Routine Consolidation After the First Target Was Reached

2007/12/12 15:33:01

After reaching the first rebound target yesterday, today's routine consolidation was perfectly natural and had little to do with external markets or fundamentals.

Yesterday I gave an important level for judging the strength of the consolidation: 5151 points. Clearly, today it broke below the open and the rebound couldn't reclaim it, making the weak nature of the consolidation unmistakably clear. 5151 remains the key level going forward—until this level is firmly held, the broader market cannot regain strength.

Since the broader market has adopted a weak consolidation, in the language of this ID's theory, this consolidation will merge with the previous 1-minute level hub oscillation at 5010 points to expand into a 5-minute level one. Therefore, the oscillation range should naturally be viewed from this larger oscillation perspective.

On the daily chart, since a top fractal formed today but the 5-day moving average hasn't confirmed a valid break below, one cannot immediately conclude that this consolidation will necessarily leave a downward stroke on the daily chart. Therefore, the 5-day line over the next two days is critical—once it's validly broken below, then the consolidation will at least form a downward stroke, meaning one must wait at least for a bottom fractal to appear before it concludes.

However, the broader market's movement has actually become quite unimportant—many individual stocks have completely disconnected from the broader market. Moreover, as long as the broader market can maintain this 5-minute oscillation, even if it expands into a 30-minute one, as long as no third-type sell point to the downside appears, the broader market will ultimately continue rebounding upward.

If your stock has already shown a confirmed weekly bottom fractal, then simply hold using the 5-week moving average as reference—no need to pay too much attention to the broader market's oscillations. Of course, if you're exceptionally nimble, you can go back and forth sprinting, but ordinary people should forget it.

Note: when I said yesterday that I'd review previously mentioned stocks, that doesn't mean I'm recommending you buy now. Whether to buy or not, the chart will tell you. This ID is only commenting on these stocks' fundamentals from a long-term perspective. Since many stocks were recommended N months ago and most have risen substantially, if you haven't been playing along the whole way and you're the timid, easily shaken type, just watch.

600343: Getting close to its all-time high. Military industry, whole-group listing, and similar concepts.

600078: The key with this stock is what's underground—a treasure-hunting game. First there's a lot of back-and-forth tossing around; only after the underground treasure is confirmed will there be a major move.

600777: Initially there were too many players inside; later there were coordination issues with the listed company. But problems will always be solved, and once solved, things naturally improve. Though it's been a fighting-all-the-way journey, it's also risen N-fold already.

600649: We mentioned it at 5 yuan, and now N months later, it's also multiplied several times over. It's been holding above the highs—just the water resource concept alone is enough to sustain it. The only risk is potential catch-up decline pressure after the broader market rebounds, but from a long-term view, it doesn't amount to anything.

000802: Just the name alone is enough for this stock to shine in 2008—what's there to doubt?

600578: Environmental protection, whole-group listing, Olympics, and other concepts. Although it's already risen N-fold as I mentioned, it shouldn't do badly in 2008.

601111: When we mentioned it, it was under 3 yuan, and then it was "Li Junren, Li Junren" all the way to today. In 2008—if even Li Junren doesn't have a show, then how can there be any 2008?

000777: When mentioned, it was at 8 yuan. If this story can unfold, 80 yuan wouldn't be too outrageous, right? Long-term, if the whole group comes together and China Shipbuilding can reach 300, then those two characters "China Nuclear"—shouldn't they be worth 800?

Logging off now. See you.