This ID Knew the News So Precisely, Yet Still Must Protest!
2006/12/12 9:38:38
This ID knew the news so precisely,
yet still must protest!
Chán Zhōng Shuō Chán
2006-12-11 13:44:29
Protest! Protest! Protest!
To avoid affecting retail investors' operations, what exactly is being protested shall not be disclosed for now — you'll know tomorrow.
2006-12-12 Announcement of major event, trading halted for one hour in the morning
Shuijingfang Major Event Announcement
Sichuan Shuijingfang Co., Ltd. received notification from its largest shareholder, Sichuan Chengdu Quanxing Group Co., Ltd. (hereinafter "Quanxing Group"), that its controlling shareholder Chengdu Yingsheng Investment Holdings Co., Ltd. signed a "Share Transfer Agreement" on December 11, 2006, transferring 43% of its equity in Quanxing Group to Diageo Highland Holdings Limited (hereinafter "Diageo"). The above equity transaction will be implemented upon approval by the government commerce authorities. Quanxing Group will accordingly be converted into a foreign-invested commercial enterprise engaged in business operations, providing procurement services for Diageo and conducting other business activities.
Review of events:
Author: Chán Zhōng Shuō Chán Submitted: 2006-12-6 15:16:00
The strongest protest against Sichuan.
Chán Zhōng Shuō Chán Although this ID's information is extremely accurate, and today one of this ID's liquor company stocks hit the daily limit up even while the broader market plunged sharply, this ID still must protest. The reason this ID bought their stock was precisely to suck their blood — they're selling the factory to foreigners, so this ID is determined to suck their blood. This matter probably can't be changed anymore; accurate sources say trading will be halted in the next few days, probably for about two weeks, and then the foreign devils' arrival will be announced. Infuriating!
There's also one of China's largest pharmaceutical companies currently being acquired by one of the world's largest pharmaceutical companies. The plan is under regulatory approval, and that stock is currently halted. This ID has also accumulated a large position in that stock on the principle of blood-sucking. But this ID only hopes to torpedo this deal! In any case, even if it falls through, this ID won't lose money — the cost basis is very low. I've heard recently that an announcement is coming too. Besides stirring up the pharmaceutical sector a bit, is it really worth letting another major Chinese enterprise fall like this? Of course, this ID will still make money and suck blood, but the outrage must be expressed!
For the protest, I'll reuse the previous article.
Sichuan, Don't Disgrace China!
2006-10-18 16:16:23
This ID once wrote several articles under the title "Acquiring China," laying out the real risk that China faces being acquired. Several years ago, in this ID's famous online essay "Currency War and the RMB Strategy," this situation was already warned about. Later, on the day the RMB was liberalized, this ID wrote "China has finally gone global, but can the world still be Chinese?" Less than two years later, what Chinese enterprises now face is already: "The world remains the world, but can China still be China?"
Having long grown numb to the de-Sinification of Chinese enterprises, in another post I also said — well, foreign money is still money, so from now on we'll just suck foreign blood and see who's more ruthless. But these past few days, regarding the imminent acquisition of a certain famous Sichuan baijiu enterprise by the world's largest liquor conglomerate, I still find it somewhat unacceptable. Baijiu — the quintessence of China. The British, for their "British disease," can make whisky even more GAY, but what gives them the right to whisky-fy baijiu? Who has that authority?
Sichuan, don't disgrace China! The liquor Li Bai once drank, the liquor Du Fu once drank, the liquor Su Dongpo once drank. Without liquor, where would Chinese culture be? Without liquor, how could Li Bai "toast with three companions in his shadow"? How could Du Fu "sing wildly in broad daylight"? How could Su Dongpo "question the blue sky"? Even if all the liquor in China were sold off, how could Sichuan's liquor bear to be sold? A certain liquor brand crowned itself "national liquor" based on some foreign award — but does it have Li Bai, Du Fu, or Su Dongpo? What qualifies it to be the national liquor? If you must sell, sell that one — but don't sell Sichuan's liquor, because that IS Li Bai, Du Fu, and Su Dongpo!
