KDJ Deviation from Judgment and Dunbo Trading Skills

The divergence of the indicator is a precursor to an important trend turn. The so-called KD indicator divergence means that when the price hits a new high, its corresponding KD value does not hit a new high; or when the price hits a new low, its corresponding KD value fails to hit a new low, thus forming a clear contrast between the price position and the indicator position.

(1) The most common types of KD indicator divergences include bottom divergences and top divergences, as well as reverse bottom divergences and reverse top divergences.

A. When the price falls and keeps hitting new lows, the bottom is lower than the bottom, and the KDJ indicator does not hit a new low, the bottom is higher than the bottom, which is called the bottom divergence pattern. This means that the seller's power is gradually weakening, and the market rebound may not be too far. At this time, you should not sell, but step up buying.

Mechanism: The price has fallen while the KDJ indicator refuses to fall. The bulls in the market have shown signs and gradually formed, and the balance of bulls and bears has begun to change. Although the market is still dominated by bears, the growth of bulls in the future cannot be ignored.

B. When the price rises and hits a new high, one top is higher than the other, but the KDJ indicator does not hit a new high, but instead turns from rising to falling, one top is lower than the other, which is called the KDJ indicator and the top of the price curve (or bull deviation, referred to as the top deviation). This means that the buyer's power has gradually weakened, which is a signal of the market reversal. At this time, we should not chase after it, but choose the opportunity to sell the position we hold as soon as possible.

Mechanism: The price rises while the KDJ indicator refuses to rise, the market bear power has emerged, and the long and short power has gradually changed. Although the market is still dominated by multiple parties, the bear power will grow rapidly thereafter.

(2) Reverse bottom deviation and reverse top deviation

The price forms two bottoms (not necessarily a double bottom in the K-line pattern) and one bottom is higher than the other, while the KDJ indicator also forms two bottoms, but the latter bottom is lower than the previous bottom, forming a divergence between the two, which is called a reverse bottom divergence.

Generation mechanism: ① Generally appears after the breakthrough of the dome.

② If it appears at the top of the inverted V, special care should be taken.

The rise time is generally short and the range is not high.

D. When the price continues to rise, the KDJ indicator also rises. If the high point of the price is lower than the previous high point, the high point of the KDJ indicator is higher than the previous high point, forming a divergence between the two, which is called a reverse top divergence.

Generation mechanism: During the wave movement, the price peak is getting closer and closer, indicating that the kinetic energy supporting the price increase is getting smaller and smaller, and the price increase is naturally weak; the KDJ is getting higher and higher, and the price is required to be corrected, resulting in a reverse top deviation.

(3) Divergence from the bottom of the valley and departure from the top of the peak

E. When the price falls and keeps setting new lows, one bottom is lower than the other, but the bottom is higher than the previous bottom and lower than the previous bottom, while KDJ does not set a new low. The bottom is higher than the previous bottom and lower than the previous bottom, which is called the trough-separating pattern.

F. When the price rises and reaches a new high, one top is higher than the other, but the top is higher than the previous top and lower than the previous top, while KDJ does not reach a new high. The top is higher than the previous top and lower than the previous top, which is called the deviating pattern of the valley top.

(4) The author organizes the relevant understandings of the deviation into the following paragraphs for reference only:

KDJ bottom deviation, about 60% needs to be operated, and the valley deviation is the bottom signal. Appears in the early stage of sharp decline after sharp rise, decline relay, and long-term decline at the end of the session; first fall and then rise, the deviation point is the starting and falling point needs to hit a new low, beware of bulls traps; first look at the height of KDJ position, and then see if the cross fails, two crosses; low, dead fork three days, turning head gold fork to confirm, failure or two forks are more reliable; buy point is the positive line that closes higher than the opening of the front female line and the entity exceeds 1%; multiple occurrences or deviations from the reverse top appear one after another, and the later one is the new standard.

KDJ reverse bottom deviation, the error rate is 15% to 20%, which appears in the sharp rise of the market correction, horizontal consolidation, and a resistant decline relay; double market testing function, first falling and then rising and then falling, the deviation point is the falling point needs to hit a new low; the buying point is the positive line that closes higher than the opening of the front root and the entity exceeds 1%; the rise is the last rise, the height does not exceed the starting and falling point before the deviation, and there is a short trap; the market breaks through the highest point before the deviation, and the new low function is lost; it appears many times or the top deviation appears one after another, and the next one is the new standard.

KDJ top deviation, about 85% need to be operated, pay attention to the superposition situation. Appears in the early stage of rising after a long-term decline, rising relay, and rising end; top measurement function, the deviation point is the starting and falling point, and if it continues to rise, it will be sold after closing the yin line; the short position point is the negative line that closes lower than the opening of the previous positive line and the entity exceeds 1%; it appears many times or deviates from the reverse bottom one after another, and the later one is the new standard; the deviation point has a large volume, and the price should be careful to increase and contract. The peak deviation is the top signal.

KDJ reverse top deviation, the error rate is 15% to 20%; appears in the early stage of lateral consolidation, rising after a long-term decline, and rising relay; double market testing function, falling first and then rising, the deviation point is the starting point to hit a new low; the buying point is the positive line that closes higher than the opening of the previous negative line and the entity exceeds 1%; the decline is the last fall, and the low level of the rise before breaking is a short trap; multiple occurrences or deviations from the bottom appear successively, and the later one is the new standard; the amount of deviation point is slightly larger, and the amount of land before the start is a low-price area, which can be referred to.

(5) The author divides the deviation into two main parts:

1. The top deviation, reverse top deviation, and peak-separated top deviation are placed in the upper part, and the bottom deviation, reverse bottom deviation, and valley-separated bottom deviation are placed in the lower part for distinction;

2. Divide the golden fork and above the golden fork, and the dead fork and below the dead fork into two areas with different colors. Whether it can be operated or not can be seen at a glance.

(6) Deviation from the trap

1. KDJ top away from the trap

The KDJ indicator shows a top deviation, which generally means that the price has insufficient motivation to rise and is about to peak and fall back. Sometimes, it only completes a small pullback of KDJ by sideways consolidation or a slight decline, and then rises again, forming a technical short trap. This is the KDJ top deviation trap.

In this case, the top deviation does not trigger short-term selling pressure in the market, of course, it will not reverse the original upward trend of the price, but only delay the speed of the market rise. When the technical adjustment is in place, a new round of upward market will naturally follow.

The basis for judging the top departure trap: When the KDJ indicator slides down and rises again, breaking through the pressure line formed by the connection of the two high points when the KDJ diverges, the top departure trap can be determined. Don't miss it at this time, intervene boldly, and focus on short.

If the KDJ falls below 50 during the fall, the possibility of a top-divergence trap is greatly reduced, and special attention should be paid.

2. Bottom deviation trap

The price did not bottom out or reverse after the KDJ diverged, but instead fell again and again, constantly hitting new lows, forming a technical bull trap, which is the bottom divergence trap.

It should be reminded that the bottom deviation trap is not that the price does not rebound, but that the height of the rebound is limited in the subsequent period, and then it falls back into the long adjustment process. According to statistics, the bottom deviation trap has fallen by about 10% to 30%, with an average of about 15%. Therefore, special attention should be paid in practical operation to carefully distinguish between the bottom deviation and the top deviation trap, and combineShield BoWait for the trading tools to make a comprehensive judgment.