[Red envelope]7.2: How does the first quantitative method identify Sanrui Intelligence, and how did it deduce the style switch on Wednesday?

Preface: "Friday 21:00 Live, Quantitative Arbitrage Three Techniques, Core Combat Methods of the Era, Babysitter-Level Teaching" [Taoguba]

Today, let's see, do you understand why on Wednesday we aggressively dumped tech stocks and tried low-level switches? On Monday, the first quantitative technique identified Huagong Tech at the opening call auction; Tuesday identified DuofuDuo, JinhaiTong; Wednesday identified Tuosida; Thursday identified Sanrui Smart, N Huarun. This new era style of play needs no further words—the market is the best proof! Michelangelo is not bragging about how great he is, but here to tell everyone that there is an effective approach in the market to cope with the rotation of the quantitative era. The core of the quantitative arbitrage three techniques is not to show off skills, but to have a way to survive steadily in the current environment—that is the core.

Many friends say they like confirmation on the board. Folks, I'm not saying this, but think back to the stocks Michelangelo identified—did they need board confirmation? They were all observed mid-way. If the opening call auction met criteria, the opening market depth matched, and the market linkage synchronized with the index, we observed directly. There was no need for board confirmation for safety. In the current market, if you catch a main uptrend, it's okay—you can seal the board. But if it's not a main uptrend or during a pullback phase, once it explodes, it's a mess. The essence of the quantitative arbitrage three techniques is to see the safety coefficient within the day, give room within the day, and handle it safely the next day. Not like board confirmation, where if a pullback occurs the next day, honestly, in this era, you might not even get a premium.

For example, yesterday's Tuosida—it was confirmed within the opening call auction + 2 minutes of market open. If you played the board, today you wouldn't even see a premium, let alone hold a position. Why does Michelangelo dare to keep observing? Observing mid-way on Wednesday, even if there was no room on Thursday, it still didn't hit the stop-loss line of the market, so we dared to see its bottom card. That is the best model in the current environment. On the poker table, everyone uses profits to see the bottom card, but you like board confirmation, using your underwear to see the bottom card—that's a completely different psychological state.

Also about the index. In yesterday's pre-market thinking, I specifically analyzed this 30-minute K-line chart. It's already obvious here—technically forming a triangle consolidation. Why is Michelangelo getting more and more accurate in index projections? My research on the index over the past two years is no postgraduate exam effort—it's life-or-death research. In this era, if you don't understand the index, you have no rhythm at all, and you can't control your position size! Think back—today how the market moved, I don't need to say it. The market has given the answer. And I didn't just YY the result, nor rely on subjective experience. It was all deduced through a comprehensive system of technicals, policy, news, cycles, etc. Every conclusion is grounded in reason—more objective than writing a thesis in student days.

The structure of the 30-minute K below is a consolidation structure. With this sell-off on Wednesday, the market actually has room for a rebound again. But the amplitude will shrink until it reaches a balance point and enters a narrow range consolidation. We've always said the meaning of consolidation: when it drops, you dare to buy; when it rises, you dare to sell. That's the meaning of consolidation.

Again, many people are unconvinced, afraid to buy the dip, only willing to do right-side chasing. If it were a divergence in an uptrend, that's fine—like 3.24-5.14, no problem. In an uptrend, any weak-to-strong after divergence is a right-side chasing entry. But in chaotic consolidation, if you dare not buy the dip and only do right-side, it will be very painful. Because consolidation has another characteristic: after a stop-fall, when it pulls up, it might pull up intraday and continue the next day. Or it might pull up intraday then fade. If you chase and it fades, you get caught on both sides.

Take today's market as an example. If you didn't dare to buy tech around -2%, are you going to chase after it stops falling tomorrow? In a T+1 market, initiative is quite important. Of course, there is also a possibility of failure—like a crash on Friday. This can't be said to never happen, but relatively, the probability is small. From a safety ratio perspective, taking a little left-side attention today is more prudent. Even if that small-probability event of consecutive crashes happens, the positions bought low today will have manageable drawdown tomorrow! This is the rhythm of offense and defense. This week, the rhythm has been maxed out. The market gave the best answer, and our folks witnessed this rotation of rhythm firsthand!

