[Red Envelope] 4.7 Review; What's the outlook after the medical sector rotation? Does the index have a second leg? Vita analysis!

Short-Term Daily Trading Principles:[TaoGuaBa]
Generals on the march—don’t chase little rabbits!
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The system is more important than opportunities; discipline is higher than intuition!**
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The most confusing thing about the stock market is that every day there are “rabbits” running through the limit-up—hot topics, other people’s explosive gains.**
But every rabbit you can’t help but chase in is, in essence, an out-of-pattern trade.
You don’t have the corresponding entry logic, exit conditions, or a risk-control plan; the moment you chase in, you’ve already handed the outcome to luck.
Top traders aren’t the ones who can catch every opportunity—they’re the ones who can hold back from catching chances they shouldn’t catch.
They know this well: losses within the pattern can be reviewed and improved, but profits outside the pattern will corrode discipline. The latter makes you feel like “I’m great,” and then next time you’ll bet heavily again, continuing to trip over the same mistakes.
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The first stage of truly mastering trading is knowing how to give up—giving up the price moves you don’t understand, and giving up money that isn’t yours.**
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About the second leg of the index:**
To find the cycle for this round’s sell-off, it’s actually quite simple to map to the comparable period. The earliest conflict goes back to the Russia-Ukraine conflict—that is, from the start of 2/24 in 2022 through April. Below, I’ll list the K-line chart for everyone to reference.

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Combined with the recent market走势, the daily oscillations have been relatively exaggerated. This includes today’s early-session repair expectation—it almost didn’t hold support. So, from the current stage, the index can’t keep oscillating downward; otherwise, before mid-month it very likely will touch the second leg. For whether the second leg is good or bad, it’s also pretty straightforward: the upside benefit is that in the short term, funds will collectively step in to push a move in the direction of the index, which is positive for broadly “pan-tech” stocks—including the medical direction that has continued to resonate throughout this round.
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The downside is more exaggerated: it will burn through the expectations for this bull market. So the best market script is for it to directly consolidate upward in a short time, instead of selling off downward. That way you’ll have a clear expectation gap. And since the recent short-term market has still been doing relatively well—at least for “dragon-searching/dragon-chasing” players, the difficulty isn’t high.
I also shared at the end of February: Yunnan Holdings (YunNeng Holding), and then the subsequent Gold Bull Chemical, Huadian Liaoneng, and from there to Menovo (MeiNuoHua) and the current JinYao Pharmaceutical (JinYao). Every one of them was a precise scenario forecast. Conversely, for some friends who like to chase sector rotation, it isn’t very friendly—because if the index can’t show sustained continuity, then if it repairs today it may sell off tomorrow. Once you go back and forth, your mindset is very easy to blow up. During this period, everyone should learn to “go to cash” with dragon-chasing strategies! Only then can you better capture the行情 in each stage!

1. Market Sentiment Cycle

1. Overall market environment, theme performance
   At the open, the three major index indicators all gapped up and then moved to repair. But trading volume didn’t expand noticeably; the strongest direction at the opening auction was fiber. The trend stocks saw a move up then a pullback during the day; sentiment small caps got strengthened, and during the session I also shared them with everyone. Sentiment small caps are extremely likely to be the objects of the “outer-cut” rotation. During the first time the index pushed upward intraday, the resonance was in the chemical direction. After that, medical also stabilized and pulled back. But after medical pulled back and finished, the market started shrinking volume—so it caused the market to begin pulling back approaching the lunch close.

Then time came to the afternoon. The limit-up data was very sluggish last week. But on the first day of this week after the holiday, the data clearly warmed up: from just under 40 limit-ups in a day, to today it directly more than doubled, reaching 100—this is a positive signal. As for the direction that showed unusual activity at the close, it turned out to be an independent sports direction. The data gave positive readings, but when funds pulled up an independent theme, the attitude wasn’t positive. It proves that at this position, funds still don’t think the market will have a sustained repair. The index oscillated near the flat line into the close; staying red and stabilizing was also pushed back by the broadly pan-tech direction. Today’s tech contribution was substantial—but the fund/lot structure is still very complicated! You can’t make an overly subjective call on continuity! Overall into the close, the funds only pushed three directions: in the afternoon, chemicals, sports, and pan-tech. Commercial aerospace was just a blip and didn’t show effective strength. That completes the day’s scenario of the market!

