Rebirth of the Capital Legend

"So, we should avoid some stocks that were hyped up in the last bull market." Liao Guoxiang continued, "The market always likes the new and dislikes the old. The old leaders of the past, because they had their past glory, the large number of retail investors gathered here always fantasize about when these stocks will create glory again, resulting in the chips inside these stocks can never be cleaned up. If there are too many retail investors, the stock price will be pulled up, the market will not have enough synergy, and the trend will not be consistent, so it is naturally not easy to get out.

Compare these stocks such as Quantong Education, LeTV, Baofeng Technology, and Maruda Film and Television...

Obviously, the trend of the check of 'Chinese Online' is much smoother, and the internal chips are also cleaner. This is the proof that the market likes new things and dislikes old things.

Of course, it is not limited to individual stocks, but also applies to concept sectors and conceptual themes.

There are no new concepts or new stories.

Those stories from the past are unlikely to resonate with the funds in the market.

Just like the explosive strength and rebound height of this round, which far exceeded the expected main line of "big infrastructure".

Do you think the fundamental problems of traditional industries such as real estate, building decoration, building materials, nonferrous metals, steel, and coal have changed?

I think it hasn't changed.

But with the help of the 'new infrastructure' and the macroeconomic policy of 'supply-side structural reform', new concepts and stories, and the hot offline real estate market, it suddenly came out. "

"As for concepts and stories, the 'technology' sector naturally has a huge advantage." Li Jinshi pondered for a moment and responded with a smile, "The improvement of technical routes is always changing, and innovation on the application side also has new things and new concepts coming out every day and every month."

"A simple story and concept can attract some short-term funds to speculate, but without the expectation of explosive performance, it is difficult to attract the main institutional funds in the market to lock in positions." Chen Guiyun thought for a while and said, "Without the expectation of explosive performance, even if individual stocks are temporarily speculated by short-term funds in the market, it is likely that they will only fluctuate in a pulsed manner, right?"

"If the height of this pulse is high enough, then the value of the game is still very high." Li Jinshi said, "The short-term trading logic and the long-term trading logic, the trend of stocks with consecutive gains and the trend of stocks with consecutive gains are actually not contradictory. The market is so big that it can accommodate institutions like Oriental Yuhong to hype stocks together, and it can also accommodate hot money like Huawen Online to continuously take over short-term leading stocks with consecutive gains."

"Old Li is right," Liao Guoxiang said. "There is no contradiction between the two trading modes. If you want sustainability and stability, choose stocks that are backed by institutions. If you want short-term flexibility, choose stocks that are backed by strong hot money. The difference between the two lies in stability and short-term flexibility."

"But it feels like today, the sectors of 'Film and Television Media', 'Internet Software', and 'Internet Applications', except for the 'Huawen Online', are still maintaining a very strong trend. The performance of other related core leading stocks and even the industry sector index is somewhat below expectations." Chen Guiyun said, "Based on the performance of these sectors in the early trading today, they should have accelerated upward with shrinking volume, and the market should have tended to be consistent, but now in these sectors, there is still a serious divergence between long and short positions.

What is visible to the naked eye is the short-term speculation fund group and the concentration point of emotions in the market.

It has shifted from these three major sectors to the branch line that is more inclined towards "consumer electronics".

Of course, at this moment, the "big infrastructure" line has begun to strengthen again and has begun to siphon active capital flows from other main lines of the market.

I feel that the market rotation speed is accelerating, and the potential risks of transactions are actually increasing.

The overall market performance is far less strong than its emotional performance.

In other words, the current market trend seems to be somewhat divergent from the sentiment side.

When there is a divergence between sentiment and trend expectations, I believe that the market has actually entered the risk stage. At this stage, the cost-effectiveness of short-term speculation may not be very good.

Moreover, when the rotation of market hotspots accelerates, it is actually a sign of weakness.

