Hexun Information Feng Lushun: Power Grid Equipment vs Power Next Steps

On May 12th, Feng Lushun from Hexun Information stated, we all know that the limit of computing power is electricity, and the limit of electricity is nuclear power, so today these two major directions also experienced a significant rise. Many friends asked whether we can continue to push computing power higher? Let’s look at it with a method: any sector’s first step to a big rally is to satisfy a major cycle pullback. Look carefully yourself, the power grid equipment just pulled back to the May line this month, which indicates the completion of a major cycle pullback. The small cycle 5-day moving average crosses above the 10-day moving average, MACD turns red and starts to turn upward, with the histogram shortening initially and then lengthening. The goal of this upward reversal is to challenge previous highs. Once the challenge succeeds, it will continue to reach new highs, so this direction remains bullish.

Next, looking at electricity, the limit of computing power is electricity. Recently, electricity stocks hit new highs but MACD did not, forming a bearish divergence. After the divergence, a correction occurred. After the correction, the major cycle pullback was also satisfied, falling to the May line. The small cycle 5-day moving average crosses above the 10-day moving average, MACD shows positive momentum, and it begins to challenge previous highs again. Therefore, the electricity sector must break through this previous high.

Looking at the trend line indicator, in the last wave of the market, the trend line broke above 50, but the value was too high and was adjusted downward. Now, the value needs to rise again to break through the green line. After reaching a new high, only then will the trend line bend and adjust. So, the adjustment in the electricity sector is also an opportunity for us.