Rebirth of the Capital Legend

"I still chose to go up. I said that the dive at the end of the trading day would not have much impact. The overall market trend will still break upward." Seeing that the market started to increase its volume and attack again in the last 15 minutes of trading at the end of the trading day, and that all core main lines had relatively strong active buying power, Zheng Jinming, one of the main speculators of the 'Gusu system', laughed and said, "The volume has started to make up. It seems that many fund groups that have been waiting on the sidelines have finally begun to enter the market and go long. As long as there is volume and continuous buying, there is hope that this wave of market rebound will evolve into a reversal."

"Well, today should be considered a general rise, right?" Lao Qian in the group heard Zheng Jinming's sigh and responded with a smile, "All the main lines have moved differently during the trading session, and there are some profit effects. It feels like the market is about to enter a stage of accelerated main rise."

"We can only say that the trend will continue, but it is not clear whether the main rise will accelerate." Zhang Xinlei, who is relatively cautious in his views on the market trend, responded, "When the market volume can continue to stabilize at the current position, the structure of the main chips can be further locked, the selling pressure on the market will not be so heavy, and coupled with the stimulation of news, there may be a chance to accelerate the main rise. Otherwise... the volume cannot support the main rise."

"No matter whether the market will accelerate its upward trend in the future..." He Zhong took over the conversation and said, "It should at least not fall sharply, right?"

"That definitely won't happen." Zheng Jinming responded. "If it was going to fall, it would have fallen a long time ago. From the market trend, we can see that every time there is a plunge in the market, there is actually a strong potential buying force. In addition, there have been adjustments almost every day in the past few trading days. That is to say, even if there is an accumulation of profit-taking orders, they have been digested within the day. At present, there should not be much profit-taking selling pressure in the market, and the potential selling pressure will not be very large. Therefore, there is basically no risk of a sharp drop or a big drop. Of course, the sharp drop caused by sudden negative news is naturally unpredictable."

"Yeah, I feel the same way." Lao Qian nodded and said, "This kind of intraday time-sharing trend has been adjusted. The market has been in a state of consensus and disagreement. The trend of constant switching is actually quite healthy. I think it is better to always maintain a local money-making effect than to maintain a short-term overall money-making effect. It is also more motivating for the capital group that is still on the sidelines."

"Yes, the sustainability of the market is actually the most important thing." He Zhong said, "Fortunately, this wave of market, whether it is the market in the main line of 'big infrastructure' or the main line of 'emerging industrial chain', the rebound market in the small and medium-sized and micro-cap sectors has been sustainable... Many popular stocks and leading stocks have generally rebounded by more than 30%, which should have a certain incentive effect on the group of funds on the sidelines."

"It's just that the hot spots seem to be too scattered." Zhang Xinlei thought for a while and said, "I'm wondering if it would be better if the funds in the market focused on one main line to create enough market demonstration effects and exceed expectations. Would it be more helpful for the off-site funds to enter the market?"

"I don't think so." Lao Qian said, "A single main line actually has a very limited effect on boosting the overall market. This can be seen from the trends of the weighted main lines in the first half of the year, especially the trends of liquor, white appliances, medicine, consumption, electricity, and finance.

After all, there is a large group of retail investors in the market.

In fact, the core area of ​​holdings is still in the large number of small, medium and micro-cap stocks in the market.

Only when these small, medium and micro-cap stocks show a general rebound trend and achieve a certain profit-making effect can their confidence in going long and increasing their positions be truly stimulated.

Only in this way can the market's bullish sentiment continue to ferment.

Simply concentrating funds to attack one main line will only overdraw the market's bullish power.

Once the group of funds that have been grouped together along this core main line begins to generally take profits and exit the market in large numbers, a sharp drop in the price will most likely follow.

Only rotation can truly stimulate the market's potential long power.

I think this kind of hot spot rotation, the rise and fall of the main line, and the trend of always maintaining the local profit effect are quite good. "

"Yeah, I think so too." Zheng Jinming nodded and said, "In fact, when institutional funds were concentrated on the main line of 'big infrastructure' before, there was not much potential for long positions. The market volume performance at that time was completely different from the current market volume performance."

