Index Hesitates, Individual Stocks Play Catch-Up

2008/1/14 15:10:28

At this position and point in time, the market has entered a sensitive stage. First, for the bulls, having finally arrived at the most important resistance zone around 5600 points, they absolutely don't want to flinch and get knocked back. But this threshold does present significant pressure—mainly not from technical factors, but from psychological and policy perspectives.

From a policy standpoint, the Spring Festival travel rush period begins soon, so the room for policy maneuvers makes these next few days the most sensitive. If there's going to be any fancy moves, these days are the most likely window. By month-end, when the Spring Festival is approaching, everyone's busy with their own affairs—and nobody wants to serve as a shield for the Chinese national football team. That bunch is preparing to ruin everyone's New Year's Eve mood, and surely no one wants to share the risk of getting cursed out? Such a person probably doesn't exist.

So the index hesitating a bit during this period isn't too serious. Technically speaking, we're still in the second scenario mentioned previously—forming a 5-minute hub around 5462 points, which at most could extend into a 30-minute one. So the index continues its rhythm of thrusting upward a couple of times and trembling ten times.

On individual stocks, some previously underperforming sectors are starting to catch up. Since the big guys aren't suitable for a collective rampage right now, the direction of these catching-up sectors becomes very critical. The market is getting bigger and bigger now, with increasingly complex capital compositions—as long as the index pattern isn't destroyed, there are still plenty of sector opportunities.

After reaching the 5600 area, the oscillation amplitude will increase somewhat. The best strategy now is to push upward—push a bit, shake a few times—this way psychological and technical pressure will gradually dissolve. You absolutely must not rush; if you do, the foundation becomes unstable.

For those with lesser skills, on the medium term, continue watching the weekly (1,1) pattern and the 5-week moving average; for the short term, watch the corresponding daily indicators. For those with strong skills, you can use the rhythm of 5-minute oscillations for sector trading.

Signing off. Goodbye.