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After years of navigating the stock market, you'll realize that many operations follow certain patterns. Today, I want to share 6 relatively reliable entry and exit strategies that might help you pay less tuition fees.
First, let's talk about entry opportunities. Any stock that first pulls back to the 20-day moving average is often a good entry point. Many times, this is just a shakeout by the main force, so there's no need to overpredict—just follow the trend. Another signal that is easy to overlook is a sudden surge in volume at a low price level. After adjusting for two or three days, you can generally consider following in. Don't think about perfectly bottom-fishing; missing out is worse than getting trapped.
Next, let's look at some warning signals for exiting. If a stock's turnover rate remains below 5% for three consecutive days, it indicates declining market participation, and you should consider pulling out. If the turnover rate exceeds 20% but the stock hasn't hit the daily limit-up, such volume-driven weak upward movement is dangerous. It's wiser to exit while there's still a chance. When a high-level stock shows a massive volume while still accelerating upward, you should run quickly—don't wait until the breakdown to regret.
The last point is a bit counterintuitive—high-level movements with no volume. Many people get scared and sell when they see shrinking volume, but this often indicates the main force is locking in their positions. In fact, you should hold tight to your chips.