[Red Packet] Dry Goods Post (3) What are the buying opportunities and selling risks mentioned by the master teacher? Explained using Friday's market action (313)

Winning soldiers win first and then seek battle; defeated soldiers seek battle first and then aim for victory.[Taoguba]
This market is never short of opportunities; what’s lacking is the calm patience to wait and self-awareness. Look inward, and you can anchor your direction amid fluctuations. Wait for the wind, follow the trend, and let compound interest work miracles.
The core of trading is never about frequent trades. Keep your mind steady, avoid being easily influenced by market volatility, follow your plan, plan your trades, multiply your position size based on your win rate and odds, and perfect your trading system.
Slow down, move forward steadily—that’s true speed; after all, flowing water doesn’t compete to be first, it strives to flow endlessly.
If you don’t understand market styles, rotation styles, and how markets break through rotation, read this post: https://www.tgb.cn/a/2pdpk2DjD1z. If you don’t understand short-term chip structures and their impact on trading, see this post: https://www.tgb.cn/a/2pxwWkXjp7b. The live broadcast everyone’s been waiting for explains buy divergence turning into convergence, sell convergence turning into divergence, as well as expectations,超预期,预期差, and more. https://shuo.tgb.cn/shuo/toViewShuo?shuoID=2028284274696695885#type=zblb. This playback segment covers chip game, capital intentions, node consensus—review these two live sessions and two articles carefully, repeatedly watching them three to five times, and it will help you avoid many detours.
Like first, then watch—profit steadily over the years~! Like while watching—keep your thoughts clear~! Thanks a lot~!
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1. What is a buying opportunity, and what is a selling risk
Today’s market plunged significantly, and many people probably feel uncomfortable. Let’s discuss this market drop today. I’ve mentioned before in live sessions about buy divergence turning into convergence, and sell convergence turning into divergence—hope you still remember.
What am I going to talk about today? It’s about buying opportunities and selling risks, or rather, unconfirmed buy signals. What does unconfirmed buy or sell mean? This is what the stock trading teacher once said: when you buy a stock, you believe it will rise the next day, so you buy. Now, reflect on this: often you see a stock surge intraday, and you don’t even know what the stock is doing, yet you buy it directly. Do you really understand what you’re buying? Or are you just seeing it go up and fantasizing it will keep rising, so you buy? Are you making a rational decision based on analysis, or a pre-market plan about how far it can go, what supports the sector, and how market sentiment reacts? If so, you buy because you believe it will rise.
Or, you watch the market aimlessly during trading without a plan. When the market fluctuates and a stock suddenly surges, you don’t know if it’s the first or second to be pushed up, what news triggered it, or whether it’s the main trend or just a secondary move, or unrelated altogether. You chase and buy blindly.
After buying, you then try to understand the logic behind the stock—why it’s rising. If you lose money because of this, can you blame others?

Now, back to the core: what is a buy opportunity and what is a sell risk? It’s about every time you open a position, you must clearly understand your logic—are you riding the wave or leading it? If leading, does the sector have sustainability? Is market sentiment supportive? Is the current market style conducive? If it’s a follow-up move, is the rally height sufficient? Is there a risk of a pullback? Is the overall market still in a strong upward trend?
If these conditions aren’t met, then there’s no reason to believe the stock will continue to rise.

For example, if you buy a trend-following stock, like Huasheng Tiancheng, I’ve mentioned that it formed a low-buy high-sell upward trend in recent days. Before this trend breaks, don’t exit prematurely.

This stock recently established a trend—buy low, sell high daily. When you buy based on this trend, if you already hold a position, you can also reduce it as it rises, maintaining your core position. Small gains of 3 or 5 points intraday are profit; don’t be overly sentimental—be brave to buy and sell. It’s hard to catch the absolute high or low; it’s about increasing gains during upward fluctuations.

When to sell? Only when the pattern breaks—say, at the close of day 312, if after a buy-in, it doesn’t surge or makes a lower intraday low than yesterday, and the high doesn’t surpass yesterday’s high, combined with reduced buying volume, then you should reduce your position when the stock pulls back, as the confirmation weakens or risks emerge.

If you happen to buy on that day expecting it to close red or surge, but it doesn’t, you should lower your expectations. It’s normal to be disappointed when your initial expectation isn’t met. Sometimes, luck is on your side, and it surges right after you buy.

The core is: if you expect it to turn red or hit new highs but it doesn’t, and it follows Huagong Tech’s rise, but you bought early in the day and can’t sell intraday, you need to anticipate its next-day trend.

If it gaps up or down the next day, that’s a trend signal—decide whether to reduce your holdings based on the overall market sentiment.

If it gaps down and continues to fall, check if it breaks the 5-day moving average or the low of yesterday’s holdings. Can the pullback to the moving average be predicted? Are related stocks also falling or consolidating?
Does your stock’s trend match your original expectation, or has it deviated? If it deviates, that’s your sell point or at least your reduction point. High-risk traders will still choose to sell.

This is about buy opportunities and sell risks or unconfirmed signals.

