Starting with a fully invested A-share portfolio to become a capital...

Chapter 194 Haitong Foods and the A-share market both plummeted, a real stock market crash was about to begin!
"Smash him to death! Smash that beast Fuchun Road to death! Eliminate this scourge for all stock market investors! Restore a bright and clear world for 1 million Chinese stock market investors! Hahaha!"

Beijing, China.

Inside a military family compound.

When the intraday trading screen displayed over 200,000 sell orders, Chen Xiaoqun, only 14 years old, was so excited that she stood on her chair.

"Smash it! Smash Fuchun Road to death!"

"Justice will ultimately prevail over evil!"

"We are all heroes, hahaha!"

Because he was too young, his values ​​were not fully mature. He believed that the world was black and white, with justice and evil, and that Fuchun Road was the biggest evil villain in the A-share market.

But is Fuchun Road evil?
From the perspective of retail investors, Fuchun Road is indeed a synonym for evil.

Even from the perspective of other speculative investors, Fuchun Road is still the evil side.

It is precisely because retail investors and speculative funds are reaping profits together that Fuchun Road exudes a sense of ruthlessness, as if saying, "I would rather betray the world than let the world betray me."

Throughout history, powerful and ruthless figures have often been misunderstood or even resented.

Because a ruthless tyrant is different from a hero. A hero can sacrifice himself for others without expecting anything in return, while a ruthless tyrant often sacrifices others to achieve his own hegemony.

When a person truly understands that there is no absolute right or wrong in the world, and that differences only stem from different perspectives, then they have mature values ​​and the ability to think independently.

Amidst her cheers, Chen Xiaoqun glanced at the Shanghai Composite Index.

"and many more!"

He abruptly jumped off his chair and quickly switched back to the stock market.

3432 points.

3419 points.

3407 points.

The Shanghai Composite Index is showing signs of a downward trend!

Is it about to break 3400 points?

Chen Xiaoqun clicked on the leading decliners in A-shares and found two familiar figures: the banking sector, which was considered a "stabilizing force," and the securities sector, which was seen as a "bull market leader."

Industrial and Commercial Bank of China (ICBC) is currently trading at 5.21 yuan, down 1.33%; China Merchants Bank is currently trading at 18.63 yuan, down 2.2%; and China Construction Bank is currently trading at 6.29 yuan, down 2.02%. Without exception, all stocks in the banking sector are declining!
The securities sector saw an even more severe correction, with Huaxin Securities, the leading stock, experiencing a 3.33% drop, currently trading at 36.28 yuan.

However, the leading decliners were not banks and securities, but the coal sector, with Huaguo Shenhua currently trading at 39.5 yuan, down 4.1%.

Clicking on the sector decline at this point allows for a more direct observation of the "flood discharge."

The aquaculture sector fell by 3.76%.

Steel sector: down 2.91%.

Real estate sector: down 2.3%.

Oil sector: down 2.22%.

Looking across the market, the entire A-share market is declining. The Shanghai Composite Index has broken through 3400 points and is currently at 3398, a drop of 2.12%. The Shenzhen Component Index is currently at 13623 points, a drop of 2.02%. The decline in heavyweight index stocks far exceeds that of small and medium-sized stocks, which has directly caused panic among retail investors.

[Burying Love is also Love]: No, what bad news has happened again? Why is the A-share market experiencing another sharp correction?
[Please don't be obsessed with me]: Damn it, I just added to my position and it immediately pulled back. Who said A-shares wouldn't fall before Everbright Securities went public?

[Cricket Fly]: According to reliable sources, aliens have attacked! Everyone should immediately liquidate their stock market positions so I can buy at the bottom!

[I Will Not Cheate]: Chasing high prices will impoverish three generations, buying low will make you rich and handsome, and I'm going to ruthlessly buy the bottom from you guys who are out of the market, hahaha!
[Coffee Youth]: Luckily, I cleared out half of my positions. This kind of one-sided upward trend is the easiest to go wrong. I was really smart, haha!

According to data from Eastmoney and Tonghuashun, retail investor activity tends to increase sharply during stock market downturns.

Why did it rise in a straight line?

It's like being beaten; only tough guys can hold back their yelling!

