Quantitative Program. Livermore: March 18 Review Record

Briefly about today’s market. [Taogu Ba]

Tomorrow is a key day. The market experienced a broad decline yesterday, and today saw a slight overall increase. This rally is somewhat weak; the market first fell then rose, and trading volume continued to shrink. The atmosphere hasn’t fully recovered, so it’s too early to be overly optimistic.

Guodian held for a few days, and this morning it surged and then took profit, exiting with a 20-point gain. UCloud’s bottom-fishing attempt failed; it couldn’t rebound after the previous attempt. This afternoon, after opening high, it only made a small profit before exiting. Currently, the PCB concept sector is still trapped. Today’s market mainly rebounded; for it to continue rising, it’s too early to judge. If it can keep rising tomorrow, the bullish sentiment will start to recover. So, we need to observe whether it can continue upward after today’s broad gains. Tomorrow is also likely to open lower collectively, indicating the market sentiment hasn’t fully recovered. If it rebounds after a low open, it’s probably a short-term rally at a high point, and it’s best to exit during the peak, as it’s likely to fall after a surge.

The previous short-term bullish atmosphere driven by retail investors is now being led by quantitative trading. Today’s sectors—telecommunications, computing power, packaging, and storage—are all pushed up by quant algorithms. The current standard for these algorithms is a significant decrease in trading volume, which often signals market support. Before supporting the market, they tend to lead a collective rise. After pushing prices too high, they usually exit first.

This confirms the saying: without good or bad news, prices tend to fall after rising too much, and rise after falling too much. Quantitative trading operates strictly according to this rule. So, when you see a big drop, there’s often no news behind it; when you see a big rally, there’s also no specific news. Quant programs follow a fixed mindset, running until this pattern fails or encounters significant resistance. However, they also adjust continuously.

Tomorrow still depends on market sentiment. If the mood turns positive and the market continues to rise, it may keep going up. But gains usually don’t last more than three days. After tomorrow’s rise, there will be pressure. If the rise is too fast tomorrow, selling pressure will appear directly. For complex market conditions, a simple approach works: quant trading has no emotions.