The Market Has All Technical Conditions for an Upward Attack

2008/2/29 15:18:56

Today, the MACD red bars finally reappeared—this is the result of two entanglements of the yellow and white lines, so it deserves special technical attention. Under normal circumstances, such a pattern will cause the yellow and white lines to return to near the zero axis, corresponding to an upward attack movement for the market. However, it's precisely under such conditions that fake signals most commonly occur. Fake signals don't happen often—probably less than once in ten times—but the possibility exists.

The market has all technical conditions for an upward attack. Many sectors have also been warming up for several days. Therefore, barring any sudden news on the fundamental front, the conversion of this high-probability scenario into actual movement would be very natural. Possible destabilizing factors are just a few: first, a sudden large-scale decline in overseas markets; second, another upgraded farce like the Ping An or Pudong Development Bank incidents; third, some rumored so-called positive news proving to be groundless.

Since these factors are not entirely within the market's control, taking things one step at a time is the best trading approach. According to this ID's theory, none of this needs to be considered, because the oscillation around 4331 has already extended to the 5-minute level. So just watch for the third-type buy or sell point of this hub, and everything else can be treated as hub oscillation.

The key level above, as mentioned earlier, is 4391. This level must be effectively broken through and held; otherwise, the movement cannot extend into a stroke.

Regarding sectors, it's still the same as previously mentioned: agriculture, chemicals, consumer goods, environmental & new energy, military, venture capital, Olympics, restructuring, etc. If gold goes above $1,000, resource stocks will have a short-term burst. For high-bonus stocks, if they didn't perform before the ex-dividend date because the market wasn't cooperating, their performance may come during the ex-rights fill period. For example, 002202 these past few days is a classic example.

The market has had many disasters recently—often just when it's about to truly move, something suddenly pops up, so much force has been suppressed. But force must eventually erupt. Even if another sudden event comes this time, it only stores energy for the next eruption. The bread will come.

On weekends, rest comes first.

Signing off, see you later.