Let whisky be more GAY, let Bordeaux be more SEX, but Sichuan's liquor must remain Chinese, must remain Li Bai, must remain Du Fu, must remain Su Dongpo! In an era without Li Bai, Du Fu, or Su Dongpo, this is probably the most basic, most bottom-line demand of any Chinese person. A person can lack morality, but must have a bottom line. Sichuan, don't disgrace China!
Author: Chán Zhōng Shuō Chán Submitted: 2006-12-7 10:41:00
Serious warning to all retail investors regarding a certain liquor stock!
2006-12-07 10:00:31
This ID's article yesterday "The Strongest Protest Against Sichuan" was purely a protest against the company and had nothing to do with any stock trend. This ID strongly hopes to torpedo this deal because this ID doesn't want to drink Chinese liquor made by the British. This ID's article yesterday was only a warning to certain people — all retail investors should not get involved.
This ID has already made this clear on this blog yesterday, please see:
http://blog.sina.com.cn/m/chzhshch
Some things are not for retail investors to meddle in. I won't write any articles today either — just this statement. Pay attention: retail investors should not mess around recklessly. Risk comes first.
Author: Chán Zhōng Shuō Chán Reply date: 2006-12-12 10:14:39
Author: Lord Naked Reply date: 2006-12-7 18:42:02
This isn't just the fall of enterprises, but the fall of liquor and pharmaceutical culture. Americans can register our ginseng royal jelly, Koreans can register our Niuhuang Wan, and the Japanese can imitate our Liushen Wan to make Kyushin, with annual international sales exceeding 100 million US dollars.
When the day comes that we're drinking Japanese-registered versions of our own national liquor brands in bars, only then will people understand the earnest intentions behind what Math Sister said today.
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Glad you understand.
Replies
缠中说禅 2006/12/12 11:52:05
[Anonymous] aQ
2006-12-12 11:34:40
Started positioning in Moutai JCP yesterday, bought another batch this morning. Now I understand what "one kiss, one lost soul" means! Thanks to Sister Chan for the enlightenment. Today I completed the transformation from novice to skilled player.
Also, may I ask Sister Chan, what was the reason behind the USD strengthening against EUR last weekend? What's the short-term impact going forward?
Finally, a bit of flattery: Sister Chan's interpretation of the Analerta is truly the grand way of righteousness. If you ever decide to establish a school of thought, I'd be willing to join immediately.
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Once you've learned, put it to use. Once you've bought, watch for sell points to appear — especially with warrants. If your capital isn't large, looking at the 1-minute chart, at most the 5-minute chart, is sufficient.
There's no need to explore short-term reasons for currency movements — knowing the major trend is enough.
This ID has no interest in establishing any school. Every person is inherently a Buddha — don't constrain yourself.
缠中说禅 2006/12/12 11:57:06
This matter isn't over yet. There's also this one:
There's also one of China's largest pharmaceutical companies currently being acquired by one of the world's largest pharmaceutical companies, with the plan under regulatory approval.
Let's play a game.
Those interested can guess who it is. The answer will be revealed tomorrow.
缠中说禅 2006/12/12 12:06:44
[Anonymous] Leisurely
2006-12-12 12:05:08
Big sister, don't just tell us about stocks that have almost finished rising.
Haha, how about sharing some insider tips instead!
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This ID doesn't deal in tips — only technicals. Based on technicals, go find first-type buy points yourself.
缠中说禅 2006/12/12 12:08:14
[Anonymous] 炼铁设备
2006-12-12 11:55:18
Blogger: Does the term "divergence" = "deviation"?
600036, its trend seems to show what you described: divergence has occurred.
ICBC has also had divergence.
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Where does ICBC show divergence? Please study it carefully.
缠中说禅 2006/12/12 12:28:10
[Anonymous] 中间体
2006-12-12 12:19:54
Divergence is a very critical technique. Could Sister Chan please explain it thoroughly?
In an upward trend, when the red bars don't make new highs; in a downward trend, when the green bars don't make new lows — aren't there two methods of comparison:
- Comparing with the previous high (or low) point,
- Comparing within the same cluster of red (or green) bars?
Thank you for answering.
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MACD is an auxiliary method. The simplest approach is still to look at the momentum of moving average rises. For MACD, the comparison is definitely cluster-to-cluster. But for the current cluster being formed, when the red or green bars can no longer extend further and start to shorten, that's when serious attention is warranted. You don't have to wait until the red bars turn into green ones, or vice versa — otherwise the reaction would be too slow.