Because they can't hold back, once a market downturn or crash occurs, many retail investors will come out to show off their losses and make comments such as "buying the dip and adding to their positions" and "the bull market is turning around."

The inexplicable pullback across all sectors in the A-share market has left countless retail investors anxious and scrambling to find the reasons for today's decline.

At that very moment, Caiyan.com released its interpretation of the "China Monetary Policy Implementation Report for the Second Quarter of 2009" at a speed far exceeding that of Eastmoney and Tonghuashun.

[Key Summary from Caiyan.com]: The People's Bank of China released the "China's Monetary Policy Implementation Report for the Second Quarter of 2009," clarifying that it will continue to implement a moderately loose monetary policy and emphasizing maintaining reasonably ample liquidity in the banking system to support stable and rapid economic development. This document is the first to propose "dynamic fine-tuning" of the loose monetary policy. Currently, both the Shanghai Composite Index and the Shenzhen Component Index have fallen by more than 2%.

"I'll go, so soon?"

Are all the editors at Caiyan.com monsters?

"Copy it! Copy the summary directly from Caiyan.com! We absolutely cannot let retail investors go to Caiyan.com!"

"Hurry up!"

"Take action!!!"

Less than half a minute after Caiyan.com released the policy summary, the editorial teams of Eastmoney, Tonghuashun, and even Tencent Finance, Sina Finance, and NetEase Finance were shocked. They had only read half of the document, and you had already sent out the summary? How could you be so absurd?

Smaller financial websites did not hesitate to copy the content published by Caiyan.com.

The editorial teams of leading financial websites such as Eastmoney and Tonghuashun still maintained a bottom line. Instead of completely copying and pasting, they quickly reviewed the contents of the "China Monetary Policy Implementation Report for the Second Quarter of 2009," compared it with the content on Caiyan.com, and then rewrote and published it.

Even though the editorial teams at Eastmoney and Tonghuashun reacted extremely quickly, their policy interpretations were still released at least 3 minutes slower than those on Caiyan.com.

Countless retail investors saw the published interpretation and instantly realized the truth.

[Xiaoying Doesn't Eat]: Oh no, the loose monetary policy is going to be "dynamically fine-tuned," does this mean they're going to tighten the money supply?

[Alone on the West Tower]: Of course! Market funds are very sensitive!

[Call Me Extraordinary Brother]: I have a friend who took out a bank loan of 50 yuan and threw it into the stock market. He made hundreds of thousands of yuan in this round of rise. If there is no slight adjustment, the bubble will be huge!
When Li Daxiao, the "bullish governor," saw the two major indices plummet, he immediately recorded a video to reassure his fans.

"Good morning, comrades. On this beautiful morning, as of 9:49 a.m., the two major A-share indices seem to have experienced an unpleasant drop, with the Shanghai Composite Index falling below 3400 points."

What caused the decline?

Li Daxiao posed the question, and then answered it himself: "If nothing unexpected happens, it should be mentioned for the first time in the '2009 Second Quarter China Monetary Policy Implementation Report'. Note that it is the first time that dynamic fine-tuning has been mentioned."

"Is dynamic fine-tuning the same as tightening?"

"uncertain!"

"The document clearly states that a moderately loose monetary policy will continue to be implemented to maintain reasonably ample liquidity in the banking system in order to support steady and relatively rapid economic development."

"Besides dynamic fine-tuning, there is also rapid development, which is also full of information, so comrades, don't panic, don't panic, let us firmly believe in the arrival of the bull market!"

"Go for it! Development is booming!!!"

As Li Daxiao's "cattle-raising videos" were released on various platforms, all his followers received update notifications.

All of a sudden.

Hundreds of thousands of retail investors clicked on his video.

[Culprit]: It turns out some bastard deliberately stirred up trouble. Damn it, it scared me so much I almost sold everything.

[Nangong Wanting]: I knew things weren't that simple. Thank you, stock market guru Da Xiao, for supporting us retail investors.

[Down with the evil Fuchun Road]: A sharp drop is a market correction, while a slow drop is a real drop. Everyone should remember this saying. Also, listen to Teacher Da Xiao's advice: buy good stocks, be a good person, and you will be rewarded.

