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Market Analysis and Mid-to-Short-Term Outlook

2007/6/29 15:45:10

As mentioned in yesterday's market analysis, if the position indicated by the red arrow in the chart couldn't be broken through, then the market would be in its weakest possible configuration. Today, the intraday rebound was suppressed exactly at that level of 3919 — not one point off — just like the previous 4244, 4131, and others, all extremely precise. Whoever told you this ID's theory has no predictive capability? It's just that prediction is a boring game, not worth wasting time on. The key is always real-time operation.

Today's 1:05 divergence was extremely simple, but since there was no clear 1-minute hub beforehand, such divergences generally only carry intraday significance. As said yesterday, only divergences at the 1-minute level or above have participation significance. Currently, with transaction costs being so expensive and without T+0 trading, those who aren't proficient must only participate in larger-level moves. Smaller ones can probably only be applied to warrants or particularly strong stocks. But skilled traders are the exception. Today, this kind of oscillation could extract quite a bit of blood again.

Since the quarterly candlestick has a 500-point upper shadow, this shadow will suppress price action throughout July to September. This ID's half-line will move up to 4159 next month — before the market firmly stands above that line, no decent rally is possible. It can only be as this ID described in the June 4th article — a major oscillation. Next month's key is the 5-month moving average — if it doesn't break, the market still has a chance to form a triangle consolidation; otherwise, a flat-type correction is unavoidable. This ID clearly stated during the June 5th rebound that this rally could not possibly evolve into a V-shape. Now it appears the strongest possibility is a triangle, followed by a flat-type. The so-called flat-type means retesting the June 5th low.

Of course, the market still has the possibility of forming a triangle. Next week is crucial — the 5-month MA cannot be effectively broken. Good entry opportunities still require divergence at the 1-minute level or above. Rebound resistance: 3919, and more importantly, the 5-week moving average. For those without strong technical skills, with no confidence in oscillating markets, before the 5-week MA is firmly reclaimed, you may opt out of all activity entirely — reading more of this ID's posts would be better. But for the technically skilled, like this ID who often needs some action to feel comfortable, you can extract blood to your heart's content in an oscillating market.

Note: when playing oscillations, you must wait for a sufficiently large buy point suited to your capital size and the specific stock, then absolutely sell at a sufficiently large sell point — otherwise you're just riding the elevator, and that's pointless. This kind of activity requires lots of practice to develop a feel for it. If you feel you don't have the talent for this, then do less of it — spend more time online doing "419" instead.

There are social engagements tonight, signing off first. This week's music session won't be possible either — just replace it with everyone's vigorous feasting activities.

Weekend — feast happily.