The market is sluggish; when will the market trend recover?

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Market Summary: Today, the index opened with low volume and a slight decline. After opening, sectors like chemicals, wind power, air thermal pumps, and medical devices rotated to strength, while electricity diverged. In the afternoon, the index led a pullback, with the number of advancing stocks dropping from over 3,500 to 1,500 at close.
Market Performance: Power grids, green electricity, wind and solar energy storage, and chemicals showed slight strength.
Trading Difficulty: Difficult (Easy, Medium, Difficult, Hell)
Highlights: Structural opportunities, trend-following, mainly low buy-ins, avoid chasing acceleration on divergences, do not chase continuous rises.

1. Trading Review

1. Yesterday’s analysis warned of risks at high power levels, and today confirmed Dayi’s judgment. Most high-level power stocks offered exit opportunities early in the session. The low-level continuous boards showed divergence, with only Huadian Energy successfully hitting the limit. China Power Construction, at even lower levels, hit the limit but failed to drive power stocks higher. Chemicals initially showed strong momentum but couldn’t sustain throughout the day; many chasing gains early on pulled back. Aside from power (including wind power) and chemicals, most sectors lacked sustainability. The uncertainty remains high, so Dayi still advises controlling positions.

2. Market Review
Today, 1,502 stocks rose, 3,828 fell, with a total turnover of 2.2554 trillion yuan, shrinking by 186.5 billion from yesterday. The index opened with low volume and a slight decline, then sharply dropped in the afternoon before recovering to close with a medium shadow line. Wind power, energy storage, and chemicals showed weak divergence rotation; power grid equipment diverged and weakened. North American computing power stocks like CPO, PCB, and liquid cooling performed poorly, with only a few stocks showing activity.

Throughout the day, 59 stocks hit the limit-up (up from 52 yesterday), with a 77% limit-up rate (up from 71%), and 51 stocks hitting the first limit-up (up from 44). There were 13 limit-downs (up from 2).
From the perspective of consecutive limit-ups, short-term relay suppression remains evident. The market is cautious, with double-digit limit-down stocks indicating weakening sentiment.

In sectors: chemicals hit 12 limit-ups, wind power 8, energy storage 6, lithium batteries 3, controlled nuclear fusion 4, smart grids 2, optical communications 2, coal 2.
The sector rotation today is clear, with a lack of focus but overall revolving around power, chemicals, and energy.

Auction order:
Zhongnan Culture added orders (yesterday 1.238 billion), but missed orders during trading, with intra-day turnover of 516 million.

3. Market Analysis
Main Market
The index rose slightly today with a volume of 2.25 trillion yuan, shrinking and declining, indicating poor support. The intra-day recovery leaned toward conflict, with increased divergence in power and computing sectors. The weekend external environment remains bearish, so tomorrow is likely to open lower. If the opening gap is small, the recovery may lack strength and revert to divergence. If the gap is large, consider trading the intraday low-high opportunity (control position). Currently, risks are concentrated externally; the index may hit new lows short-term, possibly forming a new bottom. Conservative investors can wait for opportunities.

Direction
On Friday, power grid stocks faced major divergence at high levels, with domestic computing, cloud computing, and related sectors weakening. These sectors are mostly aligned; power grid stocks are relatively resilient. For recovery, focus first on power grid stocks; even if they recover, individual stocks will present opportunities, but sector-wide strength is hard. When selecting stocks, avoid high-fake new highs; indices and sectors are unlikely to continue rising, and new highs tend to be quickly realized.

Lobster concept stocks are affected by market safety concerns, with divergence lasting four days. Friday also saw significant losses. Market feedback on lobsters is worsening, and even if there’s a recovery, it’s unlikely to last. The safety issues related to lobsters are hard to resolve in the short term, but if resolved, focus on domestic computing power, leasing, and cloud services, as applications lack scarcity.

