[Red Envelope] Accurate prediction of fiber optic modules, rational analysis of indices, and confident facing of the market!

Accurate Prediction of Optical Fiber Modules, Rational Analysis of Indicators, Confidently Facing the Market! Short-term trading is an art. It uses the ever-changing market as a canvas, with keen insight as the brush, and decisive execution as the pigment. True masterpieces are not born from chasing random fluctuations, but from precisely capturing and resonating with the market’s core “strength”—drawing directions at emotional peaks, structuring during sector rotations, and ultimately adding the finishing touch at the moment individual stocks lead the rally. ————Art of Compound Interest[Taogu Ba]

Artist’s Meal Hall Review:

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Yesterday, during trading, some friends asked if they could directly chase optical fiber modules, and today others asked the same. I provided clear advice: do not chase for now, see it as a rebound, observe more. In yesterday’s review, I also clearly said not to chase high tomorrow; it’s not very meaningful. Looking at today’s trend, does it seem like a sign of a pullback? If you chase at the open today, you’ll likely end up with a loss. When the market isn’t very clear, you must control your hands and avoid chasing highs casually—there’s risk. Review posts are not written casually; they contain useful information. Study more to help you avoid many risks.

Today, chemical fiber stocks showed intraday volatility. Before the market opened, some friends asked about it, and I advised to watch sectors opposite to oil trends. Chemical fibers are clearly opposite to oil, including phosphorus chemicals, which have recently moved against oil. You can overlay sector trends to see this. In a rotating market, it’s important to be good at finding opportunities and willing to gamble. Last night, I also mentioned chemicals in private chats, so I won’t detail here. This trend will rekindle a logic we previously discussed—can you guess what it is? Think about it.

Yesterday, the Shanghai Composite closed at 4123.14; today it closed at 4139.52, breaking through the high of 4129 from the 6th and successfully crossing the 10-day moving average. All short-term moving averages have been regained. Previously, we said the index was below short-term averages, facing pressure. Now that it’s stabilized, we can be somewhat optimistic. But we must remember, although the index has risen, volume is insufficient despite some increase. Without enough volume, a rise is likely to pull back, which everyone understands. So, while there’s a breakout, its validity is uncertain. The worst-case scenario is a pullback, which isn’t too worrying.

Market Analysis Today:

From the index perspective, Japan and South Korea markets continue to recover, and the US stock market shows no major fluctuations. Today’s index opened flat and oscillated slightly higher throughout the day, as expected. Recently, the ChiNext has been outperforming the Shanghai and Shenzhen indices, a subtle but important difference. In different phases, the stronger market should be the focus for participation.

In terms of volume, the two markets traded about 250 billion yuan, a 4.61% increase from yesterday’s 110.5 billion. Although volume increased, it’s still not enough; a clear surge is needed later.

Market sentiment shows 53 stocks hit daily limits, 2 hit limits down, 1926 stocks rose, and 3126 fell. The average gain of limit-up stocks today was 2.55%, lower than yesterday. Overall, the market’s profit-making effect is weaker, and sentiment is moderate.

Sector-wise, the market remains in rapid rotation with no particularly standout sectors, except chemicals showing relative strength with multiple stocks hitting daily limits. Energy storage, photovoltaics, and batteries are active and performing well. Non-ferrous metals and oil sectors are also warming up. Power and computing sectors show clear divergence; tech sectors that led yesterday are now retreating. Overall, short-term sentiment is somewhat strong in certain areas.

Artist’s Sector Commentary:

1. Oil/Shipping/Natural Gas
Yesterday, oil sector stocks followed external futures sharply down, then rebounded. Today, futures stabilized, and oil stocks also rose. The same advice applies: the risk-reward and safety are not high, mainly for reference. When oil warms up, other sectors tend not to strengthen. Watching oil is important because it can help predict other sectors’ price increases, like chemical fibers. I discussed this with friends last night; the logic behind the price rise is complex, but you can start by reviewing previous price increase logic lines.

2. Power
Power sector showed divergence today. Shuneng shares opened high but quickly declined, staying below the moving averages all day. Yunnan Energy also maintained a decent oscillation without major negative feedback. Intraday, signs of capital inflow into power stocks appeared multiple times. The sector’s resilience is decent, but high-priced stocks lack firm signals. As long as Yunnan Energy continues to oscillate well at high levels, funds can do some low-level catch-up. Keep an eye on Yunnan Energy and Shuneng as core stocks for potential rebound opportunities.

3. Computing Power
The logic for computing power remains unchanged. Market rotation is fast, and signs of sector rotation are evident. Lobster concept stocks performed weakly today, but this doesn’t affect the long-term trend. The shortage of computing power is undeniable. Whether it’s the lobster concept or crab concept in the future, they all trace back to fundamental computing power. Be patient and focus on high and low trading of core stocks. There have been many opportunities to buy low and sell high in this sector. Chasing highs is not advisable. Some stocks, like Huasheng Tiancai, show trend-like momentum, with quant funds involved. We can replicate this approach with other stocks like Tuowei. Currently, there’s no dominant core leader; stocks are running in parallel, like Litong Electronics today. The overall movement is choppy, not very smooth, but it doesn’t affect the long-term trend. Ningbo Construction, the top stock, successfully turned over today with high turnover, but the volume was large. Tomorrow, watch the opening auction to see if it opens strongly red, indicating strength. If Ningbo Construction weakens but then turns strong, consider recent stocks that hit the limit down.

4. Optical Modules and Fibers
Yesterday, optical module and fiber sectors rebounded strongly, lifting the index. Today, these sectors experienced some pullback. Longfei Fiber, which led the surge, initially rose but then failed to hold, and other stocks within the sector didn’t follow through. This indicates overall weakness in optical fiber today. Longfei’s rally isn’t very reliable; such stocks are mainly held by institutional main positions. To avoid being caught off guard, it’s better to hold them tightly. In optical modules, Huagong Tech continues its strong trend. Yizhongtian surged yesterday but pulled back at the open today, showing weakness. Currently, two strong stocks are Huagong Tech and Hui Lv Ecological. These reflect the market’s preference for trend-following stocks that keep rising. Previously, Tianfu Communication was also strong. When short-term momentum isn’t good, shift focus to these types of stocks.

Although the index rebounded slightly today, it’s not yet in an accelerating upward phase. For optical modules and fibers, view the short-term as a rebound. Watch for potential pullbacks; if it stabilizes after a dip and then continues upward, it indicates a reversal, increasing safety. This is a good point for some contrarian plays.

Every morning, I share news and core stock picks. Follow the artist, stay on track, and avoid getting lost. The morning content mainly covers sectors I anticipate based on market analysis! Please like the posts, tip, or support with points!

Having heard too many grand theories and market principles, many still don’t know how to implement them. That’s why I share my “Strength Pyramid System,” which can bring growth and value to you—take it seriously. Those who always want free benefits at zero cost will only stay on the surface of trading and never grasp the core profit logic. The purpose of sharing is to help those who follow this post not to be confused. But the market will evolve, and so will our “Strength Pyramid” system. In the future, as market conditions change, I will add new “dimensions” to it to better adapt to different market cycles.