[Red Envelope] 5.11 Review. The three major indices collectively hit recent highs, with incremental funds flooding in. How to grasp the rhythm amid high-level divergence?

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Today’s operation review:: All the actions below are simulated, for market review and learning only, not real trading guidance.

Short-term account:

Buy: Zhuolang Intelligent, focus on the board

Comment: Still returning to one-in-two to do arbitrage. Now it’s all institutional, risking catching a high rally. Zhuolang is an old stock with trend potential.

Trend account:

Buy: Hanjian Heshan, focus on moving averages, Red 2+ points

Comment: Underground pipelines in the six networks, also in the 155 plan, many projects recently underway here. Hanjian is a leading water supply pipe company, buy on opening pullback, there was some capital ignition today, but no follow-through, a pity to pull back. Still not convinced. Or the market’s heat is mainly on big institutional stocks.

Sell: Shengxin Lithium Energy, sell on surge, green one point; Meili Cloud, Red 3+ points

Holdings: Shenzhou Information, Red 3 points; Jinan International, cost line; Furong Technology, less than one point in red

No comments on previous labels.

Morning thoughts:

Most of the week’s here. How to do this part well? Now institutional stocks are rotating, today’s turn is Guang, others rest. Tomorrow’s turn is PCB, energy storage chips rest. For tech lines, we just follow overseas chain logic. Whoever peaks, I will realize profits and reduce positions. Then switch to other low dips for divergence. As long as the trend remains, I will interact back and forth. Even if there’s a correction, you’ve already secured your profit. Switching without missing the rotation. So big-cap funds should diversify positions. Spread out a bit, even if the mood of continuous rally can’t open high, it’s about guiding market funds to follow the trend. We should follow the flow, use positions effectively, buy low on divergence, and when the next rotation hits your target, just relax. Otherwise, chasing high after missing out is painful. Not the chase itself, but opening high and falling back in the afternoon, then opening lower the next day—most painful. So our mindset must shift. Focus on institutional stocks, rotate in and out, reduce positions at peaks. Now it’s about your ability to split positions well. Everyone has a chance to rotate. But you can’t buy everything. Early positions are more advantageous than late ones. Don’t switch tracks back and forth; just high and low in a few strong stocks.

4-in-5 Fuda today exceeded expectations. That’s industry chain solid effort. Reached 5 boards, capital really wants to push for volume to test, but nothing fermented, pure hard top. Advice: don’t be stubborn, otherwise divergence will be hard to resist. I mentioned before, Fuda keeps hitting limits, no cost performance, except for Datang’s weak-to-strong shift, others are very weak. Active ones like Daye and Bodi opened very poorly, even trying to fight for dominance during the session. Recognition is limited. Datang’s sector didn’t strengthen much, Fuda still suppresses. So my imagination is limited for now. Also, the current rally isn’t very strong, mostly institutional stocks rotating. High-level relay isn’t suitable now. We need an breakout player to break the strong institutional hold and lead the sentiment back. Otherwise, high-level relay will be hard to complete. Most of the first and second boards are quantitative, the cost-effectiveness of going from 2 to 3 isn’t as good as 1 to 2. Current relays are broad in width but low in height. So prioritize the cost-effective, actively doing 1-in-2, with upward space still imaginable.

Bid opening shows the least useful stocks, indicating funds still don’t recognize this sector, mainly driven by institutional tech stocks. Zhongtian Technology, for example, the top trending stocks are mostly retail camps. Good stocks rarely open gaps in the first two boards; if they do, it’s just to relay. Very few good stocks get in early with initial releases. So don’t believe too much in these. The hype costs some money, and high-level speculation is often just for dumping. If you buy on the limit, tomorrow’s premium is fine; if not, it’s a big loss.

Market review:

The three major indices opened high and moved higher all day. The Shanghai Composite broke through 4200 points early, closing at 4225.02, up 1.08%; Shenzhen Component Index was even stronger, up 2.16% to 15,899.30; ChiNext surged 3.50% to 3,928.97, hitting a near 11-year high since June 2015.

Today’s total turnover reached 3.54 trillion yuan, a significant increase of +490.3 billion yuan from the previous day, hitting a 4-month high, and for four consecutive days exceeding 3 trillion yuan. This is a very important signal—behind the massive volume is genuine new capital entering, not just self-trading of existing funds.

Short-term sector sentiment:

Currently at the transition from the old cycle to the new cycle, high-level sectors are loosening, and funds are searching for the next sector to support.

5-board: Fuda Alloy, Power Grid + Computing Power, exceeding expectations, strong capital support, tomorrow’s divergence is a question of who dares to be stubborn. If it can break through, it’s a good situation.

4-board: Datang Power Generation, Computing and Power Coordination, weak to strong with volume test. No support from behind, Fuda still suppresses. Imagination is limited.

3-board: Tongding Interconnection, Optical Migration, institutional dominance. Besides low dips, who dares to relay?

3-board: Taijing Technology, Optical Modules, hard to relay.

3-board: Shandong Boqian, PCB, buy bonds if you like.

3-board: Hongban Technology, PCB, red board, red board? Red market, red market?

3-board: Baoding Technology, PCB, trend stocks accelerating relays.

2-board: Junda Shares, Space Photovoltaic, dominant but not far.

2-board: Chengxing Shares, Chemical Industry, status established, imagination limited.

2-board: Daan Genes, Pharmaceuticals, recent news on viruses boosting defensive attributes. Afternoon surge still driven by risk-averse funds.

