Rebirth of the Capital Legend

"Actually, the stock 'Oriental Yuhong' is also performing quite strongly," Liang Jiucheng said, looking at the top ten most popular stocks in the market. "Among all the popular stocks, only 'Oriental Yuhong' continued to hit a new annual high today. Moreover, it seemed effortless in reaching this new high, which indicates that the stock's internal shareholding structure remains very stable and is far from being dispersed. Furthermore, it seems that the funds from 'Fuxing Road' that are concentrated in this stock have not yet left."

“Yes, the stock ‘Oriental Yuhong’ that Lao Liang mentioned is indeed performing very strongly.” Zhang Wei nodded and said, “However, it is indeed a bit high. Among all the ‘major infrastructure’ stocks, this stock has probably had the biggest gains in recent months, right? At this price… I really don’t dare to invest heavily in it. Relatively speaking… in terms of short-term trading potential, I feel that ‘Huaxin Cement’ is a better option.”

"Actually, I think that among all the popular 'major infrastructure' concept stocks, such as Huaxin Cement, Shougang Group, Tianshan Cement, Shenhuo Shares, Beijiang Transportation Construction, and Financial Street, Huaxin Cement isn't the most proactive or the strongest," Liang Jiucheng said. "Today, Beijiang Transportation Construction is actually the most proactive and strongest performing stock in the entire 'major infrastructure' theme."

“Yes, indeed.” Upon hearing Liang Jiucheng mention the stock ‘Beijiang Jiaojian’, Zhao Zhiyuan hurriedly replied, “‘Beijiang Jiaojian’ has not opened the limit up since it hit the limit up this morning. Even with the extreme correction this morning, the stock did not break the limit up. I think it’s no problem to say that ‘Beijiang Jiaojian’s’ limit up today is the strongest limit up in the two markets. However, it seems that the market enthusiasm for this stock is not very high. The stocks ranked ahead of it, although they are not as proactive, are still very popular in the market, especially ‘Huawen Online’. The market enthusiasm for it is still rising and is showing a trend of surpassing ‘Huaxin Cement’.”

"With its 'from-the-bottom to-the-top' price movement, a 22% daily fluctuation is bound to be easily recognizable," Zhang Wei said. "Moreover, 'Huawen Online' was already a leading stock and a popular stock in the film and television media sector, as well as the online education sector, so this level of discussion and attention is perfectly normal."

"So, in terms of market enthusiasm..." Zhao Zhiyuan said, "Tomorrow, the market's attention will likely still be focused on 'Huaxin Cement' and 'Huawen Online.' After all, in the afternoon's market performance, apart from the 'new energy industry chain' sub-sector, these two stocks had the strongest driving effect on the market. 'Huaxin Cement' spearheaded a rapid rebound in the 'major infrastructure' main theme, supporting the Shenzhen and Shanghai indices. 'Huawen Online,' on the other hand, spurred a rebound in a number of sectors within the 'emerging industry chain' main themes, such as 'film and television media,' 'internet software,' and 'internet applications,' which had suffered significant losses in the morning. It also boosted the ChiNext index and the rebound of many small and medium-sized stocks in the market."

"The market enthusiasm for 'Beijiang Jiaojian' is not high because there is little divergence in the market, making it difficult for retail investors to participate," Liang Jiucheng said. "But whether it's 'Huaxin Cement' or 'Huawen Online' and 'Beijiang Jiaojian,' as long as market sentiment isn't too bad tomorrow, they should all have a chance to hit the daily limit. And there's a high probability that 'Beijiang Jiaojian' will open at the daily limit."

"'Beijiang Jiaojian' opened at its daily limit?" Zhao Zhiyuan was stunned for a moment, then said, "Brother Liang, isn't your prediction a bit too optimistic?"

"Am I being optimistic?" Liang Jiucheng was equally taken aback.

