 2 consecutive days. The day ends with at lowest point.
(Stock price open high and dropping for 2 days indicates a lot of people are waiting to short. If stock price ends 2nd day at lowest point indicates Bulls lost the battle)

4When stock moves up by more than 30%, then 10 day Moving Average starts to turn down.
(When stock increase by >30%, consolidation can happen anytime. If 10day MA turns down, stock trend may stop)

5A sudden big volume on a day. Stock price ends at lowest or having an inverted hammer with a long tail
(When sudden volume surge with falling price normally indicates Big players are leaving, price is shaking)

6A surge in volume for a single week, price starts to go weak for 2 consecutive days
(Weekly volume represents short term momentum of stocks. When the momentum is at its highest point, and yet  stock price drops, it means people are leaving, short term “party” is over.)

7For the week, the stock swings wildly, but ends at the lowest point
(Violent swing represents a strong battle of bulls and bears, when price ends at lowest means that bulls have lost the battle.)

8Stock price falls more than 20% swiftly from the highest point.
(Stock price dropping more than 20% often means mid term consolidation, consolidation duration must be longer)


9Stock price has a double top pattern, with the right top less than the left. Then it falls below the neckline.
(Head and shoulder, Multiple Top and Double Top are 3 patterns that shows falling of price. Among them, double top is the most common these 5 years)

10When a stock breaks a box pattern to the downside. When in a box, it has a pattern. Once a box bottom is broken, tendency of going down is strong

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