Trend stocks’ buy/sell points mainly depend on support levels—daily moving averages, previous highs, whether the stock can break resistance, and whether chips are concentrated and oscillate.
Generally, if the 5, 7, 10, 20-day moving averages or intraday averages can’t hold, or if the stock can’t stay above support and pulls back, that’s a sign to reduce positions. More detailed signals include MACD divergence on 30-minute or 60-minute charts. That’s about trend stocks.

For core short-term stocks with strong momentum, like yesterday’s Jinkai Xinneng, which surged significantly before noon, the key is proactive and driving power. When doing short-term trading or streaks, focus on two things: initiative and momentum. Although Jinkai Xinneng didn’t surge early in the day, after green energy stocks rose, it led the afternoon rally, showing strong driving power. Its surge caused other stocks to follow. As the first to rise in the afternoon, it demonstrated good initiative. This is often called a sector backflow—stocks that surge the next day at a premium or even with a one-word limit-up.

Today, if we expect it to open above 7% or hit a limit-up based on yesterday’s strong move, but it only opens near zero, that’s well below expectations—either due to heavy selling pressure or lack of follow-through. When you see this, it’s a sell signal.

So, during the short-term, when the stock’s rise is far below expectations, traders tend to sell. This also involves stocks like ShunNa Shares, which opened lower and failed to rebound strongly, or experienced secondary declines.

Back to the essence: when you buy, you believe there’s a specific upward opportunity. If the next day’s action doesn’t meet that expectation, you must sell decisively to prevent losses from expanding.

Of course, current quant strategies and market rotation create opportunities for recovery, but these rebounds are unconfirmed and vary across stocks. Only in a rotation-driven bull market can you attempt such trades. Since rotation and the associated loss mitigation aren’t normal, if you lack top-tier market adaptability, it’s better to stick to the basic logic of buying the strong and selling the weak—especially in bear markets or environments with thin trading volumes, where holding losing stocks can lead to big losses.

Returning to buy opportunities and sell risks or unconfirmed signals:

Often, we need to prepare a plan for the next day. What does that mean? It’s about understanding the environment—how your stocks are likely to move—so that your expectations align with market reality. Continuously match and overlay your expectations with market conditions. When your forecast and the market’s are aligned, your judgment is accurate.

Constantly analyze how your stocks will move the next day—what’s within expectations, what exceeds expectations, and what falls short. Make precise judgments and pre-emptive adjustments so that you’re not caught off guard at the open. When your stocks behave a certain way, you’ll know whether to sell or hold. Decide whether to sell in parts or all at once.

For example, yesterday I added a breakout stock, Shuangyi, a 20cm arbitrage, because recent wind power stocks have reached a certain level. The 20cm wind power component stocks are relatively few. When wind power surged yesterday, Shuangyi, a major exporter of wind power parts to Europe, also surged strongly. Today, it opened about 5% higher, and I sold at the opening. The main reason was that Jinkai Xinneng’s surge was below expectations, and ShunNa’s secondary decline after green energy’s move also dragged the sector down.

As a sector leader, Jinkai Xinneng’s performance indicates strong driving power. If the next day opens above 7% or hits a limit-up, that’s expected. If it only opens near zero, that’s below expectations—either due to heavy selling or lack of momentum. When your target is a 7-8% gap-up or a limit-up, but it only opens near zero, that’s a sign to sell.

So, during the day, if the sector or stocks underperform, it’s natural to reduce positions. This also involves stocks like Sunna Shares, which opened lower and experienced weak rebounds or secondary declines.

In essence, when your entire portfolio or individual stocks underperform or break support levels, it’s a signal to sell. When I reviewed Ningbo Construction on Wednesday, I judged the sector’s weakness early on, and it followed the overall market trend.

When the sector’s recovery falls short of expectations, the buying power diminishes, and without unexpected positive events, a further decline is likely.

In the morning, after a low open, the market quickly rallied. I analyzed this in my comments. If the market surges sharply, what could happen? I explained this to everyone.

As expected, the market continued to fall after the initial rebound, but when it reached deep support levels, I told everyone what I was doing.

What did I do? I used my own example to illustrate the main theme: buy opportunities, sell risks, or unconfirmed signals. I subjectively judged that the market had fallen enough, and as long as there are no major geopolitical events over the weekend, the market has become desensitized to US-Iran tensions, and oil stocks are no longer strongly correlated with futures. I believe technology stocks are likely to recover strongly on Monday.

I plan to buy back my sold positions if the market opens as I expect. If Monday’s market opens below my expectations, I’ll sell again. But when I see a buy point within my understanding, I will act accordingly.

Trading isn’t random; it requires market prediction, understanding, and follow-through. When expectations aren’t met, sell.

Back to the market itself: on Friday, leading stocks are consolidating after a decline, power stocks are also falling back. From the power sector, it’s been rising for days, but on Friday, a significant divergence appeared. China Power Construction and China Energy Construction led the rebound, providing some support. Keep an eye on whether the sector is truly recovering or if there’s a broader shift. The power sector’s recent big drop might be followed by a correction, which should face more resistance. The sector’s correction and the sector’s chips’ correction are similar.