“I think ‘Beijiang Jiaojian’ stock really needs to open at the daily limit to meet expectations,” Zhang Wei chimed in. “After all, this stock has already performed so strongly today, and it was the only stock in both markets to open at the daily limit with high turnover this morning. Although the market enthusiasm is a bit low right now, this stock itself has a small circulating share capital, not many floating shares, and it doesn’t need a lot of follow-up shares. As long as the market sentiment is somewhat supportive tomorrow, the pressure on this stock to hit the daily limit is actually quite small.”

"Speaking of this afternoon's rapid rebound, there must have been quite a few profits accumulated during the trading session!" Zhao Zhiyuan said. "With so many profits accumulated, can market sentiment be maintained tomorrow? I feel that the pressure for a market correction will still exist tomorrow!"

“Although there were quite a few profit-takers today,” Zhang Wei said, “there was also a significant influx of new funds. Moreover, after the market staged a dramatic rebound, the candlestick pattern has completely reversed. Under these circumstances, most of the profit-taking funds are unlikely to take profits and sell off; they will most likely lock in their positions.”

"Yes, the probability of locked positions is not small," Liang Jiucheng said. "With such two major positive factors today, coupled with the extreme profit-making effect that gathered in the afternoon market, no matter how you look at it, the sentiment after the market closes today will ferment upwards. With the expectation that the sentiment will ferment further, the market trend tomorrow cannot be low. Moreover, a large number of off-market funds have entered the market, which will also provide some support for the subsequent market support."

In other words, even if many funds in the market have made intraday profits, they may have a need to take profits and leave the market.

Therefore, under the influence of extreme emotions, the incremental funds entering the market are also capable of absorbing the selling pressure from profit-taking funds.

Therefore, the market trend tomorrow...

It might not be as drastic as it is today, but there definitely won't be any significant losses.

"Yes, I agree." Zhang Wei nodded and said, "Given today's dramatic reversal, the market will definitely see a sustained upward trend. There's no need to be afraid of a slight rise. In fact, the fact that the major indices recovered today indicates a fully bullish pattern."

"It's not that I'm scared by a slight increase," Zhao Zhiyuan said. "It's just that the market has been quite volatile lately, going up and down a lot, which is very worrying."

“It’s a period of fluctuation, so it’s normal for things to go up and down,” Liang Jiucheng said. “Besides, if the market doesn’t fluctuate wildly, how can we clear out the profit-taking and consolidate the shares? But after today’s extreme volatility, the floating shares in the market can basically settle down for now. I estimate that the subsequent market fluctuations will not be as exaggerated as today or the past few days, and it should stabilize a bit.”

“A stable index is useless,” Zhao Zhiyuan said. “In terms of index trends, the recent trends of the Shanghai Composite Index and the Shenzhen Component Index have actually been quite stable. The key is for the major market sectors to stabilize and develop sustainability. Otherwise, if the major sectors keep fluctuating, it will be difficult to grasp the market rhythm and participate with heavy positions to earn substantial profits!”

"What I'm saying is that the main trend of the market going forward will most likely be more stable," Liang Jiucheng said. "Moreover, the direction of the large amount of funds concentrated in the market will most likely remain on the 'emerging industrial chain' line, focusing on small and medium-sized stocks and micro-cap stocks."

"If things really develop this way, that would be the best outcome," Zhao Zhiyuan chuckled. "The only concern is that the market trend might fluctuate."

"Probably not," Zhang Wei said. "The large group of funds that bought the dip today have finally acquired low-priced shares. They certainly won't let the market fall back down quickly in the subsequent trend, causing them to lose their cost advantage. So, it's highly likely that the market will continue to rise rapidly. After the large amount of funds that bought the dip today have accumulated substantial profits, they may then concentrate on selling to lock in profits. At that time... the market will likely enter a short period of adjustment. Before that... I think there's no need to worry too much. Just aggressively trade based on market hotspots. If you still don't dare to buy heavily at this point, then you're really not suited to survive in this market."

"Haha, that makes sense." After listening to Zhang Wei's analysis, Zhao Zhiyuan couldn't help but laugh and said, "Then let's listen to you two and continue to go long with a large position."

After saying that, he turned his attention back to the stock market.

