Logic and market path deduction of the lithium mining sector's surge (Review)

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[Taoguba]
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We will summarize the market for everyone; all content is based on simulated deduction and is purely personal sandbox thinking, not constituting any real trading advice. As market volatility intensifies, only clear logic can lead to stable and long-term performance. Please remember: the market always prioritizes risk; only by surviving can one wait for the flowers to bloom.

The three major A-share indexes opened lower today but rose by the close. The Shanghai Composite Index increased by 0.63%, closing at 3913.72 points; the Shenzhen Component Index rose by 1.13%, closing at 13760.37 points; the ChiNext Index rose by 0.71%, closing at 3295.88 points. The trading volume of the three markets, Shanghai, Shenzhen, and Beijing, reached 186.4 billion, decreasing by 93.1 billion compared to yesterday.

Most industry sectors rose, with energy metals, chemical pharmaceuticals, medical services, agricultural chemicals, small metals, biological products, rare earths, chemical raw materials, non-ferrous metals, and precious metals leading the gains, while insurance and banking faced the largest declines.

In terms of individual stocks, over 4300 rose, with nearly 100 hitting the daily limit. Lithium mining concept stocks surged, with Jiangte Electric, Chuaneng Power, Tibet Summit, Shengxin Lithium Energy, Rongjie Co., Yongxing Materials, Ganfeng Lithium, and Jinyuan Co. hitting the daily limit.

In terms of capital, energy metals had a net inflow of 3.949 billion, leading the sectors, while electricity, communication equipment, and photovoltaic equipment experienced net outflows, with electricity netting outflows of 4.314 billion.

【Market Review: Monday Clearly Sees the Bottom → Rises to Repair and Consolidate】

It is clear that the market has undergone a first and second bottoming process; it remains to be seen whether it can break through 3860 and touch 3800 once more. On Friday, the market opened low, directly breaking 3860 but quickly recovered, closing above the strong support at 3906. In the afternoon, driven by a surge in lithium carbonate futures, major funds saw net inflows, maintaining a strong buying trend throughout the day.

Currently, the index is still in a consolidation phase, and the bottoming box is being perfected. If there are no particularly negative factors over the weekend, this position will rely on 3860, fluctuating around 3906 until it stands above the 5-day moving average, gradually completing a half-arc bottom, and then later attacking the gaps at 3937-3955. I believe that after a wave of volume, the index will move along the 5-day line, leading to a slow upward trend; therefore, during this stage, we only look bullish and not bearish. If the bottoming takes a few more days, just ignore it. The dragon and tiger list features a few standout names: Zhang Mengzhu, low-position digging, Zhongshan Road, Xu Xiao, Chengdu system, Stock Trading Family, Wenzhou Gang; most are still contributing to the board through quantification; where there is a limit-up, there is quantification. Keep an eye on the sentiment:

【Logic of the Surge in the Lithium Mining Sector and Market Path Interpretation】

Yesterday, the lithium mining sector surged, not as a rebound from overselling, but as a complete campaign driven by global geopolitical conflicts and a layered transmission of funds.

Starting Logic: Simultaneous Ignition on the Supply and Demand Sides

On the supply side, two “supply disruption” messages directly broke through the market’s psychological defenses: first, Australia’s “diesel shortage”—Australia relies on imports for 90% of its refined oil, with stocks sufficient for only one month. In fact, not only Australia but also countries like Thailand and other Southeast Asian nations have severe shortages. The conflict in the Middle East has tightened diesel supplies; Australian mining company Fenix Resources announced it was forced to reduce mining operations due to diesel shortages. Australia supplies nearly 30% of the world’s lithium resources; if diesel shortages continue, mines will face the risk of production halts. Second, Zimbabwe’s export ban exceeded expectations—this country suspended lithium concentrate exports at the end of February, and the ban has not yet been lifted. Zimbabwe’s lithium concentrate is almost entirely exported to China, accounting for nearly 20% of China’s imports.

On the demand side, international oil prices surged above $110 per barrel, causing a swift market logic shift: high oil prices will force more consumers to turn to electric vehicles and exacerbate “energy anxiety” in Europe, stimulating an explosion in household energy storage demand. Institutions estimate that the return on photovoltaic storage projects in Europe and Japan/South Korea has thus increased by 2-16 percentage points.

Supply contraction + demand expansion equals a “double blow.”

Capital Path: A Complete Campaign

· 09:00-09:15: Lithium carbonate futures main contract opened high, surging over 6% at one point, breaking through 168,000 yuan/ton. The futures ignited, setting the tone for the day’s market.
· 09:30-10:00: Leading resource giants Ganfeng Lithium and Tianqi Lithium were the first to see volume, with the first 15 minutes achieving a trading volume surpassing 3 billion. Large funds confirmed the “international supply crisis” logic with real capital.
· 10:00-11:00: Rongjie Co. sealed the board at 10:40, becoming the first elastic target; Yongshan Lithium, Shengxin Lithium Energy, Yongxing Materials, and Chuaneng Power subsequently sealed boards.
· 13:00-14:00: Shida Shenghua sealed the board at 13:10, with funds spreading to midstream materials; Tianci Materials surged 5%, and trading volume drastically increased.
· 14:00-15:00: CATL, BYD, and Yiwei Lithium Energy increased their volumes, completing a catch-up for downstream leaders.

This is a complete campaign from futures ignition → resource leaders defining direction → elastic small stocks igniting sentiment → industry chain diffusion.

【Old Script for Segment Holding, Clearly Understanding the Present, Enables Choice of Stay or Leave】

1. Yixintang: Traditional industry, stable performance. The sector is at a low position, a rebound of 15+ can be easily achieved. Recently, after bottoming, it pulled back to 14+; if there is profit at this position, it is recommended to make a choice. If the target is 15+, be prepared for a platform pullback.

