Core Viewpoint - The article discusses practical strategies for stock trading, focusing on the importance of understanding signals for both adding and reducing positions in the market. Group 1: Adding Positions - The first signal for adding positions is that the pullback should not exceed one-third of the previous rally's gain, indicating that the stock still has potential for rebound [3]. - The second signal is that trading volume should decrease to below 60% of previous highs, suggesting that selling pressure has been largely absorbed [3]. - The third signal is that at least 30% of stocks in the sector should be showing strength, indicating overall sector momentum which increases the likelihood of individual stock gains [3]. Group 2: Reducing Positions - Reducing positions requires a counterintuitive approach, as many retail investors tend to be greedy, often waiting for higher returns and risking losses [5]. - A dynamic stop-loss strategy is suggested, where a third of the position is sold if the stock deviates more than 15% from the 20-day moving average, and half is sold if it deviates by 25% [5]. - A significant increase in daily turnover, exceeding twice the average of the past 30 days, is a warning sign to exit positions, as it may indicate that major players are offloading shares [5]. Group 3: Information Disparity - The article highlights that even with positive news, stock prices may stagnate due to information asymmetry, where institutional investors may have access to negative information before retail investors [8]. - It emphasizes the importance of utilizing tools to mitigate the risks associated with information gaps, which can be a significant cost for retail investors [8].