But to fully solve this problem, many other things need to be combined, which will all be discussed later.
缠中说禅 2006/12/12 12:30:21
Old Heretic Chen Studies Zen
2006-12-12 12:23:41
Master, I've left you a message.
If correct, I'll dive in this afternoon.
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Don't buy or sell based on tips — that's a very bad habit.
缠中说禅 2006/12/12 13:00:04
Market's open, heading off for now.
缠中说禅 2006/12/12 15:16:15
[Anonymous] 帅猪如花
2006-12-12 14:49:08
Is the market diverging??????????
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For the broader market, you need to look at Shenzhen — Shanghai isn't accurate. If you look at MACD, Shenzhen didn't show divergence last time. Whether it does this time depends on whether the red bars can continue to extend over the next few days.
缠中说禅 2006/12/12 15:19:29
Xiao Ming
2006-12-12 15:01:51
For 600183's daily K-line, on the unadjusted chart it's still below the annual moving average; but on the standard adjusted chart it's been above the annual moving average for a while. May I ask Sister Chan, which chart should be used as the standard? Also, why is there such a big difference between them? What's the mystery?
Last time you mentioned that the Shanghai Composite has produced 2 gaps, and if a third appears it would be an exhaustion gap. But so far it hasn't appeared. Does the gap in the Shenzhen Composite at 5666-5692 count as Shanghai's exhaustion gap? Does this mean the market has already entered a period of adjustment and oscillation, ending the one-sided uptrend?
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Use unadjusted. Gaps are just for reference.
缠中说禅 2006/12/12 15:34:24
[Anonymous] 雨中荷
2006-12-12 15:20:55
Hello blogger!
Today both Shanghai and Shenzhen markets have set new recent highs but MACD hasn't set new highs. Does this already constitute divergence? Thank you!!!
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That's not how you look at it. Today's red bars are longer than yesterday's — that's sufficient, because this cluster is still forming. Only when the red bars shorten one day, and the final position doesn't exceed the previous one, is that a danger signal.
缠中说禅 2006/12/12 15:48:59
Heart Zen
2006-12-12 15:33:41
"Master," today I spent the whole day intensely watching the Shenzhen market's 1-minute chart as you mentioned, studying your MACD red and green bars. I kept feeling Shenzhen's momentum was insufficient. In the morning I sold 600111 at 10.10 to go to cash, planning to buy Beichen, but the first buy point you described seems to have not yet appeared. Waiting for tomorrow's market to become clearer. Thank you so much!
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If you're doing ultra-short-term trading with daily entries and exits, once you sell you must immediately find the right target to buy — that's how you maximize capital efficiency. Otherwise with T+1, it's very hard to operate. If you're doing medium-term, in a bull market don't casually go to cash. Unless your capital is particularly small, you can use oscillations to continuously lower your cost basis, and then sell everything at once when the first-type sell point appears on the daily or weekly chart.
缠中说禅 2006/12/12 15:54:35
[Anonymous] 见习者
2006-12-12 15:35:01
My guess is Sanjiu Group.
Is divergence when price rises but volume declines, or when price falls but volume rises?
Looking forward to the answer.
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Volume is just for reference. The key is to look at the momentum of the trend.
缠中说禅 2006/12/12 15:54:55
Something came up, heading off. See you.
缠中说禅 2006/12/12 19:29:44
[Anonymous] 然然
2006-12-12 15:59:10
Dear sister, please answer me! I put all my house-buying money into 000768!
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First of all, the market is not a casino. Putting your house-buying money into the market is a mistake to begin with. Money in the market must be idle money — money you can leave untouched, with no pressure to withdraw. Only then can you operate with a calm mindset.
Second, this ID doesn't know at what price you bought in, nor do I know what trading style you've chosen. If you bought at the bottom for short-term trading, you should have left long ago — at least you could have avoided such a long period of consolidation. For small capital, the most important thing is not to participate in extended consolidation — that wastes too many opportunities. If you chased a high entry, then nobody can help you. Because this stock is in a medium-term correction after a major rally, and it has long been dominated by a market maker, so you can only hope that market maker goes easy on the shakeout. Technically, the triangle consolidation is nearing its end, but for this type of pattern, if this ID were the market maker, I'd definitely slam it down hard once to shake everyone out, then reverse upward. Your only hope right now is that you don't encounter a market maker who thinks like this ID — otherwise I'm afraid you won't be able to hang on. Medium-term, this stock does have the potential for another wave up, but the key is whether you can endure.