2. Daye Co.: Four large bullish candles: 12cm, 7.6cm, 10cm, 7cm. It was clearly stated twice to take profit; those who have done this can achieve a gain of 8-15%. Recently, it was clearly stated to hold off for now, waiting for 31+. Friends who entered at the peak can expect a surge on Monday or Tuesday to resolve their positions. Congratulations to those who have been trapped for a long time; you can unfollow next week.

3. Qiming Star: Still in the left side of the chart, not yet completed the weak to strong transition. The most optimistic scenario is a rise first, followed by a pullback that does not break the bottom; right side formation can occur here. In the short term, watch for a pullback to around 14; if this position can turn red, it’s recommended to take profit. It is challenging to get out from a high position in the short term.

4. Longtou Co.: Continuing to bottom, watch for the 5-day line not to break. It should first rebound to around 9; if there is profit, make a choice. The consumption sector may see a wave of activity in April; let’s see if it can complete a gain of over 10+ at this node.

5. GoerTek: Continuing to bottom, wait for a breakthrough above 26. The long-term cycle indicates this is the bottom, but it will take a long time. The V shape should complete 28; at the earliest, it will take 1.5 months. Short-term participation is not recommended; it can be held for the long term.

6. A certain health stock: Continue to wait for a bottoming rebound. From a position-building perspective, this is the golden bottom. A large bullish candle will definitely pull back; hold on and do not move. The bottom is estimated to take another 2-3 days before any upward action occurs; just hold on for a few more days, and clarity will emerge.

【New Script and Short-term Games】

1. East China Heavy Machine (Unfollow): Two limit-ups in four days. On March 24, it surged against the trend, and I said it would pull back after two days of consolidation, and it indeed surged again on Friday. From losing money to making money, it perfectly resolved the losses from the recent stock disaster; after two limit-ups, unfollow.

2. Yidao Information: Previously had consecutive large bullish candles of 7-8 points, impacted down by the war. 90% of stocks are in the same situation, so there’s no need to worry about losses. First, watch to see if the bottoming is successful; if successful, it will rebound to around 45. Now is not the time to exit; at what position are you reducing when others are adding?

3. Beiyinmei: The bottoming process is not yet complete. The company is expected to reorganize; a few days ago, it surged amidst the stock disaster; it was not explosive volume but an increase in volume, indicating accumulation of chips. After the bottoming, it will rebound and seal boards. The rebound may not be one step, possibly taking two steps.

4. Jingxing Paper (Xingye): The other day, only 305 stocks were in the green across the network, and it rose by 7 points. The trend has not damaged the bullish trend in recent days. It remains strong without breaking support. In the future, continue to expect large bullish candles to break upward; in the short term, watch for around 7 yuan.

5. Beidouxing Tong: The bottoming process is nearly complete. On Monday, aim for a small bullish candle to stand above around 38, and break out with a large bullish candle before Thursday. Ideally, reach 45 before Friday, and then you can choose to stay or leave.

【Performance Review】

Before the New Year: Rainbow Group, Rainbow Co. (both limit up), Ningbo Ocean (limit up), Zhongrui Co. (limit up in three to four days), Zhongshui Fisheries (second limit up after 11 points), Xiexin Integration (numerous limit ups, becoming a monster stock)

After the New Year: Huayin Power (28 points in consecutive limit ups), Intelligent Control (28 points in consecutive limit ups), Chuanfa Longmang (two consecutive limit ups), Yidao Information (two large bullish candles in two days), Jiangnan High Fiber (15 points limit up), Daye Co. (four large bullish candles: 12cm, 7.6cm, 10cm, 7cm), Hengtian Hailong (20 points in three days), Shun Na Co. (one-day limit up), Beiyinmei (7 points increase during the stock disaster), Jingxing Paper (7 points increase with 305 stocks in the green during the stock disaster), East China Heavy Machine (two limit ups in four days), Dashengda (one-day limit up; personal private life not disclosed)

Stocks that have not been unfollowed will continue to be updated, providing ongoing arbitrage value.

【April Outlook】

In April, consumption and tourism will see a small wave of activity; the market will not wait for May 1 to exert strength but will advance early. For those with relevant positions, hold on if you can; do not indiscriminately cut losses; opportunities in other sectors will not be mentioned, just a complaint for those holding consumption stocks to take care of themselves.

This week, I clearly stated that the bottom would be seen on Monday—not “high probability,” but “100%.” At this position, a large amount of capital, including social security funds, is bottom-fishing. From a larger cycle perspective, this is a phase of accumulating chips. The index has been bottoming for three days; after a few more days, it can pull up. Most individual stocks do not need to cut losses.

On the futures side, oil is very interesting; volume has shrunk like this, both bulls and bears are panicking, and no one dares participate, waiting for external news. As long as you pay attention to the market, you can find new insights every day.

【Conclusion】

Reviewing the market is a kind of habit, but it is also a type of cultivation. Spending half an hour each day to sort through the market and examine positions, even if just a little progress is made, over time, it will yield astonishing compounding returns.

The market is never short of opportunities; what is lacking is the eye to discover them and the patience to wait for them. Learning to make choices is essential to navigate through fluctuations.

If you find the review helpful, please like, interact, and leave comments. A casual like can make earning a million a day not just a dream! See you next week!

The market is unpredictable; take care of yourselves, wishing everyone tranquility. — Dayunbi.

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Note: My replies aim to provide different perspectives for consideration, not to promote or recommend stocks; it is purely a logical exchange. I hope everyone treats this as a discussion area for mutual improvement, but do not blindly follow the crowd.”**