The stock market is a market full of variables and risks. Investors often encounter this question: Why can't stocks be bought down? In the market, there are many stock prices that continue to fall. Why can't we buy while they are low? The answer to this question is not simple and requires analysis from multiple perspectives.
1. Fundamental analysis: The price of stocks is driven by the financial status, financial statements, performance and other fundamental nature of listed companies. Stock prices generally correlate with a company's performance. If the company performs well, the stock price will rise; otherwise, it will fall. Suppose that for some reason a company does not perform as expected over the next few months or years, and at that time the stock price will fall. Buying stocks at this time is like investing money without knowing it, and the risk is greater.
2. Technical analysis: Technical analysis is a method of confirming price trends and trading opportunities through the analysis of stock charts. Technical analysis focuses on the price of the stock and is subject to forces such as market supply and demand, historical prices, and trading pressures, rather than the fundamental information of listed companies. Therefore, when prices fall, technical analysts will think that they may continue to fall, so It is recommended not to buy.
3. Market risk: Another factor in the decline of stock prices is market risk. Market risk refers to the overall risks faced by the stock market, such as market instability, political factors, and natural disasters. These factors will affect stock prices. If there is a market risk, the decline will continue for a period of time, and buying during this period is buying risky assets.
4. Emotional factors: In the stock market, emotional factors are also one of the factors that lead to the decline of stock prices. Due to the dynamic psychology of market participants and their behavior of chasing the rise and killing the fall, the volatility of stock prices has also increased. Therefore, if one buys when the stock price falls irrationally, investors will often feel frightened and depressed when the market trend is downward, which may lead to greater losses.
To sum up, there are many reasons why stocks should not be bought down. The trend of stock prices is determined by the relationship between market supply and demand and the quality of the company's fundamentals, and this market is generally full of risks. When prices fall, there may be buying opportunities from a technical perspective, but the risks also increase accordingly. Investors must treat the stock market rationally and seize opportunities in order to succeed in the market.