Finally, a piece of advice: stocks are meant to be a joyful game — don't make yourself so miserable. Insisting on entering only at first-type or second-type buy points is a good way to stay happy.
What is a true master? It's like the butcher Pao Ding dissecting an ox — choosing the path of least resistance. Those who love playing on the highest difficulty every day will never become true masters.
缠中说禅 2006/12/12 19:31:21
[Anonymous] 获益匪浅
2006-12-12 17:02:44
"Every upward reversal is formed by a first-type sell point of some level; every downward reversal is formed by a first-type buy point of some level." Could the blogger please elaborate on this when you have time? Much anticipated.
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Of course, but this needs to be arranged for the lesson after next, because the next lesson will cover a highly efficient buy-sell method suitable for small and medium capital.
缠中说禅 2006/12/12 19:53:57
[Anonymous] 炼铁设备
2006-12-12 16:49:26
Based on the 5-minute chart, I judge as follows:
Beichen Real Estate (601588) will rise tomorrow
Shanghai International Port Group will rise tomorrow
ICBC may fall tomorrow
China Merchants Bank, Bank of China will fall tomorrow
Please critique, blogger!
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You've completely misunderstood. This isn't about teaching fortune-telling. Predicting rises and falls is what stock commentators do — this has nothing to do with this ID.
缠中说禅 2006/12/12 19:59:07
[Anonymous] 舞者
2006-12-12 16:48:09
2006-12-12 15:20:55
Hello blogger!
Today both Shanghai and Shenzhen markets have set new recent highs but MACD hasn't set new highs. Does this already constitute divergence? Thank you!!!
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That's not how you look at it. Today's red bars are longer than yesterday's — that's sufficient, because this cluster is still forming. Only when the red bars shorten one day, and the final position doesn't exceed the previous one, is that a danger signal.
－－－－－－－－
"And the final position doesn't exceed the previous one, that's the danger signal." May I ask, does "the previous final position" refer to the red bars from the previous day, or the longest red bar from the previous wave? Please clarify.
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This question is very simple. If you use MACD red and green bars to identify divergence, of course you look wave by wave. How is a wave of red/green bars formed: they first extend, then shorten, and the longest position is the turning point. If today's is still longer than yesterday's, it means the turning point hasn't appeared yet. Only when today's is shorter than yesterday's, and yesterday's is longer than the day before — that's when a turning point emerges. One look at the chart makes it clear. This is too basic a question.
缠中说禅 2006/12/12 20:11:39
[Anonymous] 雨中荷
2006-12-12 16:03:42
Thank you, blogger. I understand now — so if the stock price or index makes a new high while the MACD red bars are lower than the previous day, that could indicate divergence, right? Also, if divergence occurs and the stock price drops until the 5-day and 10-day MAs kiss, will there still be a rally to a relative high point for exiting, or will it just keep falling? Thank you!!!!
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Incorrect understanding. When the bars show today shorter than yesterday, and yesterday longer than the day before, it proves that a wave of bars has turned. If the height on the turning day is lower than the previous wave's turning height, that forms divergence in the bars.
But for MACD, looking at bar divergence alone isn't enough — you also need to watch the trends of the yellow line DEA and white line DIFF, especially for channel-type patterns.
This issue will be discussed later when we cover technical indicators.
缠中说禅 2006/12/12 20:16:23
[Anonymous] 可惜
2006-12-12 20:09:59
For the blogger, this was a lost business deal. No need to protest anymore — do you really care about that little bit of money?
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For those unfamiliar with the market, please refrain from discussing market matters. This ID has been sucking blood back and forth — it's nobody else's business. This topic ends here. Anyone trying to probe this ID's position — not a chance!
