Rebirth of the Capital Legend

"Hey, after 2 o'clock, the market has turned its divergence into consensus." Zhang Xinlei, among the major speculators of the Suzhou Group who were watching the market trends, was surprised to see the market trend getting stronger in the final hour of trading, with all major indices beginning to climb. "I thought today's market trend was doomed, but I didn't expect..."

"It's mainly the market-weighted mainline that's driving the index up again," said Lao Qian in the group. "After the Shanghai Composite Index surpassed 3100 points, the stimulus effect on the market became completely positive. So, seeing the Shanghai Composite Index choose to break upward, the short-term capital groups in the major mainlines naturally began to continue to buy in the late trading stage, hoping to seize the first move at tomorrow's opening. I think this is easy to understand."

"Yes, that's right." Zheng Jinming nodded and said, "It seems that there are indeed many short-term investors in the market who are trying to get ahead of the curve tomorrow. Many stocks that have performed well in the past are now actively pushing up. It seems that this time... there is no doubt that the Shanghai Composite Index will officially break through 3100 points and hold this level."

"The Shanghai Composite Index's continued upward breakthrough also proves that the signal of last Friday's reversal trend was effective." He Zhong said, "It seems that the core and main line of attack of this round of market is still not very clear. The two lines of the new energy industry chain and large-scale infrastructure are too consistent at present, which is not good. The smartphone industry chain is insufficient in size and has limited capital carrying capacity. The emerging industry chain, whether it is film and television media, internet software, or internet application sectors, lacks the support of underlying logic, making it difficult to form market synergy. In general, it feels that the active capital groups in the market are still a bit fighting on their own at this stage. This trend of being unable to form a unified force on a major main line will probably bring a lot of interference and uncertainty to the subsequent market trends!"

"It's not like they're all fighting on their own, right?" Zheng Jinming responded. "Looking at the overall market trend today and last Friday's market performance, a large number of investors are still relying on the two core themes of large-scale infrastructure construction and the new energy industry chain.

The reason is that the popularity of these two main market lines is not very high today, and people are not discussing them very intensely.

These are mainly the two main lines. After today's opening, there were not many differences in the market, and many funds could not participate at all.

For example, in the new energy industry chain, the core leading stocks in related industry sectors and concept sectors such as complete vehicles, auto parts, auto decoration, automotive electronics, lithium batteries, and charging piles were directly blocked by large orders the moment the market opened today, leaving no opportunity for other capital groups to participate, let alone the opportunity for a large number of retail investors to follow suit.

In this case, most people cannot participate, so naturally the discussion will not be very heated.

This is a hotly debated topic.

We still have to wait until this line shows certain divergent market trends, and when a number of core leading stocks within this line show fluctuating market trends.

Maybe the market discussion will heat up.

Similarly, the situation in the major infrastructure sector is similar to that in the new energy industry chain.

When the market opened this morning, a number of industry sectors such as real estate, construction decoration, building materials, nonferrous metals, steel, coal, and a number of related concept sectors all had too strong consensus expectations, resulting in no good opportunities to participate in the corresponding core leading stocks at the opening.

Such as Oriental Yuhong, Northern Xinjiang Communications Construction, Tianshan Cement... and many other stocks.

After opening high, a large amount of funds quickly rushed to buy the daily limit, and the stock has never opened again since then. Under such circumstances, how can the market discussion heat remain high?

Even the leading stocks in the core industries within these two main sectors basically opened significantly higher.

The market expectations are too consistent, so naturally the discussion heat is relatively low.

Let’s take a look at the smartphone industry chain and the emerging industry chain. The reason why they are more discussed than the main line of large infrastructure and the new energy industry chain is because these two lines have shown significant divergences in their trends during today’s trading.

Especially the smartphone industry chain, which has been unanimously pessimistic since the opening.

After the market opened in the afternoon, Changying Precision's stock price quickly hit the daily limit, which quickly drove the trend of stocks related to the entire smartphone industry chain.

That is, obvious differences are transformed into consistent trends.

Under this trend, a large number of capital groups in the market can fully participate in it, and a large number of retail investors who follow the trend can also actively participate in it.

When all capital groups present can participate freely.

Especially when there are still certain differences in the market trend.

Naturally, the market discussion will be very heated. After all, arguments and disagreements will always quickly generate topics and heat.

Similarly, in the main areas of the emerging industrial chain, the trends of film and television media, Internet software, and Internet applications also have this characteristic.

When the market opened in the morning, these major sectors were actually relatively weak.

However, later, because the stock of Huawen Online was suddenly pulled out from deep water and quickly got out of the daily limit with continued explosive volume, it led to a continued rebound of the corresponding core stocks in the major sectors of film and television media, Internet software, and Internet applications.

Driven by the stock of Huawen Online, several sectors including film and television media, Internet software, and Internet applications are also underway.

Naturally, there is also a process from disagreement to consensus.

This also created a strong topic.

However, compared with the smartphone industry chain, the market trend of this sector is slightly weaker and the market differences are also greater.

Comparing these two lines, I feel that the smartphone industry chain line is stronger.

in summary……

I think that in the current market trends, the trend hierarchy of the major main lines is still relatively obvious. The two main lines of large-scale infrastructure and new energy industry chain are the strongest, followed by the smartphone industry chain. Finally, the main line of the emerging industry chain mainly composed of film and television media, Internet software, and Internet applications has a relatively obvious improvement and reversal trend, which can be regarded as the landing point for market funds to switch between high and low levels.

As for sectors that tend to be towards the main board, such as liquor, white goods, medicine, consumption, electricity, finance, petrochemicals, etc.

It has always been the area where the main capital groups in the market are concentrated.