Now in the entire market, only the low-level sector of 'new energy industry chain' has not yet seen a rotation rebound. I think that when the only line of 'new energy industry chain' in the market starts to move, that means all the hot spots in the market will have completed their rotation.

There is a high probability that the market will soon undergo an adjustment.

With the index at this position, I think there is a high probability that it will fall back to 3000 points again to confirm the breakthrough.

Therefore, we analyze it from the perspective of sentiment and the divergence between trends.

After the opening of the market this afternoon, the major sectors of "film and television media", "internet software" and "internet applications" did not continue to produce the results that everyone wanted. Seeing that short-term hot stocks began to show huge long-short divergences, various funds refocused their attention on the main line of "large infrastructure" which tends to be more stable, which is understandable. "

"The logic you said is correct, Lao Chen." Li Jinshi thought for a moment and took over the conversation, "But judging from the market trend and the K-line pattern of the index, if it starts to retrace and adjust here, then there will probably not be a stronger subsequent wave of main upward rebound. In fact, the index has no room for rebound here, especially the ChiNext Index, the China Securities 500 Index, and the All-China Securities 1000 Index. They have only rebounded 10% from the bottom. How can they retrace with such little space? They haven't even completed a complete breakthrough trend."

"The K-line pattern of the ChiNext Index has indeed not yet formed a complete breakthrough trend." Liao Guoxiang took over and said, "Looking at the K-line pattern alone, the ChiNext Index is likely to continue to rise. I think the market hot spots are rotating too quickly, and short-term funds are frequently attacking and switching hot spots frequently. Although the fundamental reason is still the excessive selling pressure in the market, the most important factor that restricts the elasticity is the market volume."

"Yes, yes, Lao Liao is still clear about it." Li Jinshi laughed, "The current market volume, in fact, compared with the bottom position, although the volume has increased a lot, the overall volume is still lower than the expectations of the majority of investors in the market. With this volume, it is simply unable to support a sustained general rise in the market. Therefore, the market has been moving in hot spots recently. I think... as long as the underlying logic is not broken, and the K-line patterns of the major indexes, the core main lines, and the popular leading stocks are still in an obvious upward trend, then there is no need to panic.

This position actually hasn't increased much.

Moreover, the index has been supported above 3000 points for so many days, which can be regarded as a substantial breakthrough trend.

The entry of incremental funds from the OTC market requires both time and the stimulation of continuous money-making effects within the market.

If we blindly force a general rise, it will only quickly overdraw the bullish power in the market, leading to even greater potential selling pressure from above.

Keep rotating like this, grinding upwards little by little.

I think it’s great because it not only maintains the money-making effect within the market, but also avoids facing a sudden surge in selling pressure.

Furthermore, even if there are fluctuations at this position, as you said, Lao Chen, if the Shanghai Composite Index will fall back to 3000 points, the current position is only 3000% away from the support point of 1.5 points. With this adjustment range, the pullback is actually completely bearable.

There is no need for us to change our trading strategy at this point and switch to a defensive trading strategy just for the risk of an index pullback of one or two points, right?

In fact, look at the stock of 'Oriental Yuhong' and the stock of 'Huawen Online'.

The potential buying power of the two checks is still very strong.

Just in the last wave of plunge, the daily limit order on 'Huawen Online' remained motionless, while the performance of 'Oriental Yuhong' was even stronger. As long as its stock price dropped a little, the subsequent buying power began to emerge in an endless stream, and it looked like the stock could not fall at all.

As long as these two stocks remain stable, there is no need to worry about how much room there is to expand.

As long as the market can be stabilized, the short-term bullish sentiment in the market will continue to ferment.

Even though the market has a clear tendency to get bored with the old and love the new, as long as sentiment remains stable, some clear opportunities can still be seized between changes in hot spots.

Overall, at this position, I think it is better to maintain a more aggressive trading strategy.

As for chasing hot spots, there is no need for that.

Since the market's general trend is characterized by market rotation, then we should follow this line, or hold on to one line and wait for rotation, or lurk in the main line sectors that are at a low level and have not yet rotated.