缠中说禅 2006/12/12 20:33:13
[Anonymous] 我已潜水好久
2006-12-12 20:30:02
"This ID," you really give me a headache. I'm guessing not everyone here trades stocks professionally, so most people don't have time for short-term trading. Your theory only presents the core concept, but the stock market is ever-changing — how could such a simple core concept be enough for prediction? It requires many indicators supporting each other.
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Your understanding is also wrong. First, this ID opposes any form of prediction. Second, the effectiveness problem of any system was discussed multiple times before, especially in the chapter on mathematical principles. First understand what this ID has said, otherwise anything else is meaningless.
缠中说禅 2006/12/12 20:38:09
[Anonymous] 一样一样
2006-12-12 20:15:03
May I ask, is 600900 about to experience divergence????? Thank you!!!!!!!!!!
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On the 30-minute chart, divergence already occurred long ago — that's why there have been so many days of correction. But on the daily chart, it doesn't exist. Because generally the most effective divergence occurs like this: the yellow and white lines return to near the 0 axis and go up again, stock price makes a new high while both lines and the bars don't make new highs — that's when the most effective divergence occurs.
缠中说禅 2006/12/12 20:39:37
[Anonymous] 路过
2006-12-12 20:32:57
Sister Chan, since you're here, let me ask — have you studied the I Ching?
If so, to what extent?
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I'll discuss it after finishing the Analerta — probably a year from now.
缠中说禅 2006/12/12 20:43:30
[Anonymous] 一样一样
2006-12-12 20:33:03
Another question — when a good stock is truly rallying, isn't that precisely divergence upon divergence upon divergence?
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Wrong. After true divergence occurs, a reversal follows. Go study Beichen's 30-minute chart.
The key issue is: don't mistake non-divergence for divergence. There are many techniques involved, all of which will be covered later.
缠中说禅 2006/12/12 20:45:00
[Anonymous] 上海三毛
2006-12-12 20:43:14
Thank you so much, blogger. I've learned a lot. I believe by studying with you, I can definitely recover the losses from previous years. Thank you!
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This ID is not a crutch — you must make it your own. Look at more charts, study more, understand more. There are no shortcuts here.
缠中说禅 2006/12/12 20:52:35
[Anonymous] 摄影之友
2006-12-12 20:41:23
Chán Zhōng Shuō Chán 2006-12-12 15:48
If you're doing ultra-short-term trading with daily entries and exits, once you sell you must immediately find the right target to buy — that's how you maximize capital efficiency. Otherwise with T+1, it's very hard to operate. If you're doing medium-term, in a bull market don't casually go to cash. Unless your capital is particularly small, you can use oscillations to continuously lower your cost basis, and then sell everything at once when the first-type sell point appears on the daily or weekly chart.
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
Blogger:
On 12.11 I bought 000932 Valin Steel Tube at 3.92 using the 15-minute K-line. I initially wanted to monitor the sell point using the 5-minute chart, but based on what you said above, do I need to switch to using the daily chart to find sell points?
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Don't think that way at all. The premise of what this ID said was that you entered at a first-type or second-type buy point on the daily or weekly chart. Your current buy point doesn't meet this requirement at all, so you can't operate this way. First of all, no standard first-type buy point actually appeared on the 15-minute chart. This purchase is actually a box-pattern operation, unrelated to first-type buy points. For short-term, operate according to the box pattern — exit when the box top isn't broken, buy back if it returns. Of course, if you're lucky and it breaks through the box top this time, even better. But operationally, you can't have that expectation.
缠中说禅 2006/12/12 20:55:52
[Anonymous] 学生
2006-12-12 20:45:40
"If you're not good at live tracking, the simplest method is to watch all new stocks that break above their IPO-day highs on heavy volume, and old stocks that break above the annual moving average on heavy volume and then pull back to it on light volume — these are all future dark horses." But 002087 met the first condition on December 6th, so why has its trend been so weak these past few days? Please comment, Sister Chan.
In the lesson "No Trend, No Divergence," I'm completely confused about divergence. Could you explain with an example, like drinking Moutai? Thank you.
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Just study the Moutai example carefully. Find one good example and slowly figure it out. Once you truly understand it, then look at other examples. If you can't quite grasp divergence through moving averages, start with MACD — that's easier to grasp. They're all methods; the key is to master one thoroughly. Don't try to learn too many at once. In actual operation, mastering one method is more than enough. The worst is knowing a little about everything but mastering nothing.
