3800 points of offense, 4200 points of defense!
Both a sharp spear and the toughest shield

The ones who hit the rhythm are the main force; understanding the market makes you the leader.
Since the index fell to 3,800 points on March 23, I warned everyone that 3,800 points wouldn’t break, and by May 11, when the index rose to 4,200 points, I told everyone that short-term gains were limited.
During that time, all my articles shared how to teach everyone to find the turning points in the market, and the trading concepts and analysis systems are replicable.
These contents are worth at least over a million, and if each cycle of main trend can earn 20%—30%, over three years, the person you admire will only be yourself.
Now the turning point is right in front of us.
Under market divergence, how should we grasp the main trend and risk control strategies?
During this period, everyone witnessed the sharpest spear; in the next period, do you want to witness the most resilient shield?
The decision-making power is in your hands.
If you want to share the entire thinking process every day, be active and enthusiastic—like, praise, and tip generously!!! [Taogu Ba]

Today, at 9:18 during the bidding, I told everyone in the comments that today’s market was likely to realize gains, and as expected, the market realized gains as it approached.
The number of stocks rising was only 1,200, while the number falling was as high as 3,800.
Why do I have this judgment? Let me clarify!!!

Yesterday, my first consideration was volume.
The volume in the market reached a peak, experiencing over a month of rally, and those who wanted to enter the market had already done so.
Yesterday, holders of stocks were excited, and those holding positions were excited.
First, for stockholders, those who could enter the game had already been heavily invested or fully invested for over a month, with no extra chips left.
As for those still holding or trading other sectors, what are they if not rookies???
The tech main line has risen for over a month, and those still thinking about switching based on divergence are thinking with a financial consumer mindset.
This group of people, every time they enter, is likely the market starting to enter a correction phase.
So my overall idea yesterday was to do subtraction.

Returning to today’s market, after the index volume surged past the new high yesterday, market sentiment was quite exuberant.
Normally, if the market wants to continue bullish, a pullback would attract funds, and there wouldn’t be a sharp decline without funds pulling back.
Instead, only after a significant drop would funds start to bottom fish.

From these phenomena, it appears the market hasn’t fallen enough, and funds are reluctant to enter.
Funds no longer want to keep pushing high, so the market has actually entered a consolidation phase.
Today, the market is overall divided; theoretically, tomorrow will see some correction.
Everyone wants to know if the opening is a good entry point???
I think not.
If today’s market is volume-based profit-taking, then profit-taking has already occurred, and if the divergence continues after tomorrow’s opening, funds will likely enter.
Looking at today, although profit-taking has started, it’s clear that there was no volume-based realization.
There are still a batch of stockholding funds in the market, and their idea is simple: they are watching how much the market can recover tomorrow.
As long as there’s no strong recovery tomorrow, it’s likely to rebound back up.
Because I believe that those who want to enter the game can do so when the market drops significantly today.
Many stocks are basically at their intraday lows, and those who lack this awareness, from a timing perspective, should not enter during the open with a quick recovery.

After discussing tomorrow’s market rhythm, let’s talk about the subsequent entry rhythm.
The market’s bell needs to be rung by the bell-ringer.
Where is the market’s bell now?
The illusion of 4200 points—yesterday, the index finally broke through 4200 points with a gap-up volume.
Do you think it will immediately fall back?
According to my view, it’s unlikely to fall back immediately.
As long as it doesn’t break below 4200 points, funds will continue to gamble on recovery.
So if the market continues to fall or opens lower tomorrow, breaking below 4200 points is a good entry point.
Whether it can rally intraday or not, there will still be opportunities to recover above 4200 later.

The above explains the market rhythm clearly.
The market is entering the late stage of the trend.
First, everyone needs to learn to reduce positions.
To do well in trading, many think that win rate is the most important, but it’s not.
Making big money in a trend depends not only on the win rate of judgment but also heavily on position sizing.
I’ve been telling everyone to focus on medium to high attention stocks, waiting for their big bullish candles each week.
Yesterday, new ideas like Changdian Technology and Changfei Optical Fiber showed big bullish candles again.
In the coming period, although the trend isn’t over, it’s entering a tough consolidation phase.
Everyone needs to pay attention to their positions; protecting profits is also a skill.

What should we do during the tough consolidation phase?

1. Technology stocks are not finished; today’s defensive stocks are still mainly in the tech sector.
   Based on the level of fund involvement, a retreat isn’t imminent.
   But the most obvious thing is that many storage chip stocks are entering high-low switching.
   In the upcoming market, tech stocks can follow the rhythm to find low-position strong stocks or wait for high-position correction to the 10-day moving average for recovery.
   (Here I emphasize: don’t chase the rebound with acceleration.
   Remember the extreme negative feedback in Hige Communication during the commercial aerospace surge? That should be vivid in everyone’s memory!!!)

2. Sector rotation is expected, but overall it’s hard to grasp.
   Mainly two directions:
   New energy lithium mines have already fallen to their logical bottom, as their future outlook remains high, and a deep fall could trigger a recovery.
   Commercial aerospace is about betting on subsequent news developments.
   In the near future, various news stimuli will trigger movements in this sector.

3. The preference for profit-making effects switches.
   Generally, when the market starts to get tough, groupings tend to switch.
   But usually, this happens after a trend causes losses.
   Today, stocks like Golden Mantis and Hang Electric have already shown some sparks; future focus can be on the groups forming the core.

Finally, a prediction:
Be both the sharp spear in the market and the most resilient shield.
Starting from June, ultra-short-term trends will rise.
Everyone needs to prepare early, adapt in advance, and allow some negative feedback during the adaptation process.
Summarize more experience, and in the next trend, you might be the most handsome in the market!!!

I never write those seemingly profound but actually useless deep analyses, nor do I do the old-fashioned analysis of limit-up teams, sentiment cycles, or leader logic.
In the era of quantification, these are subjective guesses and post-hoc analyses, with no practical value besides self-satisfaction.
The market isn’t short of stories, analysis, or fancy writing; what’s missing are truly implementable solutions that can improve your account’s curve.
I don’t do emotional output or metaphysical predictions—only one thing: hit the market rhythm accurately and find response strategies directly.
No matter how fancy the words, if you can’t avoid losses and earn more, it’s all in vain.
My content is only for two types of people:
One, traders who are clear-minded and don’t believe in old routines;
Two, those who want to trade easily and happily.
In the quant era, it’s not about who can tell better stories but who understands quantification and rhythm better.
Research quant methods, identify quant behaviors, synchronize with main forces—here in Taogu Ba, I have enough confidence to aim for the top.
Less self-indulgence, more practical action; less prediction, more response.
Following and adapting are the true basic skills of a master today.
Facts speak louder than words; your account won’t lie!!!

Thanks to the 119 benefactors who tipped yesterday:
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