In fact, the 'new energy industry chain', a low-level main sector that has not yet rotated and has not risen sharply, is really good.

At least, I think this line is stronger than the underlying logic of the 'film and television media', 'Internet software', and 'Internet applications' sectors.

After all, the general trend of "new energy vehicles" in the future is still very obvious.

The country's cleanup of subsidy fraud is also aimed at optimizing the industry and making the development of the entire industry healthier. From a general policy perspective, the country's investment policy in this direction will not change.

Moreover, it is foreseeable that the support in the future will be even greater than it is now.

After all, in the automobile industry, when the concept of "new energy vehicles" comes, it is our only best chance to overtake the foreign automobile industry.

I think this opportunity will never be missed at the national level.

As long as the general direction and policy are correct.

Well, for the industry's core leading stocks that are unable to demonstrate their performance now, or whose performance is significantly lower than the psychological expectations of a large number of investors both inside and outside the market, there is a high probability that they will experience an explosion in performance and growth in business scale in the future, but there are some twists and turns now.

Of course, if these small twists and turns in the big logic affect it.

The line of 'new energy industry chain' will not fall to this position.

The reason why this line has fallen to its current position is that there has been no decent rebound and no strong main institutional capital group's attention.

The main reason is that the chip structure of this line is still in a state of continuous divergence.

That is, a large number of retail investors are gathering, while the main institutional capital groups that intervened in the early stage have withdrawn in large numbers. At present, there are no other optimistic main institutional capital groups that continue to build positions on a large scale.

A large number of institutional funds quickly built positions on this line.

The root cause of this is still the original institution "Huayi Capital", the work of Mr. Su.

If it weren't for Mr. Su of the institution "Huayi Capital" who concentrated his heavy investments on this line, I estimate that the "new energy industry chain" line would not have overdrawn so many expectations and increased so much, and there would not have been a continuous downward adjustment against the trend in the past one or two months.

The funds from 'Hua Yi Capital'.

At present, the market trend has been somewhat bullish and bearish.

As long as this institution buys in heavily, the subsequent performance will generally be sharp. As long as this institution sells out on a large scale, the subsequent performance will generally not be very good.

However, it is due to the large-scale reduction of holdings of the "new energy industry chain" by the institution "Huayi Capital".

This has led to the 'new energy industry chain' line currently lagging behind the market, with the decline somewhat exceeding expectations.

Even if we don’t consider the future logical direction, just from the K-line pattern and the volume situation, it feels that the ‘new energy industry chain’ line should also usher in a rebound cycle.”

"If there is no better target, lurking in the 'new energy industry chain' line and waiting for the subsequent market hot spots to rotate is barely feasible." Liao Guoxiang nodded, "The entire 'new energy industry chain' is currently in a state of extreme shrinkage, and this volume performance, under the current market sentiment, although relatively weak, can also be seen as a feature of the short-selling force being exhausted and unable to smash. To be honest... I am still optimistic about the future development prospects of the core line of the 'new energy industry chain'. If it can continue to fall through, there may be a good opportunity to open a position."

"Isn't it the worst yet?" Li Jinshi asked.

Liao Guoxiang responded: "Not really. I guess there should be quite a lot of institutional main funds lurking in it, because on the market, several hot stocks in the main line of the 'new energy industry chain' that moved abnormally today did not move smoothly, and all showed a relatively obvious pulse trend.

Following the heated discussion among several people in the internal group of 'Fushan System'.

The market's trading hours soon reached 2: p.m.

After a brief dive, the major market indexes began to collectively fight back. At the same time, the 'new energy industry chain' mentioned by several hot money bosses of the 'Fushan Group', which was the main line of the market's rebound that had not been rotated before, also showed some unusual movements in the index's counterattack again, showing a trend-following market and a situation where many short-term capital groups concentrated on buying and speculation. The corresponding hot stocks began to rebound upward.