Skip to main content

Capital Presses the Advantage, Breaking the Round Top and Reaching the 3/4 Line

2007/9/28 15:51:59

Yesterday it was already made clear that capital had achieved a decisive victory, and the greatest technical danger for capital was the round top, which had to be broken by the holiday at the latest. Today, the bearish news about real estate actually became a huge positive for stock market liquidity—if capital didn't press the attack now, that would be brain-dead. So what unfolded was a brilliant act of pressing the advantage, breaking the round top and reaching the 3/4 line.

Note, this ID has already said that in the dancing-on-the-knife's-edge phase, it's a slaughter of both bulls and bears. Those with one-track minds are destined to be slaughtered—not being slaughtered now is merely a matter of time. When a certain pattern repeats enough times, the death sentence arrives for those who believe in that pattern.

This ID believes in nothing. Whatever the market shows this ID, that's what this ID acts on. This is the sole center and fundamental point of this ID's theory. For example, in the chart below, after the third-type sell point at 132, the 1-minute move to 137 completed, and the trend was extremely standard and perfect. Those interested can measure 130–131 and 136–137—the lengths are essentially equal. As for strength, just add up the areas of the corresponding bars below and you'll know what to do. By 138, it became clear that this 5-minute third-type sell point had no chance. Even if you didn't react at 137, point 139 gave you a chance to react.

Of course, from the perspective of hub oscillation, there's no need to predict how high it can go next—let the market tell you. And today's trend was so ferocious that not a single line segment was ever broken. Isn't it crystal clear what to do?

The post-holiday trend is very clear: first, this 1-minute departure must be completed. From the current situation, this 1-minute departure trend most likely starts as a line-segment-type uptrend. Unless there's particularly major news, once the line-segment-type uptrend ends, a 1-minute hub will inevitably form. After that hub, whether the 1-minute trend turns into consolidation or an uptrend, once the 1-minute move is complete, the key is whether the pullback can form a third-type buy point for the preceding 5-minute hub. If it does, the market will continue attacking upward; otherwise, it will fall back into the 30-minute hub oscillation.

Alright, the analysis above is already very clear. Anyone with some understanding of this ID's theory should get it. For those who don't understand, this ID has repeatedly said: for a medium-term perspective, just watch the 5-week moving average. Look—yesterday's low was right on it, just like the time at 5000 points.

On fundamentals, let me tell everyone clearly: the most likely news for after the holiday is about transferring part of state-owned shares to social security funds. Regarding this news, this ID and those around have some disagreement. This news means that in the future, selling state-owned shares won't require any notice—it can happen anytime. But with currently abundant capital, it's entirely possible for this awkward scenario to occur: every batch that comes out gets bought up immediately. After all, those state-owned shares are all "China-prefix" companies—China's finest enterprises. So this ID remains skeptical about this policy's actual destructive power. However, ultimately we must see the market's reaction. This ID won't have too many preconceptions—only caring about the market's resultant force itself.

To truly crush capital, the potentially effective policy moves are: 1. Investigate mutual fund scandals; 2. Mandate that A-shares with less than 10% float must increase to 10%; 3. XXXX.

Policy will inevitably win—there's no doubt about that. But this ID has no interest in either capital or policy. The only thing this ID is interested in is exploiting the market opportunities created by their battle to slaughter both bulls and bears.

Regarding individual stocks, nothing much to say. China-prefix stocks and theme stocks—the two butterflies continue fluttering and teasing. As long as you master the rhythm, it's a trading paradise. If you don't understand what rhythm means, here's an assignment for everyone: from daily fractals down to smaller-level trends, thoroughly analyze 000938—it's entirely a textbook.

Holiday time—let the stock tofu rest.

This ID will write another post tonight. Tomorrow I'll be heading out for some indulgence. The blog will be closed until October 7. Reopening on October 8.

Wishing everyone a happy holiday.

Signing off, goodbye.