缠中说禅 2006/12/12 20:58:01
[Anonymous] 一样一样
2006-12-12 20:55:02
Thank you for the guidance. So for divergence, do you look at the 30-minute chart for short-term and the daily or weekly chart for long-term? Which is more effective?
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Your thinking still hasn't shifted. It's not about being told which chart to look at — rather, you first choose which chart to use based on your own situation. As for how to use lower-level charts to scalp price differences after entering, that's a separate issue — it's about how to improve capital efficiency.
缠中说禅 2006/12/12 21:02:31
[Anonymous] caiyd
Thank you for your analysis. No wonder I couldn't find anything analyzing the recent six months. Everything you described was the big picture of 2005, and the best sell point was on 2006-7-28. It seems I can only hold this stock and wait to break even.
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It's fine. In a big bull market, ultimately almost all stocks will have decent gains. Spend the time learning more — after all, the market isn't a one or two year affair.
缠中说禅 2006/12/12 21:05:13
wy1499
2006-12-12 20:46:32
Blogger, yesterday I left a comment on your "Currency War and RMB Strategy — Continuation I" with a few questions. Could you please give some guidance? Thank you!
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If you have questions, repost them here. Too many threads — this ID can't keep up.
缠中说禅 2006/12/12 21:14:35
Attention everyone
Identifying divergence is one of the biggest challenges in actual operations. It's difficult to grasp all at once, so be patient.
To judge divergence, you can look solely at moving average relationships — this requires relatively high skill.
You can also look at technical indicators such as MACD — that's easier to grasp.
For MACD, the key is handling the relationship between each wave of red and green bars, and the turning point highs within each wave. Each wave of red/green bars is like a small mountain, and the peak is the turning point — one look at a chart makes this obvious.
But just knowing how to read the red/green bars is only elementary. The key is learning to read the two yellow and white lines above. When the yellow and white lines are above the 0 axis (the line separating the red and green bars), it's a bullish market; below, it's a bearish market.
Here's a MACD theorem from Chán Zhōng Shuō Chán: First-type buy points are all formed by divergence below the 0 axis; second-type buy points are all formed by the first pullback confirmation after crossing above the 0 axis. For sell points, it's the reverse.
More detailed explanations of this theorem and other issues will come when we specifically cover MACD later. For now, you can start with this.
缠中说禅 2006/12/12 21:19:21
Heart Zen
2006-12-12 21:10:09
This is the place I think of visiting every day. Delighted to see "Master" is here! You work so hard, answering our questions both at noon and evening. I saw you mention there will be an article on "high-efficiency buy-sell methods for small and medium capital" tomorrow. So looking forward to it! I believe "Master" must be a benevolent Buddhist, being with us all! I won't ask about technicals today. I know you're in Beijing, and I'm in Shenzhen. I sincerely hope to one day have the honor of hosting you!
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No plans. I just happen to have no social engagements tonight. Beijing is freezing cold outside right now — might as well answer some questions here. At least it can help everyone. That article will come out the day after tomorrow. With so much content above, I need to give everyone some time to digest it. Otherwise dumping new material right away will mix everything up, and that would be troublesome.
Please read that "Attention everyone" above carefully and study the charts to understand it yourself.
缠中说禅 2006/12/12 21:29:01
Here's a chart for everyone. Combined with my "Attention everyone" above, analyze it yourself. This is 038004, the Wuliangye put warrant. This ID played it once when it first listed, and this recent time is the second time — entered exactly according to this standard. Guess where this ID entered and at what point additional buys were made. The answer will be given tomorrow.
This warrant carries extreme risk and will ultimately become worthless paper. This ID is only discussing it for educational purposes — absolutely do not buy it. Moreover, the buy point has long since passed, so you definitely cannot buy it now.
缠中说禅 2006/12/12 21:30:16
Alright, that's it for today. Heading off. See you.
缠中说禅 2006/12/12 11:45:57
[Anonymous] Leisurely
2006-12-12 11:27:47
Big sister, you're not massively dumping shares, are you? Those four-digit lots are all from you, right? Haha
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Do you really think this type of question will get an answer? Don't ask questions that have no answers.