Rebirth of the Capital Legend

"Since many institutions in the industry are still continuously taking over the selling orders in the market, and the core theme of 'big infrastructure' is currently strengthening, both in terms of fundamental logic and policy-related favorable expectations, I think that even if the overall market investment sentiment is getting worse and worse, and the liquidity in the market is becoming increasingly scarce, the 'big infrastructure' line should also receive strong support." Huang Qingyun thought for a while and said, "However, once this trend breaks today, the panic selling force in the market will definitely increase and continue. The overall investment sentiment is unlikely to improve in the short term. This means that although the 'big infrastructure' line is unlikely to fall too far, it is difficult for it to strengthen independently of the overall market investment sentiment.

So...I think that in terms of our next trading strategy, generally speaking, we must not give up the core theme of "big infrastructure".

But right now, we can’t increase our positions too aggressively.

Maintain the current position level, continuously reduce the holding cost through continuous intraday trading, keep enough positions and funds, and then wait for this wave of panic selling to pass, the chip structure in the market to stabilize again, or in other words, there will be stronger policy benefits and explosive performance realization on the "big infrastructure" line, with sufficient upward momentum, and the K-line technical pattern also has the trend of upward breakthrough.

The safest approach is for us to continue to increase our positions and put in the subsequent available funds.”

"Well, you're right." Men Xingtao nodded slightly and said, "Although institutions in the industry are still increasing their holdings of the core theme of 'big infrastructure', the selling pressure in the market is very heavy at this stage. The power of institutions alone cannot support the entire market sentiment and reverse the trend.

After all, in the current bear market, the fund industry is in a downturn.

In fact, many fund products do not have sufficient funds.

Even many fund products in the industry have to face continuous redemptions of shares by fund investors due to the continued decline in net value, and are forced to sell stocks.

In short, the current market's potential long power is far smaller than the potential selling power.

In other words, the selling pressure in the market has not yet been released.

Only when this heavy selling force is released, the internal chip structure will stabilize again, the chips will settle again, and the market will shrink significantly.

Only then will you have the ability to initiate a new breakthrough.

Before that, we must respect market trends and focus on defensive trading strategies.”

"I think so too." Huang Qingyun nodded and said with a smile, "Boss Men, today the defensive mainline sectors such as liquor, white appliances, medicine, consumption, and finance have performed well, and institutions have formed a serious group in these defensive mainlines. And due to the performance of these defensive sectors in the past six months, many investor groups and capital groups in the market, including hot money and retail investors, seem to have formed a trading mindset of 'whenever the market falls, they will group together to hedge against the core leading stocks of liquor, white appliances, medicine, consumption, and finance'.

Under this inertial thinking, institutions also work together to lock up their positions.

I feel that if the market continues to adjust downward and there is panic selling in the market, the selling will continue.

Defensive sectors such as liquor, white goods, medicine, consumption, and finance have the opportunity to go against the trend and strengthen independently of the overall market trend.

We...can we move part of our positions to these defensive sectors?

To hedge against the risk of a market decline.”

Men Xingtao thought for a moment and said, “Once most of the market funds have this kind of inertial trading thinking, once an investment opportunity is discovered by everyone, then this kind of trading thinking and logic will inevitably become invalid. Moreover… At present, the liquor, white goods, medicine, consumption, and financial sectors have already fulfilled most of the expectations and next year’s performance expectations after the rise in the past six months.

If we intervene at this time, first of all, the timing is not right, and secondly... the cost issue makes it difficult to guarantee that we will gain anything.

If we want to hedge the risk of a market index decline and our positions in the main area of ​​"big infrastructure"... it would be better to use a small portion of funds to open a short position in the CSI 300 Index or the CSI 500 Index futures to hedge. "

"That makes sense." Huang Qingyun's eyes lit up when he saw Men Xingtao mention the trading strategy of using stock index futures for hedging. He said, "I think it's feasible to use stock index futures for hedging. Today's market index has fallen below the platform support and lost the important moving average. From a technical point of view, it is indeed difficult to stop the decline in the short term. We should be able to avoid this wave of adjustments by using a small part of the funds for stock index futures hedging."

