During the New Year, let's talk about something practical, and I hope everyone can grow in terms of cognition.
We often hear a term called "blood-stained chips".
However, many people actually do not understand what blood-stained chips are and how they are stained with blood.
Old stock investors know that blood-stained chips are actually the stop-loss chips when cutting losses.
For example, if you buy at 10 yuan and sell at 5 yuan, the chips are blood-stained.
If the stock market is imagined as a zero-sum game, then blood-stained chips are the key to making money.
If you don't sell the chips, even if you are floating at a loss, the opponent can't make money.
Because the essence of making money lies in the transaction of chips, in high selling and low buying.
So the key and protagonist of this game lie in the low-priced chips and the high-positioned take-over guys.
Today, I will briefly analyze how the main force gets blood-stained chips at a low price in the game.As for how the main force deceives the "bag-holder" at high positions, we will talk about it next time.
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To obtain chips, there are usually three methods.
The first method is to release bearish news.
This method is the most common, and most of them are pre-arranged between the main force and the listed company.
There is no wall that cannot be penetrated by the wind, and the announcement of bearish news by the listed company is actually the final shoe dropping.
Before that, the funds that should have run have mostly run away, just waiting for the bearish news to hit the market and pick up cheap chips.
After retail investors learn about the bearish news, they often flee in panic.
Especially some performance bearish news, which can even trigger panic among institutional investors.
When the stock price has fallen to a certain extent, if there is a bearish sell-off, it is basically a bear trap.The vast majority of the main forces actually have a relationship with the listed companies, and they already know in advance whether the performance is good or bad. They also have a clear memory of some other significant bearish news.
Therefore, using bearish news to suppress the stock price is the best way to make some investors stop their losses.
Once the stop loss is triggered, the chips naturally fall into their hands, and they are passively received at a low price.
The second method is to create panic.
This technique is actually quite simple and crude, but retail investors are very susceptible to it.
The reason for this is that panic itself is a human nature.
Creating panic does not require bearish news; it only requires a decline.
In the early stages of the decline, most retail investors do not understand the situation and will replenish their positions if they have money.
However, if the stock price continues to fall uncontrollably, retail investors will start to suspect and look for reasons.
Why is it falling? What is the reason?At this point, even if the main force does not take action, rumors will naturally emerge.
Creating panic only requires creating chaos in the technical pattern. Naturally, an ugly pattern will make retail investors leave the market.
Many stocks are lured to sell due to technical breakdowns, and in the end, the chips are smoothly returned to the main force.
It has to be said that some golden pits are actually created under panic.
The third type, forced liquidation.
The last method is actually the most violent, which is forced liquidation.
If one can see the cost of the other party's chips, one can deduce how much the price needs to drop to trigger forced liquidation.
The vast majority of capital will use some leverage when building positions, which gives capital the method to harvest.
As long as the long positions can be blown up, one can get the long positions with blood on them.
Nowadays, the financing ratio is relatively low, and the leverage ratio is not high. To reach the liquidation point, at least a 50% cut is needed.But some private equity is different, including Snowball, with 20-30%, it can easily trigger a forced liquidation of positions.
This method is actually the best manifestation of the bloodthirsty nature of capital, with no regard for sentiment, it is aimed at forcing a liquidation of your positions.
Most of the long positions, due to optimism about the market, tend to hold a large number of positions and a small amount of cash.
If the short sellers can use some tools such as short selling to forcibly drive down the stock price, once the long positions run out of ammunition, they are completely likely to face a forced liquidation.
Once the long positions are liquidated, it means that cheap chips will come out, and the short sellers can take the opportunity to aggressively cover their positions.
This simple and crude method, for multi-party funds with leverage, is simply perfect.
If it can take advantage of bad news and panic, it will further push the wave and achieve better results.
The above three methods are actually the common forms used by short sellers, to harvest chips in this way, to ensure that they get cheap chips.
Everyone must have a question, why in the foreign market, there is a long bull trend, there is no capital to short sell, is it that they do not harvest chips?In fact, the situation is not as it seems.
The most significant feature of the overseas market is its openness, embracing all rivers.
There is a key point you must remember: the capital in the A-share market is essentially obedient.
Obedience implies that everyone will respect the choices of capital.
To put it more bluntly, there are few opponents, and one party dominates.
In this situation, it is actually very simple to harvest chips.
Unlike some mature markets, there are too many funds involved. You are desperately trying to short and harvest chips, but when you encounter an opponent who is long, they will take all your short positions.
The game in mature markets is more rational, while the game in the A-share market is completely different, tending to monopolize the market.
Under the premise of confirming the distribution of opponents' chips and the price of explosion, use market and capital advantages to take the chips into the bag.
The specific operation method is not difficult either.Expand the extent of the bearish sentiment, then find reasons, find funds to take the blame, and then pick up the cheap chips that have fallen everywhere.
The way of capital, seemingly very complicated, is actually very simple in essence.
In the cycle, use the advantage of funds to continuously sell, create panic and public opinion, and then gradually take back at a low position.
Usually, the cycle of high-position selling lasts for a few days, and then wait for the stock price to fall back to the floor price before starting to bottom fish in batches.
Nowadays, the media is too developed, which leads to some short-selling statements spreading very quickly, and it is easy to harvest chips at a relatively low position, and retail investors simply can't hold on.
In addition to some retail investors choosing to lie flat completely, most can't stand the endless decline and will choose to cut their losses and leave.
The more the cut-loss plate, the more severe the market will be trampled, and the low point of the stock price will be lower.
The more chips the main force can get in the bottom area, the greater the rebound strength will naturally be, and it may even reverse.
Because when the chips return to the hands of the capital, the way of playing will be different.
At this time, capital can no longer make money by short selling, so they have to turn over and try to raise the price of the chips, to reflect its so-called value, in order to sell a good price.This market is just so wonderful, the positions of bulls and bears can switch at any moment.
But none of this matters, because in the end, whether you make money depends on whether you can discern the intentions of capital.
If you can discern it, just keep up with the rhythm and you're done.
If you can't keep up, then it's better not to get on the pirate ship, at least you can seek a peaceful landing.
The capital market does not tolerate indecision and hesitation, everything is ultimately fleeting.
In the end, the side with a large number of chips in hand is the real big winner, capable of a clean sweep.
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