The market situation has improved.

Good evening, friends. [Taogu Ba]

Let’s briefly discuss today’s market, where a very important signal has appeared. Let’s analyze it below.

1. Sentiment

Sentiment is lukewarm; it’s neither good nor bad. The streak of consecutive limit-ups has no highlights. The five-limit-up stocks face short-term resistance, but after breaking at the four-limit-up level, there has been little negative feedback. Except for the large-cap stock Wangli Security, which is a heavyweight, others like Shun Na Shares and Ningbo Construction are performing normally. This is a positive sign, including earlier stocks like Farsight and Yasheng Group, which are still showing strength—this is a clear signal. Therefore, this area is worth paying attention to. Tomorrow, Zhongnan Culture will also open for trading, and considering the theme, it might attempt to do a turnover and consecutive limit-up.

20cm’s performance has been relatively average, with no new consecutive limit-up stocks appearing for several days. There have even been sharp pulses followed by sharp declines, like Zeyu Intelligent and Tongguang Cable, which follow the sector’s big swings and then fall back sharply. So, avoid chasing high in this area unless there’s a significant breakout with a large gap-up, indicating a breakout target.

Overall, sentiment towards core stocks with high recognition remains decent.

2. Thematic Sector

The clear signal in the thematic sector is that there is now persistence. Yesterday’s strongest sector was chemicals, and today the bidding showed strength and continuity. The core stocks, Jinniu Chemical and Baichuan Shares, are performing well. Although Baichuan was sold off at the end of the day, its trend isn’t bad, and the drop was somewhat passive. This indicates that the sector is gradually focusing and showing persistence.

In the last article, Yaojie mentioned that sector rotation has shifted from one-day wonders and internal competition to a smart preemptive half-day play, which eventually evolved into the worst pattern of opening high and falling low. After reaching the extreme, it reverses. Now, it seems to be evolving into a slow but steady persistence. So, could a main theme emerge next? Let’s wait and see.

Regarding the main theme, the following are key observation targets. First is the electrical sector, which is the most active and strongest within the sector. Although there is no absolute core stock yet, some recognizable stocks like China Energy Construction, Hanlan Shares, and Yunnan Energy Control are performing strongly. It’s similar to the situation when commercial aerospace started last year, waiting for an absolute core to emerge. We can look forward to it. At least during the process of emerging, it provides valuable opportunities for traders. $Hanlan Shares (sz002498)$

Next is the computing power sector. This area rotates frequently but generally does not have large negative feedback. As long as you don’t chase pulse stocks and hold for a day or two, you will see positive feedback and new expectations.

Then is the chemical sector. Its future depends on whether it can escape the influence of high volatility in oil and gas. Currently, the plunge in oil and gas affects it, but the sector’s resilience is emerging. If it can break away and develop independently, it will be worth watching.

That’s all…