(Lonely) Dry Goods Series [Part 1]: The Intervention Model for Short-term Traders in the Era of Institutional Pricing Trends! Is it valuable? You decide!

Taking advantage of the weekend to share some practical model insights. These are patterns that have maintained a solid win rate through the bear and bull markets over the years of going it alone. Detailed breakdown below.[Taoguba]

First, you need an overall understanding. Our market is built from an endless cycle of overlapping periods. The most familiar sentiment cycle for short-term traders is just one of the smallest components. Above that, there are also style cycles, covering main board, 20cm, 30cm, convertible bonds, and other styles. So sometimes you wonder why the ChiNext is so strong while the main board is quiet, or why buying ChiNext for arbitrage when the main board is hot doesn’t make money.

Let me expand a bit here. When is this kind of elasticity in ChiNext most effective? At the early stage of a booming market, when a theme just starts to explode and market capital is extremely hungry! Main board traders feel it’s too slow and want to quickly establish heights and capture gains. A recent example is the AI application rally in January. I was fortunate to participate. Early on, I identified the most sensitive point of capital, buying on dips and halfway into Zhixin New Materials, securing a doubled return:

Above is the intraday chart on the entry day; below is the operation over the entire cycle:

From the perspective of January 6, you’ll notice that there were as many as 10 consecutive 20cm two-board stocks!

This is a sign of an extremely hot market at any time. The reason is that on the first day back after the New Year, the market index and sentiment themes exploded in resonance. The mid-cap stock Blue Cursor had already surged before the New Year, and after the holiday, the whole market strengthened directly. This indicates that the resonance point here is a major node. So how do you find the strongest among them? You can see many medical two-board stocks were due to brain-computer interface positive news, but the market’s logic for this wave is mainly AI applications. After screening, you’ll find a stock with no recognition stood out: Zhixin New Materials. Its story was excellently told. At that time, AI applications were still hard to generate earnings or blockbusters, and the AI4S concept perfectly aligned with the market’s infinite imagination for new branches of AI application development, especially with CCTV endorsement. From a short-term energy perspective, this echelon had large single-character guidance, making it a must-fight battleground with high echelon strength. So when Zhixin opened with a strong竞价 and strong承接, you could directly buy on dips. This is buying point one.
By January 8, because the brain-computer interface two-board stocks on the 7th showed severe negative feedback without timely repair, sentiment that day wasn’t very strong. The popular sector stock Yinlimedia opened like this:

So as the accelerated high-signal stock in AI applications, I slightly reduced on the board. The next day, applications continued to flow back, and I held the C position all the way until suspension. After suspension, you can see that I not only didn’t sell a share but actually added positions at the limit down. It was extremely weak that day. Where did this confidence come from? This leads to another important experience of mine: As long as the stock’s status is sufficient, the theme hasn’t ended, and the sentiment capital will definitely come to rescue when a stock with high sentiment is abruptly halted by regulation, whether through sudden monitoring or suspension. If you don’t understand this single case, let me give more examples:

1. Baoding Technology

On June 9, after triggering a price movement, it opened at limit down the next day, then fell another limit down due to the overall tech sector’s major divergence. Then during the regulatory period, it hit three consecutive boards to new highs. The driving force was the copper foil sector’s high prosperity, the inertia of market sentiment heat, and the unfinished tech theme.
2. Datang Power Generation

On May 19, it failed to suppress price movement and got nuked, stabilized after two limit downs, then underwent a second wave when Liao Neng and others collectively expressed support.

That’s enough examples. Although this article’s main content isn’t about this pattern, attentive friends can already extract a profitable model effective in both institutional and emotional markets. Let me summarize a few points:
1. Stock selection: Pay attention to core stocks at resonance nodes. Choose stocks with core status in the sector; otherwise, this model will only make you suffer an A-kill.
2. Timing: The sector trends well, only experiencing major divergence without continuous loss-making effects, or short-term sentiment exhausts and stabilizes. The vehicle is still likely to be chosen, meaning the logic of the stock and theme hasn’t completed. This is essentially the extreme use of sentiment cycles: buy at the freezing point, sell at consensus.
3. Cost-effective buying point: The selected core stock’s dip-buying point requires market stabilization, with negative feedback from anchor stocks basically disappearing, and the stock shows clear承接.
4. Beijing Stock Exchange/New stocks: Generally emerge when profit-making effects spill over or when the mainstream main line is sluggish. They come fast and go fast.

Above I discussed style cycles divided by main board and elasticity. By pricing power, styles can be divided into institutional and sentiment capital. Of course, these two now often mix, especially under quantitative dominance, where institutional stocks have shown characteristics of emotional stocks. So they are now divided into trend and consecutive board styles. The consecutive board style has been sluggish for a very long time. The reason is that to do consecutive boards, you mostly need small-cap stocks that are easy to chain, while capacity consecutive boards require very strong sector emotional intensity and unavoidable leading status. Most importantly, look at market profit-making effects. Previously, Shengyang Energy could chain because there was residual profit-making effect from power speculation, combined with many short-term funds starting to shift to institutional trends. As more funds pour into trends, pure consecutive boards gradually decline.

So in this current trend market, is it really hard for short-term trades to intervene? Let me share a high-win-rate model: the break-board reversal model. This model sounds familiar—everyone knows reversal, right? But using it well isn’t easy. To achieve a high win rate, the first key is still timing. Take China Jushi, which I operated recently, as an example:

My first entry on dips was at the first break-board divergence node. Let me outline the prelude: On June 12, the market index had its first gap-up surge, which was a Friday. At that time, I held Hengtong Optoelectronics, hoping that technology had fