[Red Envelope] Getting to the core! Two insights to help you "walk sideways" in the market

Today’s main post directly hits the core, sharing with students the most essential profit-making styles during this period. If you like it, remember to like, follow, and explore more. [Taogu Bar]

With sincerity and focus, let’s begin the main content.

Point 1: How to determine style switching and follow immediately when funds are active:
This week’s biggest challenge in trading is the “market segmentation,” which causes many students, even seasoned traders, to struggle with pinpointing entry and exit points. It’s like asking: Is Tuesday, the first day after the new year, an entry opportunity?!

Many students or teachers might say, “The top board,掌阅科技, instantly hits the limit down; robot applications all fall short of expectations and plunge + hit the limit down,” “It’s not an opportunity after work!”

But in our model, we see this as a good risk-reward arbitrage opportunity

Because we know emotions and trends are like a seesaw effect. The slow bull market features emotions moving in trends, otherwise, if both sides move together, it’s a crazy bull. So even if emotions falter on Tuesday, we can’t simply dismiss the market as trash; there are always opportunities. Conversely, whether it’s PCB, precious metals, oil prices, power, tech trends, or commercial aerospace, there are excellent opportunities with at least 2-3 days of performance in four days. Here, we should look for anchors. How can I tell if emotions are weak but trends are strong?

The key is to determine whether the outside buying willingness is positive or not.
On Monday, a clear sign is the market’s long-lost increase in volume, indicating outside buyers are willing to enter. Even if robot applications plunge, the market still has 4000 stocks rising and some local sectors showing good profit effects. Since outside buying is willing, but the hot emotions during the holiday—like applications and robots—are strong, are they still strong?

Then, funds never sleep and will aggressively push other resonant markets, such as the trend of emotions in the seesaw.
If we further segment, the main trend is driven by price increases, subdivided into precious metals, oil, PCB. Our choice within the model is “PCB price increase route.”

Why? Because considering potential outside buyers, if you think from their perspective, futures in precious metals and oil have been heavily shorted recently. The recent wave of limit-downs in gold, silver, and oil is fresh in memory. What if Trump has a drink and a handshake, and T+0 futures plunge? What about T+1 in A-shares? They can only be trampled inside the market. Moreover, trading futures in major A-shares is a leading behavior for re-rallying, so why not do futures in A-shares instead of traditional futures?

This thinking leads us to more logical price increase stories, like PCB—company earnings improve, supporting stock prices. This makes sense, right? At least, everyone is willing to buy into the price increase trend. So when I see that application robots underperform expectations, but PCB, precious metals, and other price increase lines meet expectations, I immediately focus on PCB price increase. Various correction signals or new highs in copper foil bidding, Shandong fiberglass’s high stance—all are positive signals.

Therefore, the only arbitrage choice in our model’s bidding is “International Composite Materials,” which we follow directly at the open, resonating with market thinking.

Did you learn the first key point?

Point 2: The chaotic oscillation structure remains unchanged, and rotation styles are the main profit effects.
If you’ve studied the soil pile method, you know since February, my stock selection style has two core principles: 1. Only trade at the market’s bottom of the box, only strike during market lows;

Does this rhythm make the recent index structure clear and easy to understand?

In February, my first strike was on 2.3, when the index hit 4002 in the box bottom, resonating with opportunities in commercial aerospace/tech arbitrage. On Monday, I focused on Saiwei Electronics; by Wednesday, I took it off.

My second strike in February was on 2.6, at 4029, again at the box bottom, with AI application arbitrage. I focused on Wangsu Technology on Monday, took it off on Tuesday after a high, then again on Wednesday, and again on Thursday.

The third strike this week was on Tuesday, when the index adjusted to around 4079 at the ice point, resonating with price increase arbitrage. On Monday, I focused on International Composite Materials; on Tuesday, I took it off; on Wednesday, I paid attention to Aerospace Development; Thursday, I took it off.

Just right, these correspond to three market lows or short-term bottoms, so I don’t need to guess what theme will run tomorrow. I only judge the market bottom and see what themes resonate, then follow. The themes resonating at the bottom are the most sustainable and profitable over a period.

2. Only trade themes that produce profit effects, focusing on explosive themes;
Since the recent wave of limit-downs in commercial aerospace in January, the market has not seen a continuous three-day strong trend in any theme. Most themes rise sharply one day, fall the next, with at most two days of gains before a decline. We just need to objectively follow the market structure. Since the market loves rotation, don’t chase themes that hit new highs continuously. Patience with hot theme rotation is key. If you miss the peak, the downside is limited, but gains can be substantial. For example, the PCB price increase theme I focused on Tuesday previously showed profit effects, with five-day adjustments, and a pre-holiday correction with expectations. After the holiday, the bidding signals were clear, and I followed immediately. Whether it’s Honghe Technology or International Composite Materials, Copper Crown Copper Foil, or Shandong Fiberglass, Tuesday and Wednesday provided comfortable entry points and results.

Including why we choose Aerospace Development on Wednesday and Huasheng Tiancheng on Thursday—it’s the same logic.
Both are themes that previously surged or had continuous news fermentation. When they undergo short-term correction to a risk-reward ratio that suggests rotation, opportunities arise. For example, commercial aerospace on Wednesday is a repeated bottom-fishing opportunity during the holiday, based on expectation differences. The profit effect from earlier is hard to falsify; when it hits support, it’s a rotation opportunity!

Similarly, Huasheng Tiancheng on Wednesday night was also a backup. It previously showed profit effects in AI applications, but the mid-term logic remains intact, avoiding continuous limit-downs. It involves correction and rotation expectations. Since the market style can’t fully realize pure application themes, adding other attributes increases rotation probability. Now, you should understand that my pre-holiday focus is on “computing power + application like Wangsu Technology,” and the backup on Wednesday night is “domestic computing power + application Huasheng Tiancheng.”

Once you clearly grasp the market’s pulse, you won’t be led by the market but will continue your rhythm, trading within your familiar model, making trades that let you sleep peacefully. Every decision becomes an art piece.

But you must know, most traders can’t control their hands or understand opportunities not because of lack of self-control or IQ, but due to insufficient cognition and understanding. They can’t react instantly to signals in the market. That’s why some signals are opportunities to exit, others are risks to be in cash. Only after countless frustrations can this change. Someone says, “Will you teach the dry goods of eating without reservation?!” Honestly, such comments today reflect a lack of understanding. Many predecessors have shared their insights freely, but you must know that knowing the theory is only the first challenge. Otherwise, why are there so many mouthpieces talking about stocks?

Therefore, systematic “preaching” of opportunities is rare. I can’t always protect every student. Limited time and energy mean I will share some core, practical, and genuine trading principles openly during trading. “The Dao is not lightly transmitted; the law is not cheaply sold”—I want to focus on cultivating a group of truly capable, independent traders.

Remember this: “Trust early, wisdom may not be innate, but following is crucial.” This isn’t impulsiveness but respect for opportunities and reverence for the model.

This kind of heartfelt analysis for students is unique; you won’t find it elsewhere. If you feel our sincerity, just give a like, follow, and share. That’s my peace of mind.

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(Only seven “Cheering Vouchers” needed to become a featured article. Personal opinions are for reference and discussion only. Mentioned stocks are not guidance for you. Do not operate blindly! The stock market involves risks; trade cautiously. This is not investment advice. Reproduction must credit “Xiao TuDui Bao Jin”.)