The reasons behind price fluctuations involve a complete set of market logic and behavioral driving mechanisms. In one sentence, it can be summarized as: supply and demand determine prices, while emotions drive fluctuations.
🧐 Price rises and falls can be observed from two aspects:
In summary: Price fluctuations are caused by the combined actions of retail investors and main players. However, in the actual market, retail investors often do not place buy orders at higher prices; they will only buy at prices lower than the current price. Therefore, under normal circumstances, stock prices tend to continuously decline.
So we often say that when prices rise, it is usually the main players who are driving the increase. Only they will continuously buy stocks at higher prices, but their money is not unlimited. Therefore, before pushing prices up, they will usually test the waters by slightly placing higher buy orders to see if retail investors will sell here. If many retail investors sell at this point, it indicates that there is significant selling pressure. The main players often choose not to spend large sums to buy everything forcefully; instead, they opt to push the price down, allowing those who want to sell to do so at lower prices. This way, the main players can break through the original buying pressure zone at a lower cost.
PS: Some main players may choose to forcefully buy in large amounts, breaking through resistance levels all at once and buying up all the chips sold. These main players are often very confident in the future rise of the stock, which can also trigger retail investors' emotions to buy in, leading to a significant price increase.