Semiconductor chip industry chain: today’s strongest main line

Memory chip sector surged with limit-ups, such as Puran and Tongyou Tech up 20%, Lanqi Tech and Jiangbolong up over 10%, many hitting record highs. Semiconductor equipment and materials also exploded, Changchuan Tech, China Shipbuilding Special Gas, Tiancheng Tech all up 20%, Changdian Tech hit a new high, approaching 100 billion market cap. Advanced packaging is also active.

Core stocks: Puran (storage chip leader), Changdian Tech (core asset in advanced packaging), Lanqi Tech (global leader in memory interface chips, hitting record high), Jiangbolong (storage module leader, benefiting from AI server storage demand explosion)

Fermentation logic: Institutions estimate AI server DRAM usage is 8 times that of traditional servers, NAND 3 times, demand growing exponentially. TrendForce revises 2026 Q1 DRAM contract prices up 90-95% quarter-over-quarter, NAND Flash up 55-60%, supply tightness may last until 2027. SK Hynix and Samsung hit record highs, SK Hynix’s market cap reaches $900 billion. SMIC’s 40.6 billion yuan acquisition approved, semiconductor capacity integration accelerates. The central bank’s tech innovation re-lending scale expanded to 1.2 trillion yuan, supporting AI and semiconductors.

Trading idea: Short-term high prices, beware of profit-taking pressure. Medium-term logic clear, buy dips to hold leading stocks. Focus on storage chips and advanced packaging.

AI computing power and CPO optical modules: continuing trend

Optical modules, PCBs, copper cables, and high-speed connectivity hardware all strengthen, Luxshare up 10% with a market cap over 160 billion, Tongding Interconnection 3 consecutive limit-ups, Cambridge Tech trending higher.

Core stocks: Luxshare (absolute leader in optical modules), Tongding Interconnection (flexible optical communication stock, now three limit-ups), Zhongji Xuchuang (popular, highest turnover)

Fermentation logic: AI large model competition intensifies, giants like ByteDance significantly increase AI infrastructure spending. CPO (co-packaged optical) tech becomes industry trend, order backlog full. Target optical connectivity capacity to increase tenfold, global fiber optic supply-demand gap about 6% by 2026.

Trading idea: Hardware stocks at high levels (CPO optical modules, semiconductor equipment) have completed main upward wave, short-term momentum wanes, beware of technical pullbacks. Funds are spreading into upstream and downstream of the industry chain, focus on low-priced optical communication materials and devices.

Green energy and energy storage synergy: policy-driven, risk-averse attributes

Electric power sector continues strong, Datang Power hits 4 consecutive limit-ups, Huaneng LiaoNeng 9 limit-ups in 18 days near historical high, Gansu Energy and Guiguan Power hit daily limits.

Core stocks: Huaneng LiaoNeng (18 days 9 limit-ups, market cap over 20 billion, core in energy-storage synergy), Datang Power (green power direct connection to computing facilities, currently 4 limit-ups)

Fermentation logic: On May 8, the National Energy Administration and four departments issued the “Action Plan for Promoting Bidirectional Empowerment of AI and Energy,” explicitly supporting green power direct connection to computing facilities. Peak summer electricity demand expected to tighten. China Datang’s 500k kW photovoltaic station in Zhongwei is operational, the first large-scale green power direct supply project for “computing and power synergy” is implemented.

Trading idea: Policy support is clear, power sector has both defensive and growth attributes. But stocks like Huaneng LiaoNeng have already surged significantly, watch for high-level risks. Focus on low-priced power equipment and energy storage stocks for rebound.

PCB and electronic materials: price increase logic

PCB sector remains active, Shandong Fiberglass 8 days 5 limit-ups, Hongban Technology 3 limit-ups, Baoding Technology 3 limit-ups, Han’s Laser and Guanghe Tech hit daily limits.

Fermentation logic: Electronic materials have raised prices four times since early this year, from 3.2 yuan/meter to 5.6 yuan/meter, a 75% increase. Many electronic fabricators are stock-tight, industry in supply-demand tightness. Shandong Fiberglass and others reported strong Q1 results.

Trading idea: Price increase logic in electronic materials still fermenting, but short-term gains are large. Consider low dips in other chemical new materials with room for price hikes.

Future market outlook:

Index level: Shanghai Index stabilizes above 4200, ChiNext breaks through 3900, both hit recent highs, trend has fully turned bullish. Profit effect is highly concentrated in tech growth main line, safe-haven sectors’ heat continues to decline.

Strategy direction: Tomorrow’s market and operation ideas: detailed in the morning thoughts.

Technical tips direct link↓↓↓↓↓↓↓↓↓↓↓↓↓

Weekend technical tips (V): If you don’t make money trading stocks, it’s not due to poor skills but because your model is messed up. Explaining short-term and trend trading logic clearly.

Weekend technical tips (IV): Trading survival: defense as the foundation, offense as the tool!

Weekend technical tips (III): Short-term can also be a steady water flow.

Weekend technical tips (II): How short-term traders can accurately review!

Weekend technical tips (I): The nine key factors for high/low board success rate.

Weekend dry goods sharing: Master the rules of auction bidding, distinguish between leading stocks and mid-tier rebounds, stay away from follow-the-crowd junk!

How to improve the win rate of board hits, how to operate the next day after encountering bad boards and volume surges?

Core strategy for swing trading

Only operate within recognized models

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