Rebirth of the Capital Legend

"Old Wu is right." Xu Qiao stared at the frozen market of the two cities and immediately took over the conversation, saying, "From the current macro-level analysis, the incremental funds flowing into the stock market will not be too much. After all, the central bank does not have many cards to use for liquidity easing. In addition, the real estate market continues to siphon macro funds, so the funds that can actually flow into the stock market may be extremely limited.

At the same time, there is no reversal in industry fundamentals and no real expectation of performance explosion to support the rising momentum of stock prices. It is really unlikely to turn the rebound into a reversal by relying solely on concept stories and short-term positive news support, given the huge amount of historical trapped stocks in the early stage.

Also, judging from the historical trend cycle of the main market in the past...

I think that the current 'emerging industrial chain' line, especially the Internet software, Internet applications, film and television media, Internet finance... these lines that were severely hyped in the last bull market, most likely have sufficient room for cyclical adjustments, but there is still a clear lack of time cycle.

At the same time, the bear-bull conversion cycle of the entire market is actually lacking in time period.

The time period is insufficient, and it is difficult for the internal historical trapped chips to truly settle. In this way, even if some incremental funds intervene, the pressure for upward breakthrough and reversal will be quite large.

Based on past market cycles...

Generally speaking, this time period has to last for two or even three years before a real reversal can occur.

Now, I think both the macro and micro conditions are insufficient.

Since the conditions for a market reversal are not sufficient and there are no conditions for large-scale incremental funds to enter the market, it is highly likely that future market developments will still be a stock game.

Since it will still be a market structure of stock game, and the line of "emerging industrial chain".

There is also no underlying logic for a fundamental reversal.

I think the primary targets of both on- and off-market funds, as well as the primary investment points of many institutional main funds, will still be the main lines of "big infrastructure" with relatively abundant liquidity, corresponding underlying logic support, and current valuations still within a reasonable range, as well as the main lines of weight such as liquor, white goods, medicine, consumption, electricity, and finance. "

"At present, the macro conditions for large off-market funds to enter the market are indeed not sufficient." After hearing Xu Qiao's analysis, Brother Chen, who had been thinking, also responded at this time, "The Federal Reserve has entered the interest rate hike channel, and central banks of various countries will most likely follow suit. In the process of the US dollar tide developing towards the interest rate hike trend.

Global capital liquidity will generally show a tightening trend.

What's more, my country's current interest rate level has already dropped to the lowest level in recent years, and the central bank does not have many cards in its hand.

Even considering the issue of economic development, we will not rashly follow the interest rate hike.

There won’t be much room for further interest rate cuts for the time being.

This means that domestic macro liquidity will most likely become increasingly tight in the future, especially during the period when the Federal Reserve enters the interest rate hike channel.

In other words, the hot money in the market will be reduced overall.

And as enthusiasm continues to decline, the real estate market is still siphoning liquidity.

This has led to a tightening of macro-level liquidity, especially the macro-capital liquidity that can flow into the stock market, which is more serious than everyone expected.

And since the real estate market is siphoning a large amount of market liquidity.

At the same time, the potential conditions for funds available to flow into the stock market are not only not more relaxed than before, but are even more tense than before.

From the underlying logic, it is unlikely that the stock market will welcome a large amount of incremental off-market funds.

Without the entry of a large number of off-market funds into the market, the market can only maintain a situation of game between existing funds.

That is to say, the overall valuation level will most likely be difficult to improve without a significant increase in funds.

Especially in the last bull market, too much capital was invested in the above industry sectors.

These sectors have too much historical locked-in shares, and in the absence of sufficient incremental growth, the upper pressure range is quite difficult to resolve without sufficient time.

Instead, it is the main line of "big infrastructure", as well as the main sectors such as liquor, white appliances, medicine, consumption, electricity, and finance.

Due to changes in their industry fundamentals and the decline in valuations brought about by the surge in performance, the investment value of the leading stocks in these industry sectors has become prominent. They are likely to become the main source of funds in the market and continue to speculate or invest in these areas.

At the same time, these main sectors did not generate too much bubbles during the last bull market.

