March 5, 2026, Thursday Review: A Glimmer of Hope

Reviewing yesterday’s market situation: On Monday, 4,282 stocks declined; on Tuesday, 4,807 declined; on Wednesday, 3,640 stocks dropped sharply, with trading volume rapidly shrinking to over 760 billion. Many new investors might not have a concept of this—back at the market’s low point in the first half of 2024, total trading volume was only 500 billion! From yesterday’s perspective, expecting a rebound today is very normal. Our previous review title was also straightforward: “Opportunity to Cut Losses Today.” Based on this, we didn’t hold much hope for the market intraday. [Taoguba]

The recent market performance has been very poor, stemming from the aftermath of January 13. Since the New Year, the situation has only worsened, so our review has been quite direct.

My reviews usually focus on logic, providing a reasoning process rather than guessing blindly. For me, results can come in an instant, but for many beginners, they might think, “Why is it always bad? If I keep calling for a decline, one day I’ll be right.” I’m not bearish; I believe big drops mean big opportunities, small drops mean small opportunities. Today, the main players wasted this chance, making me wonder if they went to a meeting!

The chart below indirectly reflects the index and sentiment: a sharp rise followed by a quick fall! I chose Zhongji Xuchuang because it’s the variable today.

Pre-market news was abundant, especially from external factors. The market opened high, confirming a recovery. After the opening, MicrolLED concepts led the gains. Seeing this, I felt a chill—because the sector indices opened more than 4% higher, all the top gainers had “optical” in their names. This happened yesterday afternoon too, but only those with “intelligent” in their names remained active; afterward, nothing followed.

For quantitative participation, the oil and gas sector has already demonstrated this. My answer is: do not participate. The logic is, high opens are real, but many use methods like one-word arbitrage. You don’t know how much capital recognizes this news, or if the market will smash the consensus at open. If the sector’s hype is intense, it may reverse after a few rounds, and retail investors might cash out that day. Today, Jucan Optoelectronics already broke the limit in the afternoon. The market keeps evolving—previously, such moves would have been cashed out the same day. Extending this, companies like Tongyuan Petroleum, which are like “bottom fishing,” will definitely see attempts. The oil wave was also driven by quant funds. When it adjusts on the third day, some will try “bottom fishing” again.

When I saw these at the opening, I basically understood the result: the main force was uncommitted today. Still, I kept some hope and watched for any signs of strength.

First, look at the overall market direction, which is the only safe zone for short-term traders: power sector, Yunnan Energy Holdings opened with a limit-down, then recovered after the auction. This is the fourth day of such behavior—limit-down then rebound. The attitude toward Yunnan Energy is to hold steady. Yesterday’s market was led by Hang Electric, which guided short-term sentiment, almost hitting the limit, and today it opened high again—showing the power sector’s tolerance for mistakes. Today, the solar energy sector surprisingly emerged. Many might not understand my feeling—these are usually dead zones, yet they showed a trend, connecting to the decline of the aerospace sector. I think the power sector still has operational space, both in timing and style transition (previously suppressed by high pressure, Hang Electric avoided abnormal moves). It’s like a “bad boy” suddenly showing continuity. Hang Electric aims for 200%, but that’s less important now—Tongyuan Petroleum already surpassed 200%, yet no one’s worried. Still, within the rules, it’s better to act honestly. My previous review emphasized acting within rules.

Second, I see power and offshore grid sectors as two different things. Offshore grid equipment has been one of the few sectors not driven by extreme quant. Key players include Dongfang Electric, TBEA, China XD Electric, Baobian Electric, etc. This morning, Hancable exceeded expectations, opening with a limit-up, which is a kind of indirect support. The path for Huashan is clear—no way out. TBEA didn’t fall much even as the index dipped intraday, indicating support. If tomorrow’s action is proactive, it could signal problems. This sector is a feast for holders. Today, the sector’s limit-up count was only two, both in ultra-high voltage (Tongguang Cable, Shunna Shares, Hancable, Jicheng Electronics). Based on the previous main themes—weight, elasticity, limit-ups, diffusion (power, nuclear, stations, PV, energy storage)—these are all present. Power is more suitable for short-term traders.

