5.12 When will technology stocks peak?

When Will Tech Stocks Peak? [Taoguaba]
Tech stocks worldwide are performing their final frenzy, and what many people care most about is when the short-term top signal will appear.
Because the market can’t keep pushing higher indefinitely.
Personal opinion:

1. If the trading volume for five consecutive days exceeds 3 trillion yuan upward, it can almost be certain that the peak day will see a volume approaching 4 trillion yuan. Therefore, approaching 4 trillion is a critical threshold for trading volume; once volume nears 4 trillion, it’s basically a short-term top.
2. Sharp cooling down: last year’s strong rally was followed by a sharp cooling, causing the market to start consolidating sideways. This year’s relentless push higher will likely also cool down sharply. Once a cooling signal appears, pay attention—there’s a high probability that a top signal will emerge within a few days. Keep an eye on policy news.
3. High-level stagnation begins to show, with funds rotating to lift low-position large-cap stocks for a rebound, especially low-position brokerages, which are basically short-term top signals. Because large-cap stocks at low levels attract active funds, the tech sector will face liquidity crises, leading to significant pullbacks.
   These three signals, combined with a very obvious loss-making effect in early trading on a certain day, and a batch of strong stocks dropping sharply with large negative candles, indicate a short-term top.
   And this signal might be the unreliable visit to China on Wednesday or Thursday. But this only refers to a short-term top. Also consider the US stock market overnight.
   $1
   Market Analysis
   Morning Opening Auction
   Online and offline, 1 billion yuan straight up, equity transfer
   Ke Chuan Technology, 800 million yuan straight up, Tu Wenbin’s takeover, guiding CPO, big tech
   Hanbang High-Tech, 800 million yuan straight up, guiding computing power
   Hongban Technology, 360 million yuan straight up, PCB, guiding PCB, big tech

Big Tech:
US stocks’ optical communication explodes, tech continues to party.
Relatively speaking, mid-to-low positions are outperforming high positions in rebound.
Of course, the old stocks like Yi Zhongtian are also rising, with Zhongji Xuchuang hitting new highs again. But stocks with less room to grow aren’t as strong.
Many funds are still focusing on value and structural opportunities.
Within tech, CPU recovery, CPO continued strength, storage adjustments.
We are still in the big trend cycle of optical technology.
Even the recently very strong semiconductors are still in a rebound phase.
Cannot yet interpret this as a departure from optical tech.
The market in the morning has basically fermented, and as indices decline, some divergence begins to appear.
For example, China Great Wall breaking the limit, Hongban Technology breaking the limit, both show divergence.
But as long as market volume remains sufficient, large divergence is unlikely.
It’s just a matter of some stocks having risen too much, taking a break, and others with less rise catching up.
So as long as the trend stocks’ charts are intact, divergence is just an entry point to wait for rotation.
Until one day, core large-cap stocks show a big negative feedback.
Or trading volume surges excessively, reaching an overly excited level—that could be the top.
Sentiment stocks are just looking at the straight-up guide or high levels to trade.

Newly Listed Stocks:
Are the best recent profit-making sector.
From Beijing Stock Exchange, newly listed stocks are fermenting toward the Shanghai and Shenzhen main boards.
Hongban’s straight-up is essentially an acceleration of the rebound of newly listed stocks.
Don’t ignore the existence of newly listed stocks and Beijing Stock Exchange just because you didn’t participate.
Participation in newly listed stocks and Beijing Stock Exchange requires high skill.
Besides deep understanding of individual stocks’ fundamentals, you also need practical experience with new stocks.
20CM, 30CM trading, is different from 10CM limit-up; a 10CM limit-up itself is a signal, but if you chase at open with 20CM or 30CM, what’s your basis?
If you can figure this out, you can boldly chase and buy.
For ordinary investors, just observe.
Lacking ability, easy to be hit back—30CM backlash…

Power Sector:
Can be said that Datang Power alone led the power sector.
The power sector is a safe-haven sector. The market rose for five consecutive days, accumulating profit-taking, so a correction is expected.
Near the unreliable visit to China, some funds’ gains are realized, and funds flow out to safe-haven power stocks.
But the power sector only performed in the morning; in the afternoon, funds flowed back into big tech.
Big tech trends and Trump’s visit to China will influence the sector’s movement.

Commercial Aerospace, Robotics:
Classic rotation themes, and convection themes in tech.
As indices rise, these rotation themes will bounce around;
As indices adjust, these sectors often are just one-day wonders—if tech remains strong, these non-mainstream sectors can disappear just as quickly;
And when indices decline, these non-mainstream sectors are among the first to end.

Sentiment Anchors: Datang Power, Tongding Interconnection, Dongshan Precision

Profit Effect & Market Style
Newly Listed: Representative stocks: Hongshida, Hongban Shares
Continuous Board Battle (Weak to Strong): Low P/E, low price, weak to strong, representative stock: Datang Power
Trend Institutional Clusters: Big tech combined with industry growth. Representative stocks: Dongshan Precision, Yunnan Germanium, Tongding Interconnection.

Core Stocks with Continuous Boards
5 Boards, Datang Power
Announcement of good news, the first stock in computing power collaboration, while the entire market is watching big tech, Datang Power in the power sector emerged. Valued by computing power, it’s indeed undervalued—PE only 11.
2 boards, major decline, 3 boards, high open—buying points.
4 Boards, Tongding Interconnection
Logical reasoning: the company cooperates with Corning USA, replacing Changfei Fiber’s position, rebound to 4 boards, heavily supported by Corning’s nightly US stock performance, likely to break the limit and trend later, highly tied to US stocks.
3 Boards, Kangxin New Material
Sentiment stock, domestic CPU. Not easy to follow up at 4 boards.

Today’s Knowledge Point:
If a sector or stock is predicted to be a selling point that day, not a buying point, then don’t buy it—even if it offers excellent value. For example, yesterday and today’s CPUs. If you’ve already decided it’s a selling point that day, don’t buy.

Tomorrow’s Strategy:
As Trump’s visit to China approaches, some “smart funds” will take profits early over these two days. After several days of continuous rise, some profit-taking is normal, but tech’s continuation remains decent.
Today’s market is still testing the logic mentioned earlier; currently, the focus is on US stock market reflection.
Last night, US stocks like Corning and Lum rose well, with optical communication performing better than other sectors.
As long as you hold onto the front lines of tech, even with brief adjustments, within a couple of days, stocks can rebound or hit new highs—like Semiconductors’ Cambrian, Great Wall, Zhongji in CPO, etc.
The current market involves high-positioned groupings, attempts at high-low cuts, and hedging for risk.
But what’s certain is that even if the index enters consolidation, tech will still have structural opportunities.
How to operate at this stage depends on your initial position and profit cushion:
If you have an early position and a thick profit cushion, continue holding in the tech front line as long as the trend isn’t broken.
If you lack an early position or profit cushion, don’t recklessly chase high; look for low-position opportunities or wait for big divergences.

At the same time, prepare for two-handed strategies—be wary of a major tech correction.
When it begins, how deep it will be, and when it ends, can only be seen step by step.

Recap will shift from daily updates to irregular updates; trading ideas for the day and next day may no longer be written.
The above is just personal investment thinking and does not constitute investment advice. Do not follow stocks blindly. If comments involve your holdings and cause discomfort, please unfollow!
The most important thing in stock trading is to be happy every day! — Ni Gula Si, Niu De Fa