When the rotation continues, it affects capital’s willingness to invest in sustained trends—investors worry about no follow-through the next day, leading to more chaos. Power stocks’ opening declines, like Ningbo Construction (-2), Litong Electronics (-3), Hongjing Technology (-4), Meili Cloud (-4), Capital Online (-2), Runze Technology, Wavemaker, and Wangsu Technology—all opened lower. If you’ve read the previous sections and understand the need for expectations, then when you see your stocks falling below support and breaking support levels, it’s a sign to reduce.

On Wednesday, I held Ningbo Construction, and during the review on Thursday, I judged the power sector’s weakness. It initially showed some recovery but was dragged down by the overall market, moving in sync. Remember?

When the sector’s recovery is weaker than expected, the buying power is exhausted, and without unexpected positive events, a further decline is likely.

In the morning, after a low open, the market surged quickly. I analyzed this immediately in my comments. If the market surges sharply, what could happen? I explained this to everyone.

As expected, the market continued to fall after the initial surge, but when it reached deep support levels, I told everyone what I was doing.

What did I do? I used my own example to illustrate the main theme: buy opportunities, sell risks, or unconfirmed signals. I subjectively judged that the market had fallen enough, and as long as there are no major geopolitical events over the weekend, the market has become desensitized to US-Iran tensions, and oil stocks are no longer strongly correlated with futures. I believe technology stocks are likely to recover strongly on Monday.

I plan to buy back my sold positions if the market opens as I expect. If Monday’s market opens below my expectations, I’ll sell again. But when I see a buy point within my understanding, I will act accordingly.

Trading isn’t random; it requires market prediction, understanding, and follow-through. When expectations aren’t met, sell.

Back to the market itself: on Friday, leading stocks are consolidating after a decline, power stocks are also falling back. From the power sector, it’s been rising for days, but on Friday, a significant divergence appeared. China Power Construction and China Energy Construction led the rebound, providing some support. Keep an eye on whether the sector is truly recovering or if there’s a broader shift. The power sector’s recent big drop might be followed by a correction, which should face more resistance. The sector’s correction and the sector’s chips’ correction are similar.

When the rotation continues, it affects capital’s willingness to invest in sustained trends—investors worry about no follow-through the next day, leading to more chaos. Power stocks’ opening declines, like Ningbo Construction (-2), Litong Electronics (-3), Hongjing Technology (-4), Meili Cloud (-4), Capital Online (-2), Runze Technology, Wavemaker, and Wangsu Technology—all opened lower. If you’ve read the previous sections and understand the need for expectations, then when you see your stocks falling below support and breaking support levels, it’s a sign to reduce.

On Wednesday, I held Ningbo Construction, and during the review on Thursday, I judged the power sector’s weakness. It initially showed some recovery but was dragged down by the overall market, moving in sync. Remember?

When the sector’s recovery is weaker than expected, the buying power is exhausted, and without unexpected positive events, a further decline is likely.

In the morning, after a low open, the market surged quickly. I analyzed this immediately in my comments. If the market surges sharply, what could happen? I explained this to everyone.

As expected, the market continued to fall after the initial surge, but when it reached deep support levels, I told everyone what I was doing.

What did I do? I used my own example to illustrate the main theme: buy opportunities, sell risks, or unconfirmed signals. I subjectively judged that the market had fallen enough, and as long as there are no major geopolitical events over the weekend, the market has become desensitized to US-Iran tensions, and oil stocks are no longer strongly correlated with futures. I believe technology stocks are likely to recover strongly on Monday.

I plan to buy back my sold positions if the market opens as I expect. If Monday’s market opens below my expectations, I’ll sell again. But when I see a buy point within my understanding, I will act accordingly.

Trading isn’t random; it requires market prediction, understanding, and follow-through. When expectations aren’t met, sell.

Back to the market itself: on Friday, leading stocks are consolidating after a decline, power stocks are also falling back. From the power sector, it’s been rising for days, but on Friday, a significant divergence appeared. China Power Construction and China Energy Construction led the rebound, providing some support. Keep an eye on whether the sector is truly recovering or if there’s a broader shift. The power sector’s recent big drop might be followed by a correction, which should face more resistance. The sector’s correction and the sector’s chips’ correction are similar.

When the rotation continues, it affects capital’s willingness to invest in sustained trends—investors worry about no follow-through the next day, leading to more chaos. Power stocks’ opening declines, like Ningbo Construction (-2), Litong Electronics (-3), Hongjing Technology (-4), Meili Cloud (-4), Capital Online (-2), Runze Technology, Wavemaker, and Wangsu Technology—all opened lower. If you’ve read the previous sections and understand the need for expectations, then when you see your stocks falling below support and breaking support levels, it’s a sign to reduce.

On Wednesday, I held Ningbo Construction, and during the review on Thursday, I judged the power sector’s weakness. It initially showed some recovery but was dragged down by the overall market, moving in sync. Remember?

When the sector’s recovery is weaker than expected, the buying power is exhausted, and without unexpected positive events, a further decline is likely.