Another important point on Wednesday was the style switch. You can look at several core stocks Michelangelo focused on. In the first half of the week, they were all tech stocks, but by Wednesday, they were basically gone. What happened in the second half of the week? Switching to low-level robots—all low-level cuts. Of course, you might not get it right on the first try; there's no such thing as getting it right immediately in a chaotic period. But at this time, you must try. If you don't try, the next day you'll be chasing highs. Compared to that, Michelangelo prefers trying in the initial burst moment. As long as you control the position size and lock the defense line, how much room the market gives in the future depends on what the market delivers.

There's another knowledge point here: when trying, position size must also be controlled. You can't go all-in when trying—that won't work. The market's rhythm has patterns. Everyone's offense and defense are closely related to position size, which also needs to be managed. Even for the same observed stock, different people may get different value from it.

Regarding style switching, this is the fifth time we've said it. When AI peaks, the market may cut low, and the market style may switch. Why dare to assert this action will happen here? Because micro-cap stocks have stopped falling here and started seeing capital inflows! How many folks noticed this detail? Of course, the first rebound of micro-cap stocks here has ended; there may be more later, but Friday's micro-cap stocks are not the end point—rather, it's large-cap stocks stopping their fall and rebounding. If you don't grasp this style well, your rhythm will be wrong and you'll step wrongly, triggering a chain of missteps! Do you know why today we gambled on Jin'an Guoji ? Besides being a node dragon, it is also a representative of large-cap stocks. Whether large-cap stocks perform also depends on its face. Don't look at so many large-cap stocks limit down today. These institutional-style stocks, without policy or other external negative factors, won't go into an A-sharp decline like emotional stocks. Because an A-sharp decline means institutions can't offload their positions, and it can cause a stampede. So they'll decline in an oscillating manner. When the decline gets sharp, there will be opportunities for a rebound—that's also the logic of gambling. It may not be entirely correct, but the probability is relatively high. Everyone needs to do things with high probability!

In addition, the framework of "Michele's Nine Dragon Technique" is set up. As promised, the "Nine Dragon Technique" will be divided into chapters, updated weekly. Everyone remember to check and study! Michelangelo's entire life's learnings from stock trading, all dedicated to you all! After you finish studying, you'll understand what the techniques and patterns in this market are all about. Whether you can form a trading system depends on you!

Everyone, look forward to it! Starting in July, each week we will gradually break down every detail of the "Nine Dragon Technique" for you! If "Yang Family's Mental Method" is a mental method, hopefully, after Michelangelo publishes the "Nine Dragon Technique" as chapters, it will be everyone's short-term trading technique manual!
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"Short-term dragon technique, who's the best? Look at Taoxian Michelangelo!" Writing posts is not easy. Please hit the like button, use 100 points and fuel tickets to prove your desire and respect for dry goods!**

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7.2: Index 1 yin engulfing 3 yang! Tech overall down under pressure, semiconductors are survivors, quantitative starts rotating at low levels, robots strongest among rotating themes
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I. Market**
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Market volume 3473.9 billion, shrinking 208.9 billion. 94 stocks limit up, 40 limit down. Small caps starting to repair, large caps beginning to catch up**

Technicals have not broken down yet. Still within uptrend. The yellow line below is the rising support level. If it breaks here, the uptrend may be destroyed. Before it's broken, it's probably okay. Don't forget, Changxin Storage's IPO at the end of July requires liquidity and a bull market environment. If the index directly breaks below 4000 and turns bearish, it goes against the will of the big players. When there is no technical breakdown, be bold when it drops, don't panic; don't be greedy when it rises.

Style is switching: large caps plummeting, micro caps slightly in the red. The market is still mainly small caps and emotional stocks. Among the 40 limit-down stocks, most are large caps, and they are all big declines. The market hasn't shown panic; today's sealing rate is higher than yesterday. However, we can also figure out one thing: when market sentiment is good, the quant's board pulling is really fierce, with a clear one-way effect. If not blocked, they could pull over 200 boards. With 3 trillion market, it's really good. Similarly, when they kill, it's also fierce, also one-way. Professor Liu Jipeng's suggestion is good: better to have some technical restrictions on quant, otherwise the long-short imbalance is too severe.