Third, at the open, funds attacked the MicrolLED direction, but after 10 am, Yixin Sheng initiated a move. I previously mentioned that Yixin Sheng represents attack, Zhongji Xuchuang represents stability, and Tianshi Tongtong is a latecomer. Intraday, I was hopeful, but I focused on two points: who is leading the market now, and the trading volume. Today’s high open was almost a one-step move. Without volume, the trapped positions in Yixin Sheng and Zhongji Xuchuang will be cashed out, causing the index to fall. Any risk of intraday decline means I won’t consider them further. I initially wanted to watch IDC and storage chips, but the market shrank in volume. Usually, shrinking volume is normal, but after yesterday’s 760 billion shrinkage, the dominant stocks were grid equipment, which is not good. Tech stocks shouldn’t be chased today. If tech leads, that’s better. There’s a misconception here—this is from a post-market perspective. During the market, Yixin Sheng and Zhongji Xuchuang had already risen, indicating tech dominance. LED also falls into tech. If today’s LED isn’t driven by quant bulk buying, and Dongfang Electric pulls back after 10 am, then power sector isn’t leading. Oil and gas are not allowed to rise; the market peaks.

Fourth, today’s variable—Yixin Sheng and Zhongji Xuchuang—who leads the index bears responsibility. Normally, intraday, there’s no need to attack these stocks because Ningde Times was also rising. If only for the index, Dongfang Fortune would suffice. But today, the most expensive two stocks were pushed up. This variable shows that the main force gave some sincerity, laying groundwork for later. But if these stocks, like Zhongji Xuchuang and Yixin Sheng, turn into a big bearish reversal tomorrow, the effect fails. Today is about self-rescue. Zhongji Xuchuang closed with only a 3-point drop; given its recent volatility, that’s just a shake. At this point, look at the market’s lower limit—whether AI applications and similar sectors still fall or not. If the upper limit falls but the lower doesn’t, a trend reversal isn’t far.

Fifth, quant trading—recently, due to meetings, news stimuli are frequent, such as autonomous driving (Zhejiang Shibao), computing power (Meili Yun), robotics (Wuzhou Xinchun), hydrogen energy (Jingcheng Shares, Xiongtai Shares), brain-machine interfaces (Yanshan Technology). From oil to smart economy to LEDCPO today, it’s clear the market is being handed over. When does this happen? I think after the New Year, it will be direct. When will the handover return? From two perspectives: first, short-term quant trading and sentiment recognition are obviously flawed—polluted data sets, with people daring to act on early signals, leading to mistakes. Frequent recognition of sentiment can cause market manipulation, with some pushing hot searches and sparking small rallies, which is a flaw. This causes the main force to spend more unnecessarily. Recently, quant methods are unavoidable, but they will soon change. Second, since the main force is willing to spend freely to manipulate, it indicates the market trend is under control. Future opportunities won’t be scarce. Our job is to focus on what we understand and can profit from. Survive first, then seek profit.

Currently, the main force hasn’t returned. Next, we need to watch for restrictions on quant trading. This won’t be announced openly; we can only feel it—less frequent use of quant, not a single sector wildly surging.

Sixth, understand the market and yourself—this has been said many times. Many are suffering now: the market is doing this, others are making money, I’m not; others are bottom-fishing, I want to too. It’s torturous. But this is survivor bias. Clarify each doubt:

First, this afternoon, energy sectors—oil, coal, shipping—rebounded after falling. Then, a news piece caused a collapse. Normally, such a pullback is predictable, but do retail investors know this news? Do they understand the market’s reaction? That’s outside their cognition—an external factor.

Second, on Wednesday, China National Petroleum opened with a limit-down, after two consecutive limit-ups earlier. From a hindsight view, I’d say China Petroleum would rise on Monday and hit limit-up on Tuesday. Do you believe it? Honestly, I don’t. Anyone who told me that would be laughed at as a fool. This is outside my cognition—markets often harvest retail investors with bait. Humans are highly intelligent, but even they can be fooled.

Third, retail investors can’t predict news or sector rotations. Like today’s opening, who could foresee that? Logically, follow the trend. But how many times can this succeed? It happens almost daily. Over a week, five such moves—how many are correct? Survivor bias. If you can’t do it, others can’t either.

Fourth, the market is designed to harvest retail investors. Repeatedly, if they don’t believe, they’ll keep falling for it—like Jiang Taigong fishing, volunteers take the bait. If they don’t believe, what else will they do?

Understanding these issues helps clarify what kind of person you are and what the market is like, so you won’t be anxious.

Seventh, some ask how to respond to current conditions. There are two approaches I’m using simultaneously: first, believing in a long-term bull market, holding low-priced tech stocks, and using T+ strategies; second, short-term, seeking among the few sectors with remaining momentum, trying to find opportunities—better to die in continuation than elsewhere, closer to the answer.

Eighth, with global markets rebounding, US-China conflicts are easing. Now, the internal issues are about how the main force guides the market. The year has just begun. When the market is unpredictable, don’t act rashly or increase positions blindly. Use independent logic with stop-losses to test. Today’s market is a rebound built on continuous lows, indicating it’s still controllable. We often say: does the main force want you to make money? I believe there will be rotation and rebounds. The key is: during rebounds, will you exit or hold?

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