[Red Envelope] 4.7 Pre-market: Fiber Optic OCS under Weakness, New Speculation Path Continues to Evolve and Receive Attention

It is produced in the midst of change—seizing the situation, seeking the situation, borrowing the momentum, and riding the momentum. [Taoqiuba]

Recently, changes in the market have shown fairly obvious “crowd-trading” dynamics. Trading volume is trending downward, the money-making effect is weakening, and localized capital is clustering. In the previous stage, crowd-trading gave rise to a green-power theme: Huadian Liaoning Energy and Huadian Energy. Last week, crowd-trading in the market created the fiber-optics theme: Hangdian Co., Ltd. and Yangtze Optical Fibre & Cable; plus AI hardware OCS—the OCS optical platform—led to stocks such as Opto-Tes and Deco Li, among others. Overall, these are localized crowd-trades. Tech “standalone” hard-logic stocks move along their own trend, and the difficulty in the market is clearly visible. Continuing from the new path discussed in earlier articles, I’ll keep exploring downward: In the previous post, using Hangdian Co., Ltd., Yangtze Optical Fibre & Cable, and others as examples, I outlined the possible evolution paths for a new type of speculation. Judging from the results, these paths indeed emerged, and the resulting money-making effect was also quite good. Next, we should observe whether this money-making effect will spread into other directions, and whether capital will imitate it.

At present, there is a lot of discussion online about quant strategies. Claims about “quant reducing its trading frequency” are rumors! Many messages in the market still need to be verified. When the market is weak, people will always find various reasons to shift the blame. The masses need an outlet, but from a rational perspective, the quant strategy perspective increases volatility, exacerbates both upward and downward movements—this is a fact. Most importantly, there is also the iteration of quant, the issue of quant scale, and the fact that the market’s short-term capital will also imitate quant. From the standpoint of what happens next for the market, this is a trend at this time.

Data:
Yangtze Optical Fibre & Cable, during the consolidation period, the peak-to-trough retracement during the consolidation period was 22.92%, and the recent swing from initiation to the highest point rose 70.89%
Hangdian Co., Ltd., during the consolidation period, the peak-to-trough retracement was 20.21%, and the recent swing from initiation to the highest point rose 45.55%
Farsen Victory, the smallest peak-to-trough retracement was 16.61%, and the recent swing from initiation to the highest point rose 29.40% (volatility/abnormality issues)
Judging from the consolidation time:
Farsen Victory at least 8 trading days,
Hangdian Co., Ltd. 14 trading days,
Yangtze Optical Fibre & Cable up to 19 trading days.

At present, the market’s momentum is:
Right now we are in a weakness-driven “1, crowd-trading; 2, oversold rebound.”

Crowd-trading is mainly led by AI hardware—fiber optics, OCS, and the like. The stocks are basically driven by fundamentals + industry catalysts + earnings expectations.
Fiber optics:
Yangtze Optical Fibre & Cable, Hangdian Co., Ltd., Farsen Victory, Hengtong Optic-Electric
Follow-on strength: Sunerton Green Energy, Huiyuan Communications

OCS:
Eopt Optics, Deco Li, Tengjing Technology

Oversold rebound led by innovative drugs:
Jin Yao Pharmaceutical, Wanbangde, Shuanglu Pharmaceutical, MeinuoHua
Chongyao Holdings, China Medical, Haitai New Optics

Other:
Computing power:
Yunshang Zhiliang, Zhenzhen Technology, SichteQ,
AoruiDe, MeiliYun, Litong Electronics, Hongjing Technology, Huanhuanxinwang, Data Harbor.

Liquid cooling:
Youtong Technology, Far East Holding

Cross-border payments:
PetroChina Capital, Cuoweishares

Shipping:
China Merchants Nantong Oil, China Merchants Energy Shipping

Commercial aerospace:
Tongyu Communications, Regen Technology, God Sword Co., Ltd.

Overall:
The market is still the same market; it’s just that the difficulty has increased a lot. It can’t reach new highs, and it’s also the jg issue—chasing-higher capital is very uncomfortable, and quant strategies repeatedly smash the chasing-higher capital. On the short-term trading ecology, even the intraday top names might not get any premium the next day, and the trend direction also shows increased volatility. Try to use trend swing trading to fight against quant. Stay patient toward directions with solid logic. After the market rebounds, or once the second “foot” comes out upward, chances are it will still be mainly AI technology. Only directions with hard-logic support are easier to be traded and re-traded repeatedly!

The market continues to rotate. Quant attacks any direction randomly—it depends on news stimulation and quantcl, randomness is tilted upward. But at this point, it’s not advisable to be pessimistic. For swing and medium-term, this position is likely to be biased toward lower levels. If it falls, you don’t dare to go in; if it rises, you start to ask why you didn’t go at the time. Of course, the market is full of uncertainty. And this bull market—still, it’s a bull market of localized themes. Buy the right direction and feel great; if you buy the wrong direction, you still have to lose—this time the broad-market rally situation won’t come back again ~~!

Sorry, everyone—bosses, please like and点赞. Thank you.