II. Sectors

From the theme perspective, at the opening call auction, influenced by external factors, it gapped down sharply. Risk-aversion sentiment rose, driving the medical sector to strengthen and ferment. The low-level robot sector stabilized first, gradually raising its bottom range. Micro caps also showed strong resilience against decline. In early trading, the semiconductor sector started a repair movement. At the same time, AI applications, rare earths, pork, and other low-level themes rotated in bursts. Sector rotation is extremely fast and the switching is intense.

In the afternoon, Jiang Huazhong sealed the board, which was expected to deepen the semiconductor repair and boost market sentiment. But the major index suddenly plunged at a key node, moving weakly like a sluice gate opening. Dragged by the index, semiconductors, CPO, and the strong robot sector all surged and fell back. Funds within the market killed each other, leading to an extremely divergent weak market.

Robots

2 boards: Fulaixin Materials, Fuchun Dyeing
1 board: Tianyu Digital Entertainment, Fenglong Shares, Riying Electronics, Great Wall Technology, Tieliu Shares, Yayun Shares, Yingfeng Shares, Xinjie Electric, Jack Technology, Mould Technology, Aidi Precision, Mingke Precision, Tianchuang Fashion, Zhongzhong Technology, Zhejiang Dingli, Seven Wolves, Lingyun Shares, Hongchang Technology, Zhaofeng Shares, Yishi Precision

The sector's pressure resistance is okay, but the core theme has abandoned leading position premiums for two consecutive days. On Tuesday, Chengdu Road and Bridge; on Wednesday, Eston—both originally had strong acceleration expectations, but both broke the board and trended sideways instead of continuing on a board streak. Combined with the recent persistent strength of micro caps, the robot sector is likely waiting for the semiconductor sector to completely clear emotional sentiment. Only then can micro-cap robot targets be launched, making it easier to form two-way resonance between individual stocks and the sector, increasing certainty for the rally.

The current market is already clear: funds are not doing high-level position relay in the short term. The mainstream play has switched to low-level short-term trading. Avoid stubbornly fighting high-level position targets; keep your thinking flexible and your rhythm agile.

Semiconductors

3 boards: XianDao Mechatronics
2 boards: Zhengguang Shares, Heyuan Gas, Yawei Shares
1 board: Jinshi Resources, Bin Hua Shares, Yangzi New Materials, Ganhua Chemical, Qipai Technology

Internal divergence within the sector continues to intensify. Market movement is heavily influenced by US stock trends. At this stage, the board-linked moves in the market are more about capital creating an atmosphere for distribution, with weak sustainability of speculation. However, the semiconductor sector's board-linked moves are generally weak and lack rhythm, with clear internal differentiation. Material side tracks, backed by price hike catalysts, performed relatively solidly, especially the fluorine chemical sector.

DuofuDuo actively broke its board, abandoning pure board speculation and switching to trending—this is the best current move. If the semiconductor sector undergoes a repair, the material side, with its catalyst support and higher capital recognition, will likely repair significantly faster than the equipment side, becoming the core vanguard for sector rebound.

Consumer Staples

2 boards: Yuehai Feed
1 board: Huanrui Century, Zuming Shares, Tianyu Biology, Longtou Shares, Shuifu Shares, Baiyang Shares

Second board feed feeds first board dragon, pig, sheep, fish. Legitimate consumer not moving—I'm honestly speechless.

Medical

4 boards: Hainan Haiyao
2 boards: Meinuohua, Yiming Medical
1 board: Shuangcheng Pharmaceutical, Shifen Jingfeng, Lianhua Chemical

All recognition is on Hainan Haiyao. It broke through Hai Xin's suppression in height, but the first board fermentation didn't meet expectations. The index crashes and you don't take advantage of the chaos—are you waiting for tech to rebound to ferment? However, the Hainan sector got some fermentation, possibly trying to lead the Fujian sector. Watch for resonance on the intraday chart tomorrow.

AI Hardware

1 board: Xingye Technology, Faersheng, Deguan New Materials, Yellow River Whirlwind

More of a hugging characteristic. If tech returns, it could be the theme vanguard—needs index coordination.