There won’t be too much historical locked-in shares accumulated.

It seems that the core stocks of these industry sectors have a large market cap and huge circulating shares. In fact, the potential pressure to pull up these stocks is worse than the chip structure, and the pressure is much smaller than that of many main-line stocks of the "emerging industrial chain" with heavier historical locked-in shares.

At present, the underlying logic of the market has not changed.

The continuous turmoil of the 'emerging industrial chain' in recent days should be regarded as an oversold rebound, and cannot be simply judged as a reversal. The main line of the adjustment of the 'big infrastructure', as well as the main sectors of liquor, white appliances, medicine, consumption, electricity, and finance, when the valuation and expectations have not been fulfilled, and the future expectations are still increasing, the adjustment... is still not a good buying point. "

"Yes, I think we should not be swayed by emotions." Old Wu smiled and said, "We should look at the problem beyond emotions. Xiao Xu and Brother Chen both made very good points. The 'emerging industrial chain' line seems to have a strong profit-making effect, the enthusiasm for speculation is very high, and the capital chasing is also very hot, but... if you look closely at the core stocks related to this main line, their stock price trends still have not touched the core locked-in area above, which means that their upward trend is still unclear.

There is also the main line of the entire 'emerging industrial chain', except for the two small-sized branch sectors of 'consumer electronics' and 'security lenses'.

For other industry sectors, there is indeed no underlying logic for improvement in industry fundamentals.

Even in terms of news...

The strength of relevant policy support is difficult to compare with the main line of "big infrastructure" in the previous period.

While the improvement in the industry fundamentals of the two sub-sectors, 'consumer electronics' and 'security lenses', will undoubtedly be difficult to drive up the valuations of stocks related to the entire 'emerging industrial chain' main line.

The reason why this line has been so eye-catching recently is that short-term funds are concentratedly speculating on it.

This is mainly because after the market actually broke through 3000 points, the market's overall investment enthusiasm and investment risk preferences were mobilized.

There are also many branch sectors in the main field of "emerging industrial chain". There is indeed a serious oversold state.

At the same time, the main line of "big infrastructure", as well as individual stocks in the main sectors such as liquor, white appliances, medicine, consumption, electricity, and finance, have accumulated a large number of profit-taking chips after the previous continuous rise, and have fulfilled part of the expectations. They need a short adjustment space to release the internal profit-taking selling pressure and re-condense a new chip structure.

In other words, the current main line of "big infrastructure", as well as the upward momentum of the liquor, white appliances, pharmaceuticals, consumption, electricity, and financial sectors, have indeed weakened slightly compared to before, so a large number of active short-term capital groups in the market will switch between high and low at this time.

In short, it is the current explosion of the "emerging industrial chain".

It happens to be in line with the short-term trend of the entire market.

However, this kind of fit is short-term, its sustainability is questionable, and there is no underlying logical support.

Moreover, looking at today's market sentiment feedback, I feel that the sentiment of the 'emerging industrial chain' line has reached its climax.

This is against the backdrop of immature fundamentals for large-scale influx of incremental off-market funds into the market.

With sentiment at this point, the possibility of continued fermentation is probably not very high. Moreover, the follow-up funds and incremental off-market funds that can be attracted by the spread of sentiment will most likely show a diminishing marginal effect.

After all, it has become so popular.

If the performance continues to exceed expectations, more funds will be needed to take over.

This is still very difficult when the market as a whole maintains a stock game.

In other words, sentiment cannot continue to rise, and at the same time, the positive news and policy aspects have basically been released. The corresponding main-line hot stocks have also completed the expected oversold rebound in the continuous rebound for several consecutive days, and many stocks have also begun to touch the more serious historical trapped area above.

In this case, it is likely that the funds that come in later to take over will find it difficult to make any profit, right?

Moreover, some of the short-term profit-taking funds currently in the market will most likely reduce their positions and take profits under the influence of the subsequent marginal decreasing follow-up funds.

In other words, the current main line of the 'emerging industrial chain'.

Not only is it not suitable to continue increasing positions and continuing to go long, but it is already time to reduce positions while you are ahead, or to clear positions and take profits.