By this time, the market had already entered the period after 2:30 PM.

Meanwhile, the Shanghai Composite Index, Shenzhen Component Index, ChiNext Index, Huazheng 500 Index, and CSI 1000 Index are clearly still rising and breaking through to the upside.

Furthermore, amidst the continuous upward trend and breakout of the index, the major hot sectors in the market continue to attract active funds.

This is within the main theme of 'major infrastructure' at this time.

The indices of major industry sectors such as real estate, construction and decoration, building materials, non-ferrous metals, steel, and coal have all risen by more than 2.5%, and the total number of stocks hitting the daily limit in the entire "major infrastructure" sector has exceeded 20.

Within the main area of ​​'emerging industrial chains'.

The "new energy industry chain" sector, including related sectors such as "lithium batteries," "charging piles," "complete vehicles," and "auto parts," is experiencing a surge across the board. Among them, the "complete vehicles" and "lithium batteries" sectors have seen intraday gains exceeding 5%, with more than 10 stocks in both sectors hitting their daily limit.

The "smartphone supply chain" sub-sector, including related concept stocks such as "Apple concept," "Xiaomi concept," "semiconductor concept," and "PCB board," has seen its market gains exceed 2.5%. Among them, the "Apple concept" sector index has even reached a 4.5% increase, with most concept stocks within the sector rising by more than 5%. Several core Apple supply chain stocks have been bought up to their daily limit by major investors.

The three sectors of "Film and Television Media," "Internet Software," and "Internet Applications," while lagging slightly behind the other two, have fully recovered their morning losses and are all showing positive territory. Among them, the "Film and Television Media" sector, thanks to the explosive performance of "Huawen Online," has seen its related stocks perform significantly better than those in the other two sectors, with most showing gains of over 2%.

Other sectors are concentrated in small and mid-cap stocks and micro-cap stocks.

Driven by the five major branches of the 'emerging industrial chain', the trends are all good, showing a clear bottoming-out and rebound trend.

As for anything other than these popular themes and sectors...

Regarding the performance of the market's core weighted sectors.

Among the three core heavyweight sectors that performed best in the morning's market trend—liquor, white goods, and banking—liquor and white goods sectors are still in a low-volume, volatile downward trend, with few active buyers and many active sellers, seemingly indicating that a large amount of active capital is concentrated in these two sectors.

As market sentiment rapidly recovers, speculative activity is also picking up quickly.

Everyone is thinking of quickly selling off their holdings and moving on to the hype surrounding the 'emerging industrial chain' and 'major infrastructure' themes.

The banking sector continues to trade sideways.

Other sectors include pharmaceuticals, retail, power, and petrochemicals.

Since these sectors are not the focus of major funds and lack sufficient positive support, the corresponding popular stocks and industry leaders in these sectors have basically followed the Shanghai Composite Index in fluctuations, and the trading volume is not large. It seems that the major funds locked in these sectors have not yet considered leaving the market or adjusting their positions under the current circumstances.

Another area that investors pay less attention to is restructuring and backdoor listings, as well as the ST (Special Treatment) sector.

Generally speaking, these two sectors are where junk stocks gather in the market, and of course, they are also the main places for speculation where mediocre stocks are turned into swans.

At this moment, both of these sectors are facing a lack of certainty.

Basically, it's also in a place that's largely forgotten by the funds in the market.

The performance of various sector indices was basically in line with that of the main board's weighted sector indices, with no significant rises or falls.

Meanwhile, in this trend where all major themes have shown some performance.

At this moment, the number of stocks hitting the daily limit has successfully exceeded 100, achieving a remarkable turnaround from 100 stocks hitting the daily limit down to 100 stocks hitting the daily limit up.

And in the face of such market trends.

As market trading hours continue to advance.

Despite the presence of numerous bullish institutional investors and active speculative funds, the enthusiasm in the market showed no signs of waning. Many individual stocks, core sectors, and key themes saw their upward momentum intensify and their price movements become increasingly aggressive towards the end of the trading day. (End of Chapter)