AI Software/Computing related

1 board: Huasheng Shares, Tongli Tianqi, Shengyang Shares, Ningxia Building Materials, Tiandi Online, Diao Shui Hua, Fushi Holdings

Liton limit down, Gravity Board exploded. Also need index coordination to strengthen. Treat as rotation.

Small Metals

1 board: Beijing Lier, Xilong Scientific, Xianglu Tungsten, Chifeng Gold, Zhaojin Gold, Pengxin Resources

AI metals, hedging computing swinging both ways. Theoretically higher priority than consumer, but also trending.

Chemicals

1 board: Youfu Shares, Lier Chemical, Yonghe Shares

Hedging rotation, no positions made—skip.

Summary: The current market is in a high-level pullback, low-level rotation oscillation weak cycle, with overall sentiment extremely divergent and unstable. Throughout the day, sectors rotated quickly with poor persistence. The main index plunged suddenly in the afternoon, triggering a capital stampede. Most themes surged then fell back, with funds killing each other. Money has completely abandoned high-level board relay; the mainstream model has shifted to low-level short-term trading. The core market focuses are the medical sector's height breakthrough, the low-level robot sector's resilience, and semiconductor materials outperforming equipment. Tomorrow, focus on Hainan Haiyao's intraday strength and its resonance with Hainan and Fujian sector sentiment, while tracking the semiconductor repair rhythm. Market risk appetite is extremely low; avoid stubbornly fighting high-level targets; be flexible in controlling position and follow low-level rotation.

III. Core Market Disassembly

Today the market opened at -1.42%. As mentioned in the thinking, we need to defend. This defensive action, from yesterday's US and this morning's Korea/Japan, shows what we need to do. So at the open, we must observe where funds will go.

At the opening call auction, quant identified two: N Huarun and Sanrui Smart, but we needed to see the open. Yidian Tianxia and Blue Cursor opened relatively well, but if the index falls today, AI hardware and AI software cannot be watched. So only after the open could we see.

Next, the market gave the best answer. At the open, what did it do? First killed tech, then the market made a long move into robots. Do you know why Sanrui Smart couldn't be observed immediately? Because we weren't sure if the index would have a second dip here. After watching the morning's index bottoming without issues, and quant laying off low-level robot stocks, we could observe Sanrui XX.

Honestly, robots are really strong, and it's not just for one day. Robots have been strong for 3 days now: 26 limit-up stocks on Tuesday, 21 on Wednesday, 22 on Thursday.

But there is no leader. The robot play is more of a quantitative arbitrage—change the batch of limit-up stocks every day, cash out the next day, change another batch to pull limit ups. There are no leaders, central troops, or board-linked formations. Chengdu Road, Eston—these positions have no capital following. That reveals the robot playstyle.

Why did yesterday's quantitative arbitrage first technique identify Tuosida? Why today identify Sanrui XX? Isn't it just because we follow the quant capital's arbitrage every day to make it work! At this point, everyone understands how well the "quantitative arbitrage three techniques" fit the current market era!

IV. Tomorrow's Thinking

Index: Expect a stop-fall and rebound tomorrow, but the rebound strength needs to be judged on the fly. Strong rebound = strong attention; weak rebound = weak attention.

Cycle: The first cycle of autumn is brewing in chaos. Watch what theme and risk preference start this cycle.

Node: Looking forward to a new node.

Risk Preference: Trending stocks primarily.

V. Dry Goods Collection

[Red envelope] Enlightenment after two bankruptcies: Pure leader player

https://www.tgb.cn/a/2g0X43SSedy

[Red envelope] 6.22: Dry goods sharing: How to trade in the pullback period

https://www.tgb.cn/a/2j3U7MfS7BO

2025.5.12 Live: Quantitative play upgraded version

https://www.tgb.cn/a/2hZVzpSA7za

[Red envelope] 3.23 Weekly roundup: Position management dry goods sharing

https://www.tgb.cn/a/2gDeYkw8CuP

[Red envelope] 9.5 Live: Short-term monitoring - Key skills

https://www.tgb.cn/a/2l69xxRM7mZ

[Red envelope] 9.12 Live: Short-term review - Key skills

https://www.tgb.cn/a/2lhLwDHm7jd

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