3.23 Review: Market Launches Defense of 3800 Points, Emma Electric Vehicle Hits Daily Limit—What's the Intention?

Last week was still a 4,000-point defense battle, but tomorrow it will be a 3,800-point defense battle. The index is accelerating downward, leading to a sell-off, and bottom-fishing funds are still hesitant to enter the market, causing a collective “kill all” retreat in quantitative trading. Liaoning Energy successfully broke through to the 6th board, breaking the previous high and diverging with various “energy” stocks to catch up. The market is accelerating its adjustment, while on the other side, ultra-short traders are celebrating and grouping together. Indeed, people’s joys and sorrows are not interconnected, so how long can this group-beating trend last? Please like and follow before we begin today’s review.

Huadian LN
Liaoning Energy’s performance today exceeded expectations. If earlier boards were mainly driven by low-priced strength, today it took the initiative to strengthen, becoming comparable to Yunnan Energy in recognition. The large volume of 130 million at opening indicates sincerity. After the initial panic, market sentiment hit a low, and funds could only focus on recognition and grouping. Currently, Liaoning Energy, with the highest board, is the most recognizable stock. After advancing to the 6th board today, the market re-emerged with various “energy” stocks catching up. The “energy” stocks already showed some excitement in the morning, so caution is needed: when the index rebounds in the next two days, this “energy” grouping may face a risk of disintegration. For Huadian, even if it breaks the board later, it may consolidate at high levels and turn into a trend, similar to Yunnan Energy. If Yunnan Energy breaks the board in the next couple of days, watch for low-priced first boards and stocks that may experience the fifth round of power cycle catch-up.

Jinkai / Nengke / Energy
In the context of the index accelerating downward, groupings are also beginning to shrink and face淘汰. Jinkai was hammered after two consecutive days of rising, but the morning rally was driven by Huadian’s quick move to the 6th board. Plus, with main funds trapped on Friday needing to do T+0, why wait to sell? Having been fooled twice before, it has changed Jinkai’s nature. A break below the moving average in early trading was the first sign to exit. From the daily chart, two long upper shadows in a row indicate a “kill all” market. This supports the earlier view that groupings are shrinking and淘汰. The future of Jinkai depends on whether the current box support holds. If it breaks below the high-level consolidation range, it essentially signals淘汰.

Nengke today still shows no independence from Jinkai. From a minute chart perspective, its initiative is even weaker than Jinkai, and the pattern has already deteriorated. In contrast, Energy, although not very proactive today, benefited from Liaoning Energy’s sixth board mood, temporarily turning red and relieving Friday’s selling pressure. It was quite considerate. In the afternoon, as the index continued to dip below 3,800 points, the recognition of power stocks’ trailing trend began to weaken. Among these three, one might be misjudged, so tomorrow we should watch who is most proactive in recovery.

Yunnan Energy / Hang Electric
Liaoning Energy’s quick rise to the 6th board early in the morning benefited not only its immediate lower-tier stocks but also the older generation like Yunnan Energy and Hang Electric, which naturally enjoyed some benefits. Based on Yunnan Energy’s pace, it may challenge the double-top in the next day or two. To avoid breaking the previous high and turning into a double-top, it’s a reminder to reduce positions rather than add in the coming days. The same applies to Hang Electric—if Yunnan Energy and Hang Electric do not break down, the entire power and computing cycle is still ongoing.

Meili Y
As a spark of computing power, Meili Y performed extremely strongly today. Weak-to-strong rebound with red volume oscillation, refusing to adjust with the index. By the end of the day, as the index accelerated downward, Meili Y became a contrarian, pushing the market higher. Its recognition was maximized today. If the index rebounds in the next couple of days, and if the tech sector needs to advance, market participants will first think of Meili Y. We previously mentioned that Meili Y’s continuous K-line pattern remains valid today.

Fale / Guosheng
XinduoDuo’s dual-core engine continued to exert strength today. In the context of the index’s accelerated correction and quantitative “kill all” environment, only strong institutions can resist this environment. From volume and price perspectives, both Guosheng and Fale show no major issues. However, caution is needed when the index rebounds, as groupings may face disintegration risks.

In summary, although the index dropped from 4,100 points to 3,800 points over three days, short-term traders probably won’t feel much pain. Instead, the market has become more focused on some high-level groupings. Only in a bear market does recognition and height emerge. Since the market has been accelerating downward for three days, short-term group traders have enjoyed about a week of gains. The cycle of extremes always reverses. For short-term traders holding high positions, it’s best to hold steady; for those without positions, it’s better to buy low and catch the next wave or new themes at the first board, rather than blindly rushing into high positions.

That concludes today’s review and outlook. Review is not easy; your likes and follows motivate me to continue. If you have questions after reading, feel free to discuss in the comments. See you tomorrow!