Hexun Information Hu Yunlong: The concern has arrived, what to do today

Last week, market hotspots continued to focus on the technology sector and kept strengthening, not only in A-shares but across global capital markets, which also showed a pattern of technology stocks leading the rally. At the same time, the market has also given rise to new cautious sentiments. Some institutions have conducted analysis based on historical data, focusing on the risk of the technology sector’s proportion in the weighted index. Referring to the historical patterns of the U.S. stock market, when the proportion of technology stocks exceeds 40%, the market often tends to enter a wide-range consolidation; historically, the weight of a single technology sector has once surpassed 60%, and the current market share is approaching a critical level. Rational concerns in the market are not a bad thing; instead, they reflect overall cautiousness among funds. Institutions warn of potential risks and sound an alarm for market participants: it is not advisable to be blindly optimistic or to chase gains when deploying in the technology sector, and one cannot be certain that the trend will continue to rise unilaterally. From the actual market trend, technology stocks have remained strong recently, indicating that the market has not yet formed a consensus divergence, and the overall rhythm of oscillating upward has not been broken. The core catalysts that could trigger a deep correction in the technology sector have not yet materialized. Based on multiple perspectives, two main types of signals could induce sector adjustments: one is the extreme upward fluctuation of key government bond yields, and the other is sudden major macroeconomic catalytic events. Currently, the external variables with influence are limited, with only international oil price fluctuations having a strong transmission effect. In the current market environment, it is advisable to maintain a balanced mindset: on one hand, stick to the main hot spots and grasp structural opportunities within the technology track; on the other hand, stay alert to risks, and if market signals turn, reduce positions promptly to avoid volatility. The market currently lacks other sustained hotspots, and capital clustering in technology remains the mainstream choice. For low-priced, unpopular sectors, long-term patient deployment is suitable. Market trends are always driven by sector rotation; a single track will not continue to strengthen unilaterally, and weak sectors will not be suppressed for long. The key is to adapt to the rotation cycle. Without enough holding discipline and patience, it’s better to wait and observe for clear opportunities rather than blindly deploying in unpopular directions. Looking solely at the overall rhythm of A-shares, the current oscillating upward trend remains good, and the biggest risk lies in short-term rapid surges and continuous short squeezes, which have not yet appeared. The overall operation strategy is to participate in structural opportunities in line with the trend while maintaining rational risk control; in terms of sector selection, priority should still be given to exploring subdivided opportunities within the technology sector.