"The market volume has obviously improved, I think it's because the Shanghai Composite Index broke through 3000 points recently?" He Zhong said, "Why do I feel that it has little to do with whether the main line rotates or not? After the Shanghai Composite Index broke through 3000 points, the market's investment confidence has obviously warmed up, and everyone's expectations for future trends have changed, which has led to some incremental funds entering the market, right?"

"It is somewhat related." Lao Qian said, "If there is no 'emerging industrial chain' as the main line, a number of small and medium-sized stocks and micro-cap stocks rebounded to stimulate the profit effect, it would be difficult for the Shanghai Composite Index to maintain 3000 points. The overall investment confidence and sentiment of the market would also be difficult to stabilize, right?"

"At least from the K-line pattern, the small and medium-sized stocks that are currently biased towards the ChiNext Index, the China Securities 500 Index, and the All-China Securities 1000 Index are expected to have stronger upside potential than the stocks related to the main line of 'big infrastructure' that are currently trading sideways at high levels and are somewhat weak in upward attacks, right?" Zheng Jinming said, "I think the market's rotation trend of switching between large and small caps should continue for a few trading days, and the pattern of the ChiNext Index being stronger than the Shanghai Composite Index will most likely continue."

"From the K-line trend, the ChiNext Index does have a need for a rebound." He nodded, "But this market is really hard to grasp. A few days ago, it was film and television media, Internet applications, and Internet software. This morning, it was 'consumer electronics' and 'Apple industry chain'. This afternoon, it was 'new energy industry chain'... It feels like this so-called rebound line has a very fast rotation. Although the overall trend is upward, the trend of specific stocks is not certain. Take the 'Quantong Education' check for example. It was so strong a few days ago, but in the past two days, it has been significantly weaker than the index trend."

"Well, it is indeed difficult to grasp the market conditions of individual stocks." Zheng Jinming nodded in response, "But the trend of the core leader created by the market should be relatively clear, right? Looking at the market trend, even though the major sectors of film and television media, Internet software, and Internet applications have been adjusted today, the check of 'Huawen Online' is still firmly capped at the daily limit, and it seems that the strength is still increasing.

I think this check has now become the sentiment vane for the entire small and medium-sized cap and micro-cap stocks that are making up for the losses.

Its trend no longer just represents the trend of the 'film and television media' sector.

There is a high probability that as long as the logic of the market's small and medium-sized stocks and micro-cap stocks making up for the rise remains, there will still be a large amount of funds willing to trade along this line.

Then the stock market trend of "Huawen Online" will most likely not die.

We cannot grasp the short-term market trends of other stocks, but the short-term market trend of this check should be relatively certain, right?

Of course, in the main field of "big infrastructure", "Oriental Yuhong" is the core leader of the two cities.

Its current trend is also very good. There is no increase in volume and no obvious signs of acceleration. It is still continuing within the trend of the 5-day line.

The trend of this check is actually quite certain at the moment.

In terms of flexibility, it is probably not as good as the check from 'Chinese Online'.

Moreover, I always feel that the expectations of various market funds for the "big infrastructure" line are changing. Everyone's expectations for the market trend of the "big infrastructure" line do not seem to be as strong as before, and the "big infrastructure" line has actually risen a lot from the bottom.

The core stocks generally rose by around 35% to 50%.

As expected, this increase should have already reflected the changes in fundamentals and the expected explosive performance of many companies this year and next year, right?

In other words, the 'big infrastructure' line is at its current position.

Its investment and speculation cost-effectiveness has been reduced a lot.

On the other hand, for some of the main areas of small and medium-sized and micro-cap stocks that were severely oversold before, since market expectations were overly pessimistic before, now as the market conditions gradually improve and expectations gradually improve, there are opportunities for expectation repair and value reassessment.

In other words, there are actually two lines: the main line of 'big infrastructure' and the 'emerging industrial chain'.

One expectation gap is decreasing, and the other expectation gap is expanding.