[High Heels Slave]: I can't imagine how rampant those beasts spreading rumors would have been if Teacher Da Xiao hadn't enlightened us. Thank you, Teacher Da Xiao, for revealing the truth to us!

Less than half a minute after Li Daxiao posted his video blog, the panic among stock investors was greatly alleviated, and the two major A-share indices gradually stopped falling and began to trade sideways.

……

Financial Research Network office space.

Finance meeting room.

Seeing that the A-shares market had started to trade sideways, Liao Guopei turned his attention back to Zhang Yang and asked, "Joker, is this dynamic fine-tuning of monetary policy really that powerful? It actually caused a 2% drop across all sectors in the A-shares market."

"A collective plunge, terrifying!"

Lin Guangchang echoed in agreement.

As the editor of "Financial Research Network" who issued policy interpretations, Zhang Yang thought for a moment and explained in the simplest language: "After such a long period of one-sided rise, the A-share market is like a balloon that has been fully inflated and has reached its critical point. Any slight disturbance could cause it to explode."

"The profits have been realized, right?"

Lin Guangchang inquired.

"Yes, too many profits have been accumulated, but the A-share market is not lacking in greedy people. You can tell by looking at the current trading volume."

At Zhang Yang's prompting, Liao Guopei and Lin Guangchang opened the market funds page.

"The Shanghai Composite Index saw a trading volume of 204 billion yuan, a 27% increase year-on-year, while the Shenzhen Component Index saw a trading volume of 117 billion yuan, a 36% increase year-on-year. Is this really a case of buying on dips?"

Lin Guangchang couldn't understand why retail investors would buy more as the price fell.

Of course, this doesn't mean you can't buy more when prices fall, but buying more should be done with discipline.

Take his investment strategy as an example: first buy 20%, if it drops 10%, buy more, and if it drops further, immediately cut losses and exit the market, with the loss amount being 5.8% of the total position.

Why is it necessary to cut losses?

Because we made a mistake in this round of trend analysis.

It's like a train heading to another city. You intended to go to Hangzhou, but you got on the wrong train to Guangzhou. The best course of action is to get off at the nearest station and buy a new ticket to Hangzhou. This is what speculative investors often refer to as timely loss-cutting.

The legendary speculator Jesse Livermore was even more decisive. He would not add to his position, but instead buy in at 20% and cut his losses as soon as the price dropped by 10%, resulting in a total loss of only 2% of his position.

If he gets the trend right, for example, if it rises by 10%, he will immediately add 20% to his position, and if it continues to rise, he will add another 20%.

Using this strategy, Jesse Livermore became a legend.

His trading strategy is simple in some ways, but difficult in others; the key lies in whether the trader has sufficient discipline.

Because he was trading based on trends, he would immediately cut his losses if the direction was wrong.

What about ordinary retail investors?

If a stock drops by 10%, people will wonder if it has bottomed out.

Let's see if we can add to our position.

After adding to their holdings, the stock price drops by another 10%, and they'll start to wonder if it's bottomed out.
Let's see if we can add more shares.

If the price drops by 10% after two additional purchases, they'll think, "We're already so badly trapped, why not add another position? Maybe it's the bottom?"
With an initial investment of 20% of the funds, and three additional 20% investments, retail investors unknowingly invest 80% of their funds. At this point, they become even more reluctant to cut their losses and leave the market.

It's no exaggeration to say that this is the mindset of 98% of retail investors in the A-share market when they lose money.

Strict adherence to discipline and the courage to correct course are essential qualities for becoming a speculative investor; they are the most fundamental things.

It's worth mentioning here that continuous buying and continuous declines are not necessarily wrong. There is no absolute right or wrong in the world, and the stock market is no exception. Continuous buying and continuous declines are applicable when market makers suppress prices.

For example, take coal. The country is now vigorously developing clean energy, and traditional energy seems to be about to be phased out. However, if you believe that thermal power will still be the mainstay in the future, then buying more as prices fall is your judgment on the overall trend, not your judgment on individual stocks.

To put it simply, there is no absolutely profitable strategy in the stock market. Instead, you need to develop a trading strategy based on the actual situation, and if you find something is wrong, cutting your losses and leaving the market immediately is the best course of action.

"The more it falls, the more you buy; the more you buy, the more it falls. Most retail investors buy stocks based on their feelings. It would be an injustice if they didn't lose money," Liao Guopei replied to Lin Guangchang's question casually.

