Technical analysis in the stock market is revered by many investors as the "Holy Grail."

They believe that as long as they master the techniques, they can gallop on the battlefield of the stock market and win every battle.

Indeed, the technical analysts in the stock market definitely have a much stronger ability to make money than those who do not understand the technology.

But since the popularization of quantification, many technical models have already started to upgrade, while retail investors are still at the primary stage of technology.

The pitfalls of technical analysis are becoming more and more obvious, and the probability of losing money with a half-baked understanding of technology has greatly increased.

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Retail investors must understand one thing, all techniques have been quantified and tested for returns with models.

Under such circumstances, many techniques have begun to refine and differentiate, and some techniques have already become ineffective.

Being obsessed with learning technology, ignoring the heat of the market, ignoring the capital of the market, is very dangerous.

This is also why many retail investors enter the market to learn technology, and the result is a huge loss in a short period of time.

Because the rhythm is wrong, the error rate of technology increases, and the technology becomes ineffective.Constantly remind yourself: Technical analysis is a double-edged sword.

Once misapplied, the consequences are unimaginable.

If technical analysis really could bring such good returns, then those who use technical analysis to trade stocks would have all been financially free in a few years.

And the actual return rate of quantitative models shows that excellent technical models, in the end, can only achieve an excess return of 20-30% per year, which is already the limit.

This 20-30% annual return is the value of the technology, not the 20-30% gained from a few limit-up boards.

Only by first clearly understanding the underlying value of the technology can one correctly understand technical analysis and know how to do it.

I have simply listed a few classic misconceptions to share with you.

Each topic can be expanded to talk about, and when there is time, we can have a detailed discussion. In fact, technical analysis is quite interesting.

1. The bare K line without considering volume actually has no reference value.In technical analysis, there is a technique known as "naked K" (bare candlestick).

Originally, the naked K technique was effective, but nowadays it has almost become obsolete.

As more and more people are able to draw lines, the simple observation of K lines has lost much of its value.

Without the support of trading volume, the naked K has become a trap.

For example, whether there will be a fourth consecutive limit-up (three consecutive days of stock price hitting the upper limit) is not determined by looking at the K line, but by looking at the trading volume, the market sentiment, and the degree of fermentation and pursuit of the theme.

The naked K itself is just a result of charting, and what manipulates the K line behind the scenes is the capital. If you look at the line instead of the capital, you are doomed to be the majority, which is the side that is cut by the main force.

In the game, the main force capital is always on the minority side, and only a few retail investors can stand on the team and make money.

2. The shorter the cycle, the higher the failure rate of technical analysis.

The vast majority of retail investors want to use technical analysis for short-term trading.

Little do they know that technical analysis is the real poison for short-term trading.If technical analysis for short-term trading is so useful, then a 10% daily return is not a dream.

Even with a discount, a 3% daily return over more than 200 trading days in a year would be a 1000-fold increase.

The ups and downs of short-term trading are entirely based on the ideas of the main force, and the failure rate of technical analysis is actually very high. Achieving an accuracy rate of 60-70% is already very profitable.

Remember, the direction of short-term trends is the result of capital games, not the result of technical analysis.

3. Monitoring the market is useful, but the problem is that retail investors simply cannot keep up.

Monitoring the market is definitely useful because it allows one to pay attention to the movements of the main force in detail.

However, for retail investors, monitoring the market is useless because they don't know how to monitor and can't monitor.

The main force monitors the market not only with manpower but also with intelligent analysis systems for monitoring.

Retail investors monitor the market with just two eyes, a computer, and a few screens.

Some even rely on a mobile phone to monitor the market, what kind of monitoring is that? Some don't even have time to look at the market, what kind of monitoring is that?Individual investors watch the market, focusing on dozens of stocks, but in reality, they can't see what's happening inside the market at all, it's better not to watch.

It's better to rely on the relationship between volume and price to capture the long-term intentions of the main force, rather than relying on the eyes to capture the short-term trends of the main force.

4. Technical analysis, in fact, cannot distinguish between washing and selling.

I am very responsible to tell everyone that if you are not the main force itself, then the distinction between washing and selling is a metaphysics.

Because, the capital operation techniques of washing and selling are the same, both are to sell first and then buy.

Selling first is for the main force to get the initiative, not to bear the pressure of selling hard, and to reduce positions first.

As for whether the price will continue to rise after washing, whether to take back the chips, the main force will judge according to the current situation, popularity, and chip distribution.

If you can distinguish between washing and selling by relying on K-line and volume, how can the main force sell and wash.

Don't always regard luck as strength, before the result is announced, what you see is what others want you to see.

5. True breakthrough or false breakthrough, it is in the mind of the main force.Regarding true breakthroughs and false breakthroughs, there is also a significant misconception in technical analysis.

Because only the main force knows the difference between a true breakthrough and a false one, he understands whether he is testing the market or about to start.

Many times, he also determines the effectiveness of the breakthrough based on the market's response.

Why some stocks continue to rise after hitting the daily limit, while others need to consolidate for a few days after hitting the limit, is due to different selling pressures and different choices made.

These, in the volume-price system at that time, are actually difficult to distinguish between true and false.

Otherwise, if one were to buy stocks that break through specifically, the return on investment would have soared.

In fact, true breakthroughs have been noticed by the market because of their continuous climb, while those false breakthroughs that are trapped have been submerged.

The application of the survivor law in the stock market is too common.

6. In bull and bear markets, the results of technical analysis are completely opposite.

The essence of technical analysis is the "idea" of capital.In a bull market, there is an abundance of incremental capital, which greatly enhances the effectiveness of technical analysis.

But to put it bluntly, everyone is a stock god in a bull market, because there are people making money everywhere.

Technical analysis is prepared for a bear market, because there is no incremental capital in a bear market, and it is mainly focused on game-playing.

In a bull market, everyone is getting on the train, while in a bear market, it's about who runs faster.

The sharp rise in a bull market is to grab the chips, while the sharp rise in a bear market is to deceive people to take over the plate.

Technical analysis is only effective in a market that focuses more on game-playing, because technical analysis is about capturing the operation of capital.

Therefore, technical analysis is divided into bull and bear markets, rather than being universal, and this point should also be kept in mind.

I'm a bit lazy, in fact, there are still many misunderstandings, the space is not enough, and I will write again when there is a chance.

Many people ask, why not do some public technical analysis teaching.To be frank, the technical analysis tutorials you can find online are mostly deceiving and nonsensical.

No one in the industry would publish their core skills on a web traffic platform and then accept public criticism.

The stock market is always profitable for a small number of people, and excellent shares are spread within a small circle, or not spread at all.

Many things, once they enter the public eye, have a very short life cycle and eventually die out, and the same is true for technical analysis.

So, don't waste time online looking at some top speculators' and operators' tactics.

Even if some things are true, you should be aware that they are the operators, and you are the followers, which are completely different.

The secret book in your eyes is just a few lines drawn at will by others.