2. Index cycle
   As long as the medical direction doesn’t end, this index cycle will keep strengthening: the index anchor at 3794—if it doesn’t break down—then the new cycle will still be ongoing. The key stop/hold-off point is still anchored at 3/24. The new resonant direction is medical, which continues to strengthen. What the market is playing out is still the same script as what was given last week. Today there was basically no change at all. So it isn’t that the scenario forecasting (vita) was too accurate—it’s because most of the time the market behaves like this. If you study the execution mindset seriously, you can quickly become a short-term trading expert!

New cycle
(1) From 3/24, the index bottoming as the starting point—up to now, the earliest pattern was a trend reversal into consecutive limit-ups. After TianYao broke through, it became a consecutive-limit reversal of the trend.
Trend core: Wanbangde, Jiu’an Medical, Caleine, Menovo, Shuanglu Pharmaceutical, and Luyan Pharmaceutical.

Supporting themes: commercial aerospace, pan-tech, Fujian Strait, sports, etc.
Intraday pan-tech is generally weaker in the morning, then at the close it follows the sports close as the strongest. Commercial aerospace flows back at the close, and Fujian Strait’s core stays red across the whole day. In the coming week, these directions will have “elimination matches”!

2. Core Stock Analysis
Short-term trades can only play one direction, so I’ll analyze only that one direction. Other directions rotate with a lot of randomness, so they’re outside my personal observation scope!
(1) Medical
Ahead of the trend: Jiu’an Medical
In the recap on Friday, I explained the定位 of this stock. What you need to do daily is to raise the arbitrage convertible bonds (convertible bond arbitrage) with higher price action. Up to today, it’s still raising the convertible-bond arbitrage and then pulling back. But today the intraday sell-off point was also pretty interesting: it was precisely where the 10-line was being supported by funds. So next, we just need to see whether funds will continue to support around the 10-day moving average. In the short term, the value of the common stock is slowly becoming smaller. Unless it breaks above new highs beyond expectations, this position is still mainly about the convertible bond arbitrage.

Sentiment core: JinYao Pharmaceutical
The sector on Friday was driven by passive divergence. That’s because it was close to the holiday, including Jinyao Pharmaceutical accelerating further—so naturally funds were very cautious. And why I judged the sector to be the leader in its first divergence, also using JinYao Pharmaceutical as the anchor. The market opens with funds quickly grabbing the consensus—clearly that’s not a sustainable approach. When it reached the seventh board, and it still didn’t swap hands, obviously it would easily lead to an A-kill. After it failed the board, the sector’s divergence became obvious intraday. Some of the core stocks were sold down to near limit-down. After JinYao stabilized again, it then pushed the sector back into a return flow. At this stage, trend stocks—besides Wanbangde and Jiu’an Medical—seem to have had their expectations lowered for other names. The main reason is that the height of consecutive-limit breakouts reached a certain level. For tomorrow’s market, for trend stocks, besides the two mentioned above, trend stocks must show strength—only then can we judge the persistence of the sector cycle. As for consecutive-limit stocks, once they break their board tomorrow, that’s a selling point. Also need to consider the overall market factor. If the broader market shows weakness, then the board-up has one last value—meaning in a weak market, making consecutive limit-ups is a kind of “group hug” by the trading crowd.

Trend core: Wanbangde
The late-day buying into the close was quite aggressive, but tomorrow it still needs to keep controlling abnormal movements. For this kind of absolute recognizability, I already discussed it earlier: only bottom-pick/buy on dips is fine. Also, in this round the consecutive-limit height has opened up, so for trend stocks there’s naturally more upside space. Most of the “ice-fan” crowd already has an early position. As long as the stock surges sharply in the morning, you reduce position. If it gaps down at the open, then wait to do T. The play isn’t difficult. Second, also watch out for the sector’s second split after JinYao Pharmaceutical breaks its board.