Of course, if the 'emerging industrial chain' line begins to enter a period of ebb in sentiment and capital speculation, I think the 'big infrastructure' line that has continued to underperform the market in recent days, as well as the heavyweight lines such as liquor, white appliances, medicine, consumption, electricity, and finance, are very likely to have opportunities again. "

"What the three of you said does make some sense." Lao Zhang pondered for a while and responded, "It seems that we should change our thinking and start reducing positions and taking profits in the 'emerging industrial chain' line. However, although the market's internal market trends have fluctuated, the overall upward trend should not change for the time being, right?
Today is the last trading day of this month and also the monthly landing point of the K-line.

Looking at the monthly K-line charts of the Shanghai Composite Index, Shenzhen Composite Index and ChiNext Index, it is obvious that all major indexes have formed a bullish trend.

Especially the Shanghai Composite Index, which closed with two consecutive red monthly lines. It looks like a monthly level rebound cycle after the bottom is found, and it is likely to continue to explore space upward.

In other words, analyze from a technical perspective.

At present, we cannot be negative in the overall bullish and bearish views, but should still be optimistic.

It’s just that after the sentiment of the ‘emerging industrial chain’ line was fully reflected, the landing point has returned to the main line of ‘big infrastructure’, or the main lines of liquor, white appliances, medicine, electricity, consumption, and finance. ”

"From the technical perspective of the K-line pattern, this round of rebound cycle has indeed not ended." Xu Qiao said, "But there have been two consecutive red K-lines, and I don't think there is much room for rapid upward movement. We can be optimistic, but we must be cautiously optimistic.

Also, I think the fundamental reversal in the real estate market will most likely not be reflected in the performance reports of companies in the industry chain so quickly.

In other words, this is the core theme that currently supports the market to move out of this rebound cycle.

That is, in the main area of ​​"big infrastructure", a number of core leading stocks may still find it difficult to meet expectations in the performance reports of the next one or two quarters.

And when expectations cannot be fulfilled in performance for the time being.

Naturally, there will be more and more ghost stories in the market, and it will be difficult to form a relatively consistent bullish force.

Therefore, I think that this round of rebound trend of the Shanghai Composite Index, Shenzhen Composite Index, and ChiNext Index will not be smooth sailing. The trends of the major core lines are likely to fluctuate in the coming period.

However, I am more optimistic about the liquor and white goods line.

Due to the rapid growth of the real estate industry and this year's weather conditions, the performance of these two sectors should be reflected earlier than other sectors in the entire real estate industry chain."

"The liquor consumption sub-sector will indeed have a relatively strong future certainty once the cycle reverses," said Chen. "That is why so many institutions have invested in this sub-sector, and the corresponding first-tier liquor brand stocks have such a stable stock price trend."

"Brother Su's Huayi Capital has the largest holding weight in the liquor sector, right?" Old Wu said, "Looking at the semi-annual report of Qianzhou Moutai, its holding weight in this sector has not decreased at all, but has increased a bit."

"Brother Su really loves the liquor sector now," said Lao Zhang. "According to preliminary estimates, Huayi Capital holds at least 300 billion yuan in liquor industry shares, which is much more than the position held by this institution in the main line of 'big infrastructure'."

"There's nothing we can do about it." Brother Chen said, "The larger the amount of capital, the more we need certainty."

Xu Qiao nodded and said, "That's true. Looking at Brother Su's current investment style, I really can't find any trace of his previous investment style."

"But there is still no need for us to do this." said Lao Zhang.

"Of course." Xu Qiao nodded. "The size of the funds is not at the same level, so the trading model, method and approach cannot be copied. Short-term gambling is more exciting and more suitable for me."

After saying this, he turned his attention back to the two stock markets that had already been frozen, as well as major stock investment exchange forums across the Internet.

At this moment, on major stock investment exchange platforms, countless retail investors are discussing the main line of the "emerging industrial chain" related sectors, which have performed very well and have a very strong profit effect, especially the core hot leading stocks of the film and television media, Internet software, and Internet applications sectors. They are already fully optimistic and there is basically no short-selling disagreement. (End of this chapter)