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CCB Leads the Market Forward

2007/9/6 15:55:55

The title is correct—it is indeed CCB (China Construction Bank) leading the market forward. The significance of CCB's issuance was already clearly explained yesterday. As the first of this large-scale wave of homecoming listings, CCB's ultimate performance will carry enormous benchmark significance for those that follow. Therefore, the scene at the end of today's session where Bank of China and others shot up rapidly shouldn't be surprising at all.

However, one point must be made clear. When this ID answered questions yesterday and mentioned certain themes regarding China Unicom, that was not anything official—just treat it as sleep talk. This ID holds Unicom shares, which many people here should know. Around the Spring Festival, there were even consecutive days of live-broadcasting here as Unicom climbed above 5 yuan. This is a stock this ID intends to hold till the seas run dry and the rocks crumble. China Mobile trades at over HK$100 in Hong Kong; if China Mobile's GSM business were all given to Unicom, this ID has no idea how much Unicom should be worth. But the scenario where Unicom handles GSM, China Mobile plays with the Datang technology, and China Telecom takes CDMA is not an official announcement—it's merely a possible plan that hasn't been finally and formally approved. This ID has actually mentioned it many times when answering questions before, but has never written about it in articles, so it can only be treated as sleep talk—anyone who believes it has problems. As for overall listing and China Mobile's homecoming, those are very definite and just a matter of time, so judgments about Unicom should be based on that.

This ID actually doesn't like answering questions about individual stocks. The stocks this ID mentions are all ones this ID is actively buying. Of course, the accumulation process may take a long time, but the first time this ID mentions a stock here is definitely the same day as when—or even earlier than—this ID's first purchase. There's no issue about that. For example, with Weichai—the poem was written on May 15th, which was also the first day this ID bought it. When this ID shares the stocks being bought, there's no question of "recommending"—it's the same as telling everyone what this ID had for lunch. Today at noon, this ID only had some fruit juice—that's all.

There's not much to say about the broader market. After filling the gap, we hit new highs—meaning Monday's gap was still just a continuation gap in nature, so the game continues.

Below, let me once again lay out the current operating guidelines in explicit terms:

  1. The moment fatal news hits, chop without hesitation—let the stocks go to hell.
  2. No news is the best news—go absolutely wild with every means available.
  3. The laziest approach: watch the 5-day and 5-week moving averages.
  4. For those three technical formations of stocks, operate them by category. (Previously illustrated with examples of 600636, 600737, and 000938.)
  5. At the current position, don't harbor any long-term plans. Long-term plans should be made at long-term buy points. Right now is just the wild game stage—the only criterion for success is: get the money into your pocket without getting cut by the knife.
  6. For medium-to-long-term investors: hold strategically and wait for the medium-term sell point to appear, then use a portion of your position for cost-reduction or chip-accumulation operations.

Among these six points, for short-term traders, the first is the most important and the second is the most practical.

Have things to attend to today, so I can't answer questions. Sorry. Signing off for now. Goodbye.