Marketmakers speculate in stocks for profit, and they also use the difference between buying and selling to make profits. Unlike retail investors, they can control the movement and price of stocks. It is especially important to learn to distinguish between whipsawing and shipping.
Difference Between Whipsawing and Shipping
- When the market is whipsawing, the stock price falls rapidly under the pressure of the market maker, but it can obtain strong support below it; and when it is shipped, the stock price quickly rises under the pull of the market maker, but there is an obvious stagnation above.
- When whipsawing, the trading volume cannot be enlarged when it is falling, but it is very large when it is rising; when it is shipped, the rising trading volume cannot be enlarged, but the trading volume can be enlarged when it is falling.
- The stock price of the former will continue to run upward; the stock price of the latter will not continue to run upward after it falls below the 10 moving average.
- When the market is whipsawing, the stock price will break upward after finishing; when shipping, the stock price will break downward after finishing.
- When whipsawing, there is almost no good news, and occasionally there is bad news; when shipping, there is almost no bad news, all the good news is continuous, giving people a lot of room for imagination.
- During the whipsawing, the trading volume shows a decreasing trend; when shipping, the trading volume has been maintained at a high level.
- In the former case, investors are in a state of indecision, fearing that the stock will be stuck when buying, and they have insufficient confidence in holding shares; in the latter case, investors are in a state of extreme excitement, worried that they will go short after selling and hold shares of confidence.
Discrimination of Whipsawing and Shipping
- The purpose of whipsawing is to scare off the follower, often fake dramas are real, and the uglier the graphics, the better. When the effect is achieved, the chips are also picked up, and then the stock price will soon rise to a higher level; and the purpose of shipping is to sell, and it is often concealed. There are a few positive lines from time to time on the way down. Stock price kept falling, with highs lower than the last.
- The main force often pays attention to the adjustment position when whipsawing. Some important support levels and technical positions will never be broken; while the shipping does not pay attention to how the moving average moves, as long as it can be shipped anywhere.
- The location where the stock price is whipsawing generally occurs when the stock price does not increase much, generally not far from the bottom, at the middle and low level of the stock price, and the time is not very long; and the shipment generally occurs when the stock price increases greatly, doubling or even several times the high level. , generally for a long time, sometimes even up to several months.
- Generally, the trading volume cannot be effectively enlarged, and with the passage of time, this volume can gradually shrink to the extreme; while the shipment is generally accompanied by a sharp expansion of the trading volume, sometimes it is heavy for several days, and once there is a fall of the trend, the stock price is like a kite with a broken line, swaying down with the wind.