【Red Packet】3.20 Closing Review - Stock Index Delivery Kill

This morning, funds recovered a wave, lasting until around 9:50, then dropped sharply, and recovered again by 11:30, ending the session. The rest of the time was mainly fund cashing out. Yesterday, I said the index rally was ineffective, and today it proved true. Currently, the index has broken support, closing at 3955.71. Today’s stock index settlement had a significant impact, so some sell-offs were passive, giving a feeling of over-selling. Next week, the index is likely to have a rebound; note that this is just a rebound, not a reversal, probably between 3955 and 4000 points. [Taogu Ba]

After discussing the index, let’s talk about the sectors. Currently, from the sector perspective, defensive cyclical stocks are starting to clear out, which is a good sign, indicating that the downside space for the index isn’t very large. The maximum decline is likely around 3860, at most 100 points. Defensive cyclical sectors mainly include non-ferrous metals, oil, and chemical industries, which are driven by sentiment premiums caused by war. In the short term, most of these have been cleared out.

The hype around the power sector is also entering the mid-to-late stage, leaning towards the later phase. Central military construction and power construction stocks are mostly done, as late-stage stocks tend to lack central military stocks. What remains are some sentiment-driven, group-collective stocks, which will end once the sentiment-driven rally drops again. Key stocks to watch are Hang Electric and Henan Energy. Besides these two, Yu Energy, Geke, and Jinkai are also favorites for group-collective trading. Apart from these four, other stocks are generally considered back-row arbitrage, characterized by quick gains and quick exits. I suggest starting next week, avoid focusing on back-row stocks, or risk repeating the mistakes of the late stage of commercial aerospace.

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Next week’s highlights:

Lianban ladder: 5-board, 3-board, 2-board, 4-board gaps

From the ladder perspective, currently, power stocks dominate the continuous board trend. But there’s a problem: if power stocks really break through 4 boards, that’s unreasonable. Stocks below 4 boards are considered back-row supplements and not representative. Focus on whether Huadian can break through the three-resistance level and reach 6 boards; buy points should be delayed, preferably deep water entries, to maximize value. Also, pay attention to Huashifa and Dashengda, which are alternative stocks—what supports them to keep rising? If they break through 5 boards, that’s also worth noting.

From the perspective of the first board, power stocks still need observation. Besides the power sector, energy storage can be seen as a divergence of power, and photovoltaic stocks are led by Laoma. Other stocks like Huashu and Jingtou also need close watching.

The “Sentiment Cycle Theory and Node Switching,” “Stock Market Mysticism Theory,” and “Stock Market Relay Stick Theory” are insights accumulated over several years by the author. Whether to hold classes on weekends depends on the number of tips, likes, and comments received.

Disclaimer: The above opinions are only for review and record purposes. Operate at your own risk. ❗