Meng Xingtao thought about it and said, "That's fine."

The essential purpose of the stock index futures trading product is to hedge risks.

As far as he knows, there are not just one or two institutions in the industry that use stock index futures for risk hedging transactions. Many institutions are using this hedging tool.

After all, stock index futures naturally have leverage properties.

Whether it is opening a long position for hedging or a short position for hedging, it does not require too much funds to complete.

"I always feel that... when we use stock index futures for hedging transactions, is it more appropriate to use the CSI 300 Index futures or the CSI 500 Index futures?" Huang Qingyun said, "I feel that... in the current market, it is obvious that the trend of small and medium-cap concept stocks is much weaker, and the trend breakdown is more serious.

If the market is expected to continue to adjust...

Then, small and medium-cap concept stocks that do not have large-scale increases in holdings and help lock up positions by major institutions will definitely become the hardest hit areas of the sell-off.

The index that is most closely related to the market's small- and medium-cap concept stocks is the 'Huazheng 500 Index'.

Therefore, I think that using the 'China Securities 500 Index Futures' for hedging transactions may be more beneficial to us, and the 'China Securities 500 Index' has a significantly greater risk of falling at this point and in the current market situation. "

"Then let's go with 'China Securities 500 Index Futures'," replied Monxingtao.

"Okay." Huang Qingyun smiled when he saw Men Xingtao made the decision without hesitation. He responded and without waiting for his further instructions, he began to gather all the traders in the trading room to formulate tomorrow's trading strategy.

While the two were discussing the disclosed data of the Dragon and Tiger List of the two cities and adjusting their trading strategies in a timely manner according to the market trends...

At this time, countless retail investor groups gathered on the stock investment exchange platform across the entire network.

But they were all dejected and complained endlessly.

"Today's trend is really amazing. It didn't rise much before, but it fell back in one day."

"That's right. A week's rise is not enough to make a day's fall."

"Oh, my full position is down today. It's so horrible. I don't even want to open my account anymore."

"I've already laid flat. Let the price drop as much as it wants. Anyway, if I don't sell, I won't get hurt. I believe that as long as the stock is not delisted, it will rise again sooner or later."

"What if it really delists? Now the market funds seem to be becoming more and more biased against small and medium-cap stocks."

"No way? Look at how many stocks have actually been delisted in recent years? As long as you are not too unlucky, they will basically not be delisted."

"Even if the company doesn't delist, it would be very frustrating if the share price dropped to only one-third or even one-fifth of its original price."

"Just don't look at it, don't pay attention to it, forget the account, forget the password, and open it again after a few years."

"I can't do that. I want to sell my stocks when I lose a little."

"The key is that this is no longer a matter of cutting losses. Even if I sell the stocks I have and buy other stocks, it won't change the loss situation!"

“Indeed, there are only a few stocks in the entire market that can go against the trend and continue to rise.”

"Since the end of the 'big infrastructure' rally, the market has basically returned to its previous pattern of continuous decline. A few days ago... major institutional groups said they were optimistic about the market trend in the second half of the year, but... haha, ever since the institutions started to sing bullish tunes, the market has never stopped falling."

"I didn't catch up when the 'big infrastructure' was squeezed and rising, and now I'm just getting beaten up."

"The key is that when the main line of 'big infrastructure' was rising crazily, the stocks I held didn't rise at all. Now that the 'big infrastructure' line has started to adjust, the stocks I held have fallen even more sharply. It's really a mental mess. It's poisonous. It's already fallen to the point of ankle cutting, and it can still fall so much. I'm really impressed."

"Looking at the entire market, it seems that only the liquor, white goods, pharmaceuticals, consumer goods, and financial sectors are doing slightly better."

"It's better for sectors like liquor, white goods, medicine, consumption, and finance not to rise. The more they rise, the more other stocks in the market will fall. The more the 'national team' supports the market, the worse the market trend will be."