"I see it."

Lin Guangchang nodded.

Zhang Yang remained calm and replied, "The A-share market has only been developing for a short time, less than 20 years. It's normal that retail investors haven't kept up with the mindset, and that's also our opportunity."

"Joker is right. If retail investors don't lose money, who will pay for our gas?" Liao Guopei said half-jokingly.

"It seems...that's indeed the case." Lin Guangchang instantly understood.

The stock market does not create wealth; it merely acts as a wealth transporter. If retail investors don't lose money, who will speculative capital profit from?

Waiting for dividends from listed companies?
That's pure nonsense!
While chatting with Liao Guopei and Lin Guangchang, Zhang Yang didn't forget to send out the edited game notifications.

[Financial Research Network Intraday Reminder]: The Shanghai Composite Index has broken through the 5-day moving average and formed a trend top divergence with the MACD indicator. The DIFF line and DEA line have formed a death cross, and the KDJ indicator has also formed a death cross. Combined with the dynamic fine-tuning mentioned in the "Second Quarter 2009 China Monetary Policy Implementation Report" and the recent loan withdrawal behavior of major banks, the current investment risk in A-shares is extremely high!
Zhang Yang had already foreseen the crumbling state of China's stock market, and he was no longer conservative, describing it as "extremely risky."

As the intraday risk warning was issued, all members of Caiyan.com received this risk pop-up message.

[Little Cat Meow Meow Meow]: Joker is indeed the commander of the air force. He came to talk down the stock market as soon as the A-shares fell.

[Who is whose]: I've really sold all my shares. This is the first time I've ever seen Joker say "extremely risky investment." The A-share market might really be about to collapse!
[Jinyi Yexing]: That's ridiculous! Teacher Daxiao is still shouting about the bull market. If you're bearish on A-shares, you're bearish on the Chinese economy. In the past, you would have been whipped into a spinning top.

[The wind howls and the Yi River is cold]: It would be great if Joker, the clown, came out. I'll go all in and slap him in the face!
[Yixiao Qingcheng]: Compared to Joker, I still think Daxiao is awesome. Let's protect Daxiao's development!

Because Li Daxiao correctly predicted the rise of A-shares in the first half of the year, the number of retail investors who believe him is now hundreds of times greater than those who believe Zhang Yang.

but.

Zhang Yang didn't care.

Reason has nothing to do with height. Who is right and who is wrong will be answered by the A-share market in the future.

……

11 points.

The A-share market closed in the morning session.

The Shanghai Composite Index and the Shenzhen Component Index failed to rebound, both falling by more than 2%. The former even fluctuated around 3400 points, attracting the attention of countless technical analysts.

As the saying goes, novices die trying to catch the bottom, while veterans die during market fluctuations.

Sideways consolidation is the most common and longest-lasting trend.

It can take anywhere from a few days to several months, or even several years.

To succeed in the A-share market, one must learn to profit from sideways trading and fluctuations; this is an essential path for technical traders.

There's a saying in the racing world: Anyone can accelerate on a straightaway; speed on the corners is what truly matters!
Sideways movement and fluctuations are the bends in the stock market. By navigating these bends, the accumulated capital can be several times that of other stock market investors.

"Hello, Mr. Liu."

At a Shandong cuisine restaurant in Building A of Changtai Plaza, Zhang Yang, Liao Guopei, and Lin Guangchang had just sat down when Zhang Yang received a reservation call from Liu Hua of Hongyue Investment.

"Are you busy, Brother Zhang?"

"I just went out for lunch. Is there something you need, Mr. Liu?"

"Let's talk about the lazy economy. My friend who does venture capital said he wants to meet you this Saturday night at 8 pm at the Peninsula Hotel."

"The Peninsula Hotel?"

"what happened?"

"This place doesn't seem to be open for business, does it?"

"Oh right, it's not open to the public yet. The Peninsula Hotel is only open to a limited number of people right now."

"So that's it."

Zhang Yang suddenly realized.

As a seasoned player in the hotel industry, he naturally knew that high-end hotels would invite some high-net-worth clients to experience the hotels for free before their official opening and point out any shortcomings.