I think this is also the fundamental reason why the trend of several hot main lines in the field of small and medium-sized stocks and micro-cap stocks has become stronger than the main line of "big infrastructure" in recent days. "

"The change in expectations is one aspect," said Zhang Xinlei. "I think the main reason why funds are currently concentrated in the field of small and medium-sized stocks is that market sentiment has generally warmed up. As everyone's investment risk preference gradually increases, funds are shifting from certainty to flexibility. As for the so-called change in expectation gap... I don't think it's that obvious. The strong underlying logic of the "big infrastructure" line still exists.

You just mentioned the major sectors and core stocks in the "big infrastructure" line.

The general height of this round of rebound, up to the current position, is only about 35% to 50%.

If we look at the offline real estate housing price increase, the general increase in housing prices across the country, which began in October 15 to date, has clearly exceeded 10%.

Thinking about it from the perspective of house price increases...

Think about it from the perspective of the future expansion of the entire "big infrastructure" industry.

In fact, the stocks related to the main line of "big infrastructure" have not reflected the expectations for the expansion of the industry scale.

In other words, although the valuations of a number of core stocks in the main area of ​​"big infrastructure" have increased slightly compared with previous valuations, they are still considerably underestimated compared with expected changes in the future.

It's just that everyone has different expectations for future performance explosions, and it is impossible to accurately predict the future performance outcomes, which has led to a lot of funds being invested in the "big infrastructure" line, and there are differences between long and short positions. I think that the existence of such differences is actually a good thing.

After all, divergence does not mark the end of a trend.

Didn't you say before that the Oriental Yuhong check is expected to continue to rise based on its current trend?

This is actually the same for the entire "big infrastructure" main line.

Of course, it is expected that the best trend is that the "big infrastructure" line can maintain a relatively strong sideways fluctuation trend.

This will affect the performance of other small and medium-sized and micro-cap stocks, which generally have a lower growth rate than the market average.

It will be able to usher in a smooth compensatory rally.

This will further stimulate the market's bullish sentiment and enhance the overall investment confidence of the market, making the off-market wait-and-see funds more actively enter the market to take over."

"Well, I also think that the current market trend of the 'big infrastructure' line has not yet fully reflected the expected changes in the future." Lao Qian responded, "But in terms of the cost-effectiveness of short-term speculation, the cost-effectiveness of the small and medium-sized stocks and micro-cap stocks is indeed higher."

"Let's just follow the feedback from market sentiment and the main direction of capital concentration." He Zhong thought for a moment and said, "Currently, the market focus tends to be on small and medium-sized stocks and micro-cap stocks, so we should focus on stocks in this direction. If the market focus and the direction of capital concentration turn back to the main line of 'big infrastructure', we will continue to invest in the core leading stocks of the main line of 'big infrastructure'."

"Wouldn't it be better to have a two-line layout and buy half of each of 'Oriental Yuhong' and 'Huawen Online'?" Lao Qian said, "This way, you won't miss out on either."

Zheng Jinming thought for a moment and said, "The key is that when expectations are too consistent, the 'Huawen Online' check may not necessarily provide a buying opportunity. If the check goes up by the daily limit again tomorrow, it will be difficult to take over. The buying point for this check today is during the morning call auction. Once the market officially opens, there will be no buying point."

"If that's the case... then there's nothing we can do." Old Qian said with a smile, "There are so many stocks and opportunities in the market. It's not a big deal to miss one."

As several people had a heated discussion about the market...

The trading hours of the two markets have now entered the last few minutes of the trading period.

Soon after, 3 o'clock in the afternoon arrived and both markets closed.

After a general rebound in the last fifteen minutes of trading, all major market indices returned to their intraday highs at the close.

Among them, the ChiNext Index maintained an increase of 2.15%.

Among the core themes of the two markets, the 'big infrastructure' theme closed near the intraday moving average after violent fluctuations. In the 'emerging industrial chain' theme field, core sectors such as film and television media, Internet software, and Internet applications that had performed well before also fluctuated and closed near the intraday moving average.

Today, the main sector of 'electronic information' has been the focus and chased by many capital groups.

That is, concept sectors such as 'consumer electronics', 'semiconductors', 'Apple industry chain', '5G communications', and concept theme sectors related to the main field of 'new energy industry chain' all eventually closed at the highest point in the session, significantly outperforming the market index.