Hexun Investment Advisor Feng Lushun: On March 17, How Will AI Applications Develop Next?

On March 17, we analyze the trends of AI applications, domestic software, and the artificial intelligence sector. These sectors have been adjusting for some time, so are they now in position? We analyze this through volume and price relationships.

First, from a trend perspective, a downward channel line can be drawn—connecting previous highs and secondary highs, forming an upper resistance line. For any sector to shift from a downtrend to an uptrend, the first step must be a successful breakout above this resistance line. Recent rebounds show that the index has touched this resistance line multiple times but failed to break through, indicating persistent resistance above. After failing to break out, the index has chosen to pull back.

From a long-term cycle perspective, the sector has now retraced to near the 10-month moving average. Looking back at historical trends, this sector has often found support at the 10-month line and rebounded, a pattern that is quite clear. Therefore, the current position has a certain technical support basis, and the rebound could be imminent.

This also confirms our repeated emphasis: a long-term retracement is a prerequisite for an upward move. Without a decline, there is no room for an increase. Only after sufficient adjustment can space for a subsequent rebound be created.

However, it’s important to note that reaching the long-term retracement level is just the first step. To truly move into an upward trend, a confirmation of stabilization on a shorter cycle is needed. “Short-cycle stabilization” requires meeting several technical conditions: a golden cross of the 5-day moving average over the 10-day moving average, and a MACD turning positive. Looking back at previous upward moves, they were launched after the moving averages experienced a golden cross and the MACD turned red. Currently, the moving averages are still in a death cross, and the MACD is below zero, indicating the short cycle has not yet stabilized.

Therefore, for AI applications, domestic software, and the AI sector, the current stage is still a bottoming phase. The real upward trend requires clear breakout signals: first, a volume-driven bullish candle breaking through the downward channel line; then, a golden cross of the 5-day over the 10-day moving average; and finally, MACD turning positive. Until then, patience is advised, waiting for confirmation on the right side.

(Editor: Zhang Yan)

【Disclaimer】This article reflects only the author’s personal views and has no relation to Hexun.com. Hexun.com remains neutral regarding the statements and opinions expressed and does not guarantee the accuracy, reliability, or completeness of the content. Readers are advised to use this information for reference only and bear all responsibilities themselves. Email: news_center@staff.hexun.com