Let Me Tell You the Index Script
2008/1/10 15:19:00
The script was written long ago. Originally, being so close to the situation, I didn't want to gossip. But this ID just wants to prove one thing: in the capital market, even if you hand someone the script, the vast majority will still end up in the well. The slightly better ones will just ride the elevator up and down, selling advertising for it. Don't believe me? Just watch.
Let me tell you a general principle: in a bull market, the Shenzhen Component Index is the vanguard. This has been the case for over a decade—never changed. Why? The reason is embarrassingly simple: Shenzhen has been watching component stocks early in the morning forever. Manipulating several dozen stocks is always easier than handling 1,500+, right? Ever since the '96 episode when they sent component stocks like Qiong Minyuan into a feather-storm mess, this characteristic stuck. There are also historical and structural reasons related to capital flows, but I won't bother gossipping about the specifics. In short, this is a general principle.
So for any ambitious script about an upward move, the first principle is: first carve out a patch of blue sky for the Shenzhen Component Index. If even the Shenzhen Composite can't find blue sky, other indices should just hang out on the sideline.
Carving out blue sky requires testing which way the wind blows.
As for the Shanghai index, it's usually very technical. Everyone knows what 1/8 of 3600 is, right? This time, the drop from 6124 was exactly 3/8 of 3600, which is 1350 points. The precise level is 4774—and the actual low was 4778, off by 4 points. Pathetically imprecise.
The 2/8 level from 6124 is 5224. The first bounce peaked at 5209—that's almost 15 points off. Way too much. Outrageous.
The 1/8 level is 5674. That's the next target. But since the halfway point of the entire decline is 5451, and the neckline of that M-top is at 5462, this level is a position that must be fought over in any script. Also note: the 2/3 retracement level of the decline is 5675 —doesn't that look similar to 5674?
The script is very unhappy with the gap between 5860 and 5912, and has already prepared plenty of glue. But there's still a shortage. When the rest of the glue is gathered depends on the policy wind direction during the 5462-to-5675 stage. If the wind is wrong, then the money for glue gets exchanged for lollipops—one lollipop per person. Your choice: the stick or the candy.
If the wind doesn't change, then start reselling counterfeit glue—one cup per person. Stick a bird on it and fly toward the sky. Flying and flying, suddenly it falls apart. End of this chapter of the script.
As for the next chapter, I'll tell you when I'm in the mood.
Today the market continued wrestling with 5462. Seeing more and more people embrace this ID's philosophy of "the sooner the struggle, the sooner the bread," this ID is quite pleased.
Signing off, goodbye.