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How Investors Can React to Diving Stocks

A stock in a short period of time, generally more than 1% within 1 minute, will be expressed as a high-altitude diving, and a stock that continues to dive for a period of time is the so-called diving stock.

Investors can start from the following aspects when dealing with diving stocks:

First, the low position should be fully changed

From the perspective of stocks that have dived in history, it is difficult to bottom out when there is an infinite decline. Only when the trading volume is greatly enlarged and new funds enter the market to undertake, it is worth noting at this time. When the hands are fully changed, it often means that the stock price has in the bottom area.

Second, the absolute stock price must be low, preferably less than 5 yuan

Some problem stocks in recent years have almost all rebounded strongly when they fell to the price of three or four yuan.

The third is that technical indicators (mainly RSI) have divergences.

The RSI indicator showed a bottom divergence at a low level, a bottom was formed, and the stock started a strong rebound.