The BIAS indicator, also known as the multiplier-off rate indicator, is the difference between the closing price of the day and the corresponding cyclical moving average. The index is composed of three curves, that is, the shorter the offset line of different cycles, the faster the fluctuation speed. So how to use BIAS indicators to determine the timing of buying and selling?
The basic principle of the multiplier rate is: if the stock price is too far from the moving average, it will not last too long, and it will soon be close to the average again.
1. Generally speaking, in a weak market, a 5-day multiplier and departure rate of more than 6 is an overbought phenomenon and a selling opportunity. When it falls below -6, it is oversold and is a buying opportunity.
2. In a strong market, when the 5-day multiplying-off rate is greater than 8, this is an overbought phenomenon, when it reaches -3, it is an oversold phenomenon, which is a buying opportunity.
3. When the overall trend rises, there will be many times of high prices, which can be sold at the previous high prices. When the overall trend is down, there will be several low prices, and you can buy at the negative multiplier point of the previous low price.
4. It is not easy to judge the positive or negative deviation of the price market. Comprehensive analysis and judgment should be combined with other technical indicators.
5. In the case of a negative multiplier rate, when the general trend rises, you can use the downside to buy.
6. When the general trend declines, if there is a positive deviation rate, it can be sold at a higher price.
Buy signal
1. When the moving average gradually changes from decline to consolidation or rise, and the price breaks through the moving average from below the moving average.
2. When the price is lower than the average level but immediately rises to the average level, the average level is still rising.
3. When the price trend line is at the moving average, the price will not fall below the moving average, but will reverse and rise immediately.
4. When the price suddenly plunges, breaks below the average level and is far from the average level, it is likely to rebound and rise.
Sell signal
1. When the moving average gradually changes from rising to closing or falling, and the price falls below the moving average.
2. When the price breaks through the moving average, but immediately falls below the moving average, the moving average continues to fall.
3. When the price trend line is lower than the average line, the price increase will not break the average line, and immediately reverse and fall.
4. When prices suddenly rise, break through the moving average and move away from the moving average, they are likely to rebound and fall back.
BIAS practical skills
Although the calculation of the BIAS index is relatively simple, in actual operation, before obtaining a complete deviation rate curve to analyze the trend of each price, other factors need to be considered to facilitate investor choice. Specifically, there are the following points:
1. The value of N-day bias is roughly divided into 6, 10, 30, 72 and other values to judge the short-term, mid-term and long-term market trends of the price market.
2. Generally speaking, when the BIAS index is low, you can buy the price; however, when the BIBS index is high, it indicates that the current stock price is high and you can sell.
3. Use the N-value fast line and the N-value slow line for comparative observation. If the two lines are in the same direction, the upward trend will be stronger. If both lines fall, the decline will be even greater. If the fast line crosses the slow line, this is a buy signal; if the fast line is below the slow line, it is a sell signal.
In fact, the level of the BIAS index can well reflect the current market conditions and indicate whether the index can be bought or sold. However, in the process of specific trading operations, it should be determined according to the actual situation of the individual, because the BIAS index obtained will vary due to It varies from species to species.