Finally Emphasizing Macro-Control Again — Great Hope for China

2007/10/25 15:43:22

Tell me, is tonight's moon full?

The biggest news today concerns the emphasis on macro-control — this is exactly what this ID most wanted to see. This ID already stressed this point in "China's Economy Already Needs Rectification and Reorganization 2007-10-15 08:32:52," and it's gratifying to see a response today.

The economic big picture ultimately determines the market's big picture. Today's news is a good reminder for everyone with any hope in their hearts.

Technically, yesterday the possible scenarios were analyzed with the utmost rigor — it all came down to the third buy/sell point situation of that 1-minute hub. This morning, after the gap-down opening due to the news, the first hour's throwback precisely formed a third sell point — this is, within the framework of this ID's theory, the last escape line for the short term.

However, it must be noted that this second bottom-testing process does not mean the top has been fully established. Once the massive capital unfreezing occurs and the weekend news becomes clear, a rebound with some momentum can be expected.

Note: this rebound, in the worst-case scenario, is just a throwback after breaking below the neckline to confirm it. Currently the neckline is around 5555 points. In this worst-case trend, the market first drops to somewhere like 5300 or even 5000, then a throwback that fails to reach 5555, then the top is confirmed, then a major continued decline — the ultimate correction target would be 4000 points or even lower.

Of course, the best-case trend would be a false break below the neckline followed by a throwback above it, in which case there could even be another run at 6000 points. Of course, this is the best-case scenario — whether it materializes depends on what the bulls agree to, what the bears may not agree to, and even if the bears agree, the policy side may not necessarily agree either.

This ID has already said: trading rebounds carries enormous risk. If you can't even distinguish a third buy/sell point, then keep sitting on your little stool. These rebound trades — you're not qualified to participate.

Although this ID's side has already achieved total victory, just as after the great victory at 3600 points, this ID wants to explain the subsequent situation. This decline has accumulated potential for the low-priced stocks ahead. At year-end and next year, there will be quite a few good stocks at good prices again — that is the greatest utility of this round of market movement.

Rhythm — there's the big rhythm and the small rhythm. Of course, you must first have big thinking and big rhythm. The intricacies here, slowly savor them for yourself.

Signing off first, see you later.