Zhang Yang had heard of this luxury hotel located on Dongshan Road.

"Yes, Saturday. Do you have time? If not, we'll reschedule."

"How could I not have time? I will definitely keep my appointment."

"OK."

The two chatted briefly for a while before hanging up the phone.

"Saturday night at 8 pm, the Peninsula Hotel in Huangpu District," Zhang Yang murmured to himself, silently noting down the time and place.

Because the discussion was conducted with economic giants such as Li Yining and Cao Fengqi, the "lazy economy" received their endorsement to some extent.

Capital is ubiquitous; it will not let go of any opportunity to increase its value. As Lenin said, "For money, capitalists will sell the rope that hangs them."

Many people might think this statement is a bit too extreme. How could a capitalist sell the rope that would hang himself?
However, history tells us that capital has indeed sold the noose that strangled it time and time again.

Capital cannot stop appreciating; it needs to keep generating profits. Just like the average person's monthly salary aspirations: when it's 3000, they crave 5000; when it's 5000, they crave 8000; when it's 8000, they crave 1; and once they actually reach 1, they will pursue 2, 5, and 10.

Stop?
It's impossible to stop.

Because capital appreciation cannot stop, Zhang Yang has received no fewer than 10 calls from venture capitalists in the past two days, all wanting to learn about the specifics of the "lazy economy."

……

1 pm.

The two major A-share indices fluctuated again.

Both the Shanghai Composite Index and the Shenzhen Component Index rose, with the banking sector, a stabilizing force, leading the way by forming a lower shadow.

All of a sudden.

The stock market investors were in an uproar.

[Campus Belle's Baby]: Banks are rising! Attention all departments! Attention all departments! The banking sector is rising! A-shares can still rise! Our A-shares can continue to rise!

[I must marry Liu Yifei in this lifetime]: Bank stocks surged in the afternoon. Is it really necessary to be so violent? Could it be that the A-share market rally is not over yet?

[Little Sheep Loves Stocks]: Buy more! Buy more!

[Who Stole My Cow]: As expected, Teacher Da Xiao was right! A-shares can still rise, and the bull market is continuing!

The stock market has recovered from a drop of only about 0.3%, and countless investors are already excited. Some have even plunged into individual stocks to find out what's going on.

However, the law of A-shares plummeting remains unchanged. This is a legacy tradition and something that every new stock investor must experience.

Starting at 2 PM, the A-shares market, which had initially shown signs of recovery, lost momentum again and began to decline.

Not only A-shares, but also Hong Kong stocks experienced a sharp drop after 2 p.m., and none of them could escape the decline.

Some people, refusing to believe the superstition, continued to add to their positions.

Some people were afraid of heights and chose to leave.

Some people are still observing.

Someone is ready to make a move.

Investors in both A-shares and Hong Kong stocks were engaged in a gamble, but as 3 p.m. approached, A-share investors ceased their trading for the day.

The Shanghai Composite Index recovered the 3400-point mark, reaching 3428.5 points, a drop of 1.24%, with a trading volume of 2409 billion yuan.

The Shenzhen Component Index fell slightly, by only 0.87%, closing at 13782.94 points, with a trading volume of 1222.4 billion yuan.

It's not hard to see that on August 5th, the A-share market was led by large-cap stocks, while small and medium-cap stocks were the more resilient sectors.

As of 4 p.m., the Hang Seng Index in the Hong Kong stock market closed at 20494.77 points, down 1.45% with a volatility of 2.69%.

There is no doubt that the Chinese stock market is experiencing a collective decline today.

Meanwhile, Chen Sanrong, far away in Shenzhen, was still undecided.

Expose Liao Guopei...

It will do you nothing but harm.

Let's not expose Liao Guopei...

He really can't swallow this!

Chen Sanrong decided that as soon as he could get out of Haitong Foods, he would expose Liao Guopei's shady dealings.

If he really suffers seven or eight consecutive losses, he'll have to seriously consider admitting defeat to Liao Guopei.

Meanwhile, Su Jing of Huitianfu Fund is meeting with other fund managers tonight to discuss how to manage Haitong Foods.

Now, Su Jing is left with only two paths.

1. Selling at the daily limit down.

2. The market is consolidating and waiting for the right moment.

Why didn't it rise?