I feel that the trend of these weighted main lines is actually not much different from before.

"If we're talking about betting on these major themes, I estimate the upside potential is limited. However, given the current valuation levels and market dynamics, it's unlikely we'll lose money." "Hmm, Lao Zheng's analysis makes sense," Lao Qian nodded in the group, adding, "The market's various themes do have a clear hierarchy. It's just that before the major infrastructure and new energy industry chains see a significant resurgence and a second divergence, it's hard to say whether the market can achieve a formal breakout from its current position."
After all, given the current volume, if a large number of funds outside the market do not intervene further on a large scale,
It is difficult to support the concentrated upward movement of multiple core lines in the market.

In fact, looking at today's market trends, it is quite obvious that a large number of short-term profit-taking funds are taking profits and locking in profits.

Overall, there are differences in the major main lines of the market.

On the contrary, it seems that the main weight line in the direction of the main board has relatively smaller differences. Of course... this is also the main weight line. It has not risen much recently, and the short-term profit accumulated on the market is relatively small. In addition, due to the recent market trends, it continues to lean towards the small and medium-sized and micro-cap stocks.

Therefore, in the weighted main line areas, there is a continuous outflow of short-term funds.

This has led to insufficient buying capacity in the entire weighted main line area.

But now the situation seems to be improving significantly. I think... if the market volume cannot continue to support the general rise in the market.

Then, the divergent trends of the major market lines become inevitable.

In other words, in the subsequent market trends, the main trend lines will inevitably fluctuate and will not continue to attack upward in such a consistent manner. "

"Well, I couldn't agree more." Zhang Xinlei nodded and said, "Given the current volume, it's really difficult to support the market's continued upward trend. The divergence of the major main lines should be a high-probability event in the subsequent market development. Since the divergence of the major main lines in the market is a high-probability event, I don't think we need to focus on any one core line, nor do we need to analyze which core line is the strongest in the market."

He Zhong pondered for a moment and said, "It's still necessary to analyze it. After all, even if there is a divergence in the strongest market core, the market's potential buying willingness will be much stronger than that of the weaker main line. In addition, the fault tolerance rate will also be significantly higher.

Take the core line of large-scale infrastructure and the emerging industrial chain as an example for comparison.

The core leading stocks in the three sectors of real estate, building decoration, and building materials have shown strong fluctuations in recent trends, with many limit downs and limit ups, but they are still far behind the popular stocks in the film and television media, Internet software, and Internet application sectors.

It is obvious that the fault tolerance rate of stocks such as Beijiang Communications Construction, Huaxin Cement, Oriental Yuhong, and Tianshan Cement.

It is significantly higher than a large number of stocks such as Huawen Online, Huawen Media, Guangdong Media, Huace Film & TV, Baofeng Technology, Quantong Education, etc.

Buy the core theme of large-scale infrastructure and the leading stocks of the corresponding core sectors.

Even if the buying point is not right for the time being and the purchase price is a little higher, there is still strong potential buying and the influence of retail investors following the trend.

There is a high probability that if you hold on for a while longer, you can reduce your losses slightly, or even make money.

However, we should hold the leading stocks of the corresponding core sectors of the emerging industrial chain, such as the core leading stocks of film and television media, Internet software, and Internet applications.

Unless you buy the stock of Huawen Online, it is basically difficult to make money.

Moreover, even if you can hold on for a while longer, you will eventually make money.

That is also due to the good market trend itself and the performance of the index, rather than the trend of the sector or the independent trend of individual stocks.

Therefore, from the perspective of market tolerance, focus on core stocks and identify core leading stocks.

I think it is still quite important.

Of course, in terms of current participation, since the major infrastructure and new energy industry chains have shifted from divergence to convergence, there are basically no opportunities for participation on the market. Therefore, participation naturally falls into the two major areas of the smartphone industry chain and the emerging industry chain.

"Tolerance and participation should be viewed relatively." Zheng Jinming partially agreed with He Zhong's opinion and continued, "Let's analyze the specific situation. Currently... if you want to participate, in terms of cost-effectiveness, the smartphone industry chain and the emerging industry chain, such as film and television media, internet software, and internet applications, are the most noteworthy sectors. As for other core sectors, there are currently few differences and few opportunities for participation.

The large-scale infrastructure line and the new energy industry chain line have the strongest performance compared to other main market trends.

However, there is no opportunity to participate in the corresponding core leading stocks.

And the increase is generally higher.

If we further overdraw expectations on these core leading stocks and wait until these stocks diverge at the opening before participating... I think the cost-effectiveness of the game will not necessarily be better than the current core leading stocks in the smartphone industry chain, as well as the core leading stocks in the fields of film and television media, Internet software, and Internet applications. If I have to choose... I will definitely choose the one with better cost-effectiveness.

Of course, if it is a number of core leading stocks in the main fields of large-scale infrastructure and new energy industry chain.

Those that can offer a good low-level buying opportunity are naturally the core leading stocks of these core main lines, which offer better value for money.”

"Haha... I agree." Lao Qian in the group laughed and said, "The buying point is not fixed. You don't have to chase high prices for core leading stocks. As the saying goes, good stocks must have good prices to make stable profits. If good stocks don't have good prices, it's naturally difficult to make money."

"Well, as Lao Qian said, good stocks also need good prices. This is indeed very important." Zhang Xinlei nodded.

And with the continued discussion among the main speculators of the "Suzhou Group".

As market trading hours continue to progress...

After the Shanghai Composite Index surpassed 3100 points, it continued its upward climb. Encouraged by this breakthrough, various sectors and stocks related to small-cap and mid-cap stocks saw a surge in short-term buying, following the index's upward momentum and accelerating their upward trend. (End of Chapter)