"The liquor, white goods, pharmaceutical, consumer, and financial sectors have absorbed all the liquidity in the market. There is no decent buying for other stocks. How can they not fall?"

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"I will never be a supporter for the 'national team'."

"If you chase the main sectors such as liquor, white goods, medicine, consumption, and finance, which have already risen to the highs of the last bull market, you may be stuck at the peak again."

"It feels like the 'national team' keeps pushing up the stocks of these main sectors to attract everyone to take over."

"If we don't attract everyone to buy, how can the 'national team' reduce their holdings and exit? During the stock market crash last year, the 'national team' bought trillions of shares, and these funds also need to be sold."

"The market liquidity is already poor, and these heavyweights are sucking up liquidity, so it's impossible to play at all."

"Looking at the market's turnover, it feels like if the market continues to fall, the market's turnover will fall back to around 3000 billion."

"For many stocks, the daily trading volume is only around 2000 million."

“No wonder there is no hot money buying at the bottom. With this amount of trading, even if they buy at the bottom, they won’t be able to get out!”

"Don't fantasize that the market will rise, and don't have any expectations for the future market. The bear market will continue for at least several years before it really bottoms out."

"Based on the adjustment after the last bull market, the market has clearly not bottomed out yet."

"Alas, I will not play tomorrow. Not only are the large-cap blue-chip stocks siphoning liquidity, but the hot off-market property market is also siphoning liquidity from the stock market!"

"Yes, many of my friends who used to speculate in stocks are now speculating in real estate."

"Houses are still safer, and the policies are supportive."

"The property market is going crazy right now, but I don't understand why the real estate stocks in the market just can't go up and form a breakthrough trend?"

"Real estate-related stocks, and even the entire 'big infrastructure' theme, have already seen a surge? Haven't many leading stocks in core industries already risen by 30% to 50% from the bottom? This is not considered a surge, is it? I think it has almost reflected expectations, right?"

"This doesn't reflect the expectation of a hot property market, does it? After all, these sectors fell terribly before."

"Whether or not it reflects the expectation of a hot offline real estate market, it seems that the entire 'big infrastructure' theme is completely weak, and many stocks have broken through."

"What's strange is that in the entire 'big infrastructure' main line area, institutions are still continuing to increase their holdings."

"What's so strange about this? No one has stipulated that institutions cannot lose money."

"That's true. It's just that those who are selling at a loss are all retail investors. We always feel that something is wrong. I feel that the 'big infrastructure' line... maybe the market has not yet finished."

“Even if the long-term trend has not yet completed, it will still have to go through short-term adjustments and readjust the internal chip structure.”

"Let's see how the market will work together. In the current market, it is impossible for institutional funds to force a trend."

"If Huayi Capital, headed by President Su, can continue to sweep the Dragon and Tiger List and continue to give everyone confidence to go long, it feels like it can still lead the market. I remember that the last wave of the main line of 'big infrastructure' was led by President Su."

"Hua Yi Capital, which is headed by President Su, doesn't have that much money to keep buying."

"You're overthinking it. Even with trillions of dollars in funds, the 'national team' cannot forcefully guide the market, rally the overall bullish sentiment in the market, and change the market trend. The maximum amount of funds in Mr. Su's hands does not exceed 1000 billion. It is basically impossible to guide the market against the trend. The change in market trends ultimately depends on the combined efforts of the market's own funds."

"Yes, there are at least tens of trillions of locked-in positions waiting to be resolved. Anyway, I am not optimistic."

“It should have broken out today, but it ended up falling unilaterally… This is hard to be optimistic about!”

"Indeed, it will obviously continue to fall..."

As countless retail investors across the Internet discuss the subsequent market trends, as well as the buying and selling motives of the major funds disclosed by the two cities' Dragon and Tiger Lists.

Pessimism in the market continues to spread.

Moreover, since there was no obvious positive stimulus after the market closed, a part of the investor group had expected the regulators to introduce favorable policies to maintain the market.

After expectations were dashed, I was worried about tomorrow's market trend and subsequent market trends.

They also began to become pessimistic and started to take bearish views.