With that ruthless manipulator, Fuchun Road, around, how dare they push up the price?
Moreover, the most critical problem is that if these institutions are the ones driving up the price, where will they find buyers to support their positions?
Now, when retail investors hear that Fuchun Road is part of Haitong Foods, they completely ignore any of your ridiculous hype and deliberately avoid it.

It's worth mentioning that on August 5th, Haitong Foods' total trading volume was only 3200 lots, with a turnover of 2.3 million.

What is the concept of 230?
To put it simply, today's trading volume was less than one-tenth of the previous trading day's, which falls into the category of "dead stocks" and represents a lack of support.

Given this situation, who would dare to push the price up?

Even if someone dares to drive up the price, who will they sell to?
After much deliberation, Su Jing realized that only two options remained: cashing in profits or waiting for the market to consolidate.

If they choose to sell, they can make a profit and leave the market, since their holding cost is very low. Even if there are four more limit-down days, the institutions will still have a certain profit.

As for the sideways trading and waiting for time to pass, the core logic is to wait for Yijing Optoelectronics to be acquired through a reverse takeover, but no one knows when Haitong Foods and Yijing Optoelectronics will reach an agreement.

Another noteworthy point is that Haitong Foods' interim report showed a large amount of bank loans, indicating a desperate determination to fight back, perhaps because they themselves did not want to be acquired by Yijing Optoelectronics through a reverse takeover.

……

Thursday, April 8th.

Thursday is the three-day billing day for reverse repurchase agreements. If you buy a reverse repurchase agreement on this day, you can receive three days' worth of interest in one day.

As the time reached 9:14, countless stock market investors began to eagerly anticipate the day's trading.

Yesterday, the Shanghai Composite Index climbed back above 3400 points, leading countless investors to wonder if it was just a "bull market slump."

What is cow faking a fall?
This is somewhat similar to a limit-down during a major upward trend. For example, after two consecutive limit-up days, the price falls to the limit-down price and then continues to rise to the limit-up price. That limit-down is called a "false drop," which is a common tactic to shake out retail investors.

After being shaken out multiple times, some people have even created a special "First Yin Strategy" to specifically target popular stocks that have hit their daily limit down.

However, the wishes of retail investors are ultimately just wishes. When an avalanche comes, no snowflake is innocent.

[Stock Anomaly Alert]: Huaguo Bank has seen a massive sell order of 1100 million.

[Stock Anomaly Alert]: China Construction Bank has seen a massive sell order of 1200 million yuan.

[Stock Anomaly Alert]: Agricultural Bank of China saw a super sell order, amounting to 1000 million.

[Stock Anomaly Alert]: A super sell order of 2700 million yuan appeared in ICBC.

Banks dumped shares, banks dumped shares, after banks dumped shares, securities companies dumped shares...

[Stock Anomaly Alert]: Huaxin Securities has seen a massive sell order of 2000 million yuan.

[Stock Anomaly Alert]: A super sell order of 700 million yuan appeared in GF Securities.

[Stock Anomaly Alert]: A super sell order of 1000 million yuan appeared in Changjiang Securities.

Stocks crash, stocks crash, after stocks crash, coal crashes...

[Stock Anomaly Alert]: Huaguo Shenhua saw a super sell order of 3000 million yuan.

[Stock Anomaly Alert]: Yankuang Energy saw a super sell order, amounting to 1700 million.

[Stock Anomaly Alert]: China Coal Energy has seen a super sell order, amounting to 1200 million.

The massive amounts of shares appearing in various sectors have terrified all stock market investors.

No one expected that the Shanghai Composite Index, which had risen for four consecutive days, would approach 3300 points in just two trading days.

[Little Red Flower]: Why did it drop again? What happened?

[Lonely Wolf]: Something's not right, something's really not right, something bad might have really happened. Four trading days' worth of losses isn't even enough to cover the losses of two trading days.

[Sleepy King]: You son of a bitch, are we going to reach 3200 points already? Holy crap!

Such a significant pullback has sobered up some retail investors, who are no longer blindly adding to their positions but are instead waiting for the bottom to appear.

By 10:40 AM, something even more alarming than the surge in trading volume had occurred: the A-share market was showing signs of declining trading volume.