Trend core: Jiu’an Medical
Two consecutive days of shrinking volume isn’t good. Tomorrow it must increase volume. Continuing to shrink could bring expectations of breaking through the 5-day line. This stock is actually also controlled by the main force (the “zhuangzhu”). In the short term, there’s no need to constrain from the deviation value. If it then sells off to kill-down, internal funds might switch positions. Then you can pay more attention to names like Caleine from earlier!

Trend rotation: Caleine
This also has two consecutive days of shrinking volume pullback. The biggest advantage here is resonance with the index rising—it also resonated with the sector. And in the short term, the upside space is relatively large. After the high shows power depletion, and waiting for the second split, the key is whether this stock can then move into a main uptrend (major advance). So at this stage, it can only be observed. After the sector does the second split, then see whether there are any actions. The next time it hits a limit-up is normally a buy point. But if it doesn’t make a limit-up move, still don’t chase higher!

Trend rotation: Luyan Pharmaceutical
Both Luyan Pharmaceutical and Shuanglu Pharmaceutical are, in the short term, relatively identifiable core names. They’re also cores that resonated with the sector strength earlier. Intraday, the first split choice that pulled up was Luyan Pharmaceutical. On the contrary, when Shuanglu Pharmaceutical pulls back, the positioning of these two will be fairly clear afterward: they rotate. The key point is: who can form the trend like Huadian Energy (HuaDian Energy) and keep it going.

High-beta stocks pull back all day; there’s still an expectation gap.
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3. Sector Analysis

1. Medical: starting from 3/24, during the sector’s main run, it has already entered the tenth trading day. On day 10, the sector saw its first split. The next round of divergence is the second split. A normal second split is a focused node and the key point for high-to-low switching. The anchor is JinYao Pharmaceutical breaking its board, as well as the shift from consecutive-limit switching. In this wave, if JinYao shows too high a height, then the sentiment small caps’ heights will need to be lowered. And for the names you rotate outward into, you need to raise expectations. So the play in the next round of consecutive-limit isn’t focusing on other high-to-low small caps within the sector; instead, pay more attention to the core names rotated outward. The question is: who will be selected by the market? After all, JinYao only reached the seventh board before the divergence. Some of the sidelined capital (who missed the move) will definitely start getting itchy too—just keep watching and keep replaying/duplicating the charts. If you, as a “new ice-fan,” don’t understand it, then check the expectation-gap deep-dive post released during the holiday. You need to watch this post repeatedly. Usually, one or two times you won’t get it. And inside it contains the market’s wealth code!

4. Tomorrow’s Trading Plan
For reference only; not investment advice!
Position handling: JinYao Pharmaceutical
Opening expectation: around +2. About the amount—must reach 100 million to hold the position. If it doesn’t meet that, be cautious about holding. If it can’t go limit-up at the end, consider taking profit!
New watchlist: Huiyuan Communications, Cuiwei Shares
The operation logic for these two is the outer-cut approach. Your participation point must be when JinYao can’t manage to successfully re-close the board. The medical sector is in a big divergence—then you look at whether these two have follow-through/acceptance. You don’t necessarily need to open a position; you must wait for a definite buy point. During the day, vita will also share the strength/weakness. If JinYao upgrades (to the next stage), then you’ll just observe—wait for the later divergence before considering the long-leg (big extension) expectation!
(Note: I use the dragon-chasing/dragon-long method. I don’t have the habit of splitting into multiple tranches. All entries are full c.)

5. Thinking Questions (Yesterday’s deep-dive question)
Among the outer-cut cores, who do you like more? The reason is…!
No fixed answer—think actively and then reply!
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I hope friends who recognize me can please like and cheer for me. Support the recap post so the article’s numbers look good and attract more followers to pay attention. That’s the motivation for me to keep updating! It’s also the motivation for me to share my live trading experience! After 10,000 fans, I’ll apply to do a live stream. From my perspective, where I can see the short-term trading rules from an “observer/god’s-eye view,” everyone can become a short-term trading expert!**
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