Today’s weak divergence in wind and solar energy storage sectors remains, with expected divergence tomorrow. If strong low-level stocks support, the sector may continue rotating. The logic is similar to energy substitution caused by oil price rises and the Strait of Hormuz issues, but at lower positions. If chemicals show losses, be cautious of risks.
Chemicals showed weak divergence today; external factors over the weekend favor chemicals, but domestic policies on fertilizer supply and price stabilization may cause high opening and subsequent pullback.

Overall, current speculation revolves around energy (wind, solar, storage), power (computing synergy, green power, nuclear), and chemicals. While seemingly focused, the market is scattered, individual stocks are not concentrated, making operation difficult.

4. Profitable Stocks Currently
There are no clear leaders; analyzing from sector perspective reduces stock value. Here are some core stocks with potential:

Hua Sheng Tiancheng: Huawei Ascend, trend deteriorating, wait for stabilization.
Hua Gong Technology: wait for stabilization.

Xiexin Energy Tech: expected to rise then fall.
Jinkai New Energy: expected to open low and rise.
Hanlan Co.: expected to open low and weaken.
Shunna Co.: expected to open low and weaken.

China Energy Construction: expected to open low and fluctuate.
Yuneng Holdings: expected to stabilize after opening low.

Ningbo Construction: expected to stabilize after opening low.
Meili Yun: expected to open low.

Baichuan Co.: expected to rise after opening low.
Jinniu Chemical: expected to open high then fall.
Chitianhua: expected to open high then fall.
Jinzhongda: expected to rise then fall.

5. Summary
Tomorrow, the index is expected to open lower. Stocks with a gap down can be used to trade for intraday sentiment recovery; if the gap is small, even recovery may lack strength. If power grid stocks attempt quick recovery, avoid chasing to prevent quick profit-taking. Chemicals are likely to open high, making trading difficult. Focus on core stocks or those at relatively low levels with good charts. Sector strength opportunities are limited; wait for a big opportunity after the index hits new lows. Currently, stock selection should emphasize sustainability and resilience, betting more on odds. Avoid emotional chasing of small stocks; maintain caution and respect for the market.

This market tests rhythm heavily. Keep positions below six layers; understand before acting. Don’t rush for quick gains and miss opportunities. Wishing everyone big profits tomorrow.

Xiao Shu’s Trading Philosophy:

1. Follow the trend, leverage the trend!
2. Pre-judge and follow decisively!
3. Find the strongest, only do the strongest!
4. Actively admit mistakes, cut losses timely!
5. Reject comparison, aim for stable profits!

Short-term trading is like walking on a tightrope—glamorous on the surface but full of danger. It amplifies market fluctuations and easily traps investors in a cycle of chasing highs and selling lows, blinded by greed and panic. Discipline in short-term trading must be remembered:

• Strict stop-loss: set maximum loss limits for each trade; exit decisively when hit, no luck-based hopes.
• Follow the trend: only trade clear trends; avoid counter-trend operations or guessing market tops or bottoms.
• Control position size: allocate funds reasonably based on market conditions and risk tolerance; avoid heavy or full positions.
• Avoid frequent trading: don’t be tempted by short-term volatility; wait patiently for the best opportunities.
• Stay calm and rational: keep a balanced mindset regardless of profit or loss; execute according to plan.

Remember, short-term market movements are full of uncertainty, but for prepared traders, this is an opportunity, not gambling. Steady operation and flexible adaptation are my keys to short-term success and the solid foundation for future progress.

May your stocks rise like the morning sun, hitting new highs daily; investing be like sailing with the current, steadily earning profits; holdings be potential stocks, value rising step by step; operations be like divine strokes, precise buy and sell. Wishing the market a long rainbow, wealth flowing in, profits continuous, and harvest abundant! If you find this helpful, please support with likes, tips, and comments to help create a positive community atmosphere. The environment of Taoxian is up to us! Likes, tips, and good intentions are not just for pleasing the author—they help us curate quality content, improve the community, and increase the chances of seeing good stocks. We plant, and we harvest!