If yesterday morning's high trading volume was due to blind buying or profit-taking, then today's low trading volume can only be explained by one reason...

What reason?
Retail investors didn't sell their shares!
It is often said that "volume and price are king," and trading volume is the strongest market indicator.

Yesterday's 1.24% drop and today's breach of the 3400-point level, heading straight for 3300 points, coupled with declining trading volume, is a very dangerous signal of a continuous downward trend.

Why is it a signal of a continuous downward trend?

Let's put aside the overall market and take individual stocks as an example.

If you were the market maker and wanted to shake out weak hands, you would sell off your shares and drive down the stock price to create a panic atmosphere and force retail investors to sell their shares at a loss.

What will happen when chips are exchanged?
Trading volume!
The stock price fell, but there was no trading volume, indicating that retail investors have not yet sold at a loss.

If retail investors don't sell at a loss, and you're the market maker, you can only cooperate with the spread of false information to continue driving down the stock price.

Don't sell after one limit down.

Should I sell if the stock hits two consecutive limit-down days?

If they don't sell and there's no significant increase in volume, then either the price will continue to fall and then consolidate sideways.

However, if the trading volume increases significantly, it indicates that retail investors in the stock have sold at a loss. Once enough shares have been sold at a loss, a new round of price increases can begin.

This is also the basic logic behind the common saying, "If the volume decreases and the price falls, it will continue to fall."

Upon seeing the "two consecutive declines," Li Daxiao of Yingda Securities felt a cold sweat break out on his forehead and muttered to himself, "Could the national team be pulling a contrarian tactic to deceive us bullish investors?"

His bullish outlook wasn't blind; rather, it stemmed from the fact that the government had prepared dumplings for China Construction for two months, and now that Everbright Securities was also nearing its IPO, shouldn't we add some dumplings to this dish as well?
Thinking of this, he still believed in himself and immediately posted a video to comfort retail investors.

[There will be times when the wind and waves will be strong, and we will set sail to cross the vast ocean. Comrades, comrades, don't panic! The Chinese stock market is about to experience its second bull market correction. As the saying goes, a bull market correction is a rare opportunity. Comrades, your time to be tested has come. Let's cheer for this golden bull market!]
[Go, Qianjinniu!]
The release of Li Daxiao's video has once again stirred up a huge wave, with the previously sluggish trading volume of A-shares showing a slight increase.

Meanwhile, in the comment section of the video blog post, a large number of retail investors are still following suit.

[Jelly Popsicle]: A bull market is a rare opportunity, trust Teacher Da Xiao, trust Qianjin Bull, I'm going all in. If you bet right, you can come to Shenzhen to find me. Limited to girls over 18 who have never had a boyfriend.

[A Big Banana]: Buy good stocks, be a good person, and you'll be rewarded. Just do it!
[Da Xiao Stock God]: Full rallies, full rallies, a bull market pullback is priceless!
Each individual investor's bet carries the gambler's belief.

The stock market is a casino, but it's not entirely a casino; it's more like a wealth distribution arena, allocating money to those who are clear-headed.

……

The next day, February 8th.

As 9:15 approached, investors who were hoping for a "bull market rebound" were utterly disappointed. The Shanghai Composite Index and the Shenzhen Component Index fell again, and the decline was much greater than in the previous two days.

Li Daxiao of Yingda Securities was completely stunned. Even with the air conditioning on, sweat continued to seep from his temples.

"despair--"

Sweat dripped down and onto the ground.

Only then did Li Daxiao realize that he might have really made a mistake in his approach.

Like Li Daxiao, Chen Sanrong, far away in Shenzhen, was also sweating profusely from his temples and forehead, like a waterfall.

After three trading days and three consecutive limit-down days, Haitong Foods' stock price has fallen to 5.83 yuan, and his total holdings have reached 1300 million yuan, a decrease of more than 600 million yuan.

"no!"

"no!"

"If I fall any further, I'll be ruined!"

Now, not only is Chen Sanrong in a state of panic, but Bai Lei, the receptionist at China Merchants Securities, is also in a state of panic. The 7 yuan "sugar baby fee" that Chen Sanrong promised her has not yet arrived, and she has every reason to suspect that he wants to take advantage of her for free!

(End of this chapter)