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The Decisive Battle for 5555 Points Approaches Its Critical Moment

2007/11/7 15:26:47

The title is slightly misleading, because for the bears, this decisive battle is just a minor skirmish—the outcome barely matters. But for the bulls, it's a matter of life and death. From the transitional yin phase that began at 6124 points, whether the bulls make a last desperate struggle or simply give up and accept death for an early reincarnation—very soon, by around Monday at the latest, there will be an answer.

From the bearish standpoint, this ID hopes the bulls can struggle a bit—it would add quite a bit of cruel pleasure. Of course, from a purely technical discussion perspective, the bulls' best move is to advance by retreating—use a bear trap to destroy the aggressively attacking bears.

Since the current bears are rather stupid, this ID might as well offer a reminder: before the slaughter, make sure to display plenty of bullish colors. A bear wearing a bull's disguise is the most lethal. Create a hub of decent size above 5555 points, then stab from behind, knock the bulls down, and kick them off the cliff.

Since the current bulls are also rather stupid, this ID might as well teach the bulls a few moves too. On the monthly chart, there are only two possibilities: either this month confirms a top fractal, or it doesn't. Doesn't confirm means there's an inclusion relationship or a new high is made. The current 5462 points is the key to whether this top fractal gets established, and after a breakdown confirmation, the most critical level is the 5-month moving average, currently near 5300 points. In other words, the bulls can perfectly well set up a large ambush at the 5-month MA, let the bears attack first and produce the fractal, then counterattack to destroy the aggressively attacking bears.

Please recall how this ID perfectly used the top fractal and the 5-month moving average at 3600 points to annihilate the bears. The bulls' most perfect strategy right now is to copy this ID's old script.

However, these stupid bulls probably can't even copy it properly. In the end, they'll probably have to kiss the 5-month MA goodbye in a frenzied night. For the current bulls: if this 5-month MA that hasn't been broken in over two years gets lost on your watch, then stop embarrassing yourselves. The best way to save face is: die early, reincarnate early.

Someone might ask: Are you a bull or a bear? How come you're teaching both sides how to fight?

This ID states very clearly: this ID is the bear that's prepared to kill the bears. A bear that isn't prepared to kill bears is not a good bear. After a top is formed, it becomes a process where bears live facing death. Being bullish at this point means being trampled by bears, yet the bears' ultimate fate is also death. So the only correct approach is to be a bear that's ready to kill the bears at any moment. The reasoning runs deep—once you understand it, you'll gain a much deeper comprehension of the market.

On short-term technicals, a new 1-minute hub has formed near 5555 points. Therefore, this move from 6004 has clearly formed a 1-minute downtrend pattern. Whether the short-term can hold at this level depends on this hub's performance. Understanding this hub's subsequent development means understanding the short-term outcome of this bull-bear tug-of-war.

This ID's view remains very clear: in such a transitional yin phase, anything can happen. Those with good technique can fully exploit this large-scale hub oscillation for the bloodletting game. The more bulls and bears disagree, the greater the oscillation amplitude and opportunities—this is paradise for this ID's theory. As for those without this ability, forget it.

Today's PetroChina, as discussed yesterday: after the line-segment bottom divergence at 38 yuan, it formed a stronger rebound, then created a 1-minute hub around 40 yuan. This is the stock's first 1-minute hub, so it carries the most important guiding significance for subsequent operations. The subsequent movement is one of two scenarios: 1. This 1-minute hub oscillation expands into a larger hub. 2. This 1-minute hub is merely the first hub of a 1-minute decline, which will ultimately break below this hub to form a 1-minute hub downshift completing a 1-minute level decline.

Specific operations should be determined by the actual movement's choice. For example, if you entered a partial position during today's divergence, you can start using subsequent price swings to gradually reduce your cost basis.

The reason for discussing PetroChina daily recently is mainly to use it as a foundation for a textbook demonstration of how a stock's trend is born and evolves from the very beginning. In passing, everyone can see that individual stock analysis is no different from market analysis—it's exactly the same.

This afternoon and evening there are engagements. Tomorrow after the close there's something right away, so the market review will have to wait until the evening. Just noting this in advance.

Signing off, goodbye.