Through The Theoretical Research Of The Chinese Stock Market Bubble Signals Effect

The explanation of price target is an important topic in Financial behavior theory. That is why excess returns can be obtained by the recognized price target (breakthrough monthly Equal-string, etc.) under imperfect market. The conventional explanation focuses on the psychological factors; the paper sees the problem with a new angle by using expected inconsistency theory and the theory of noise investors. The paper sees the process as the expansion and collapse of irrational bubbles. Firstly the paper proves that the basic conditions of the process exist. After that the paper shows the Excess returns using technical price target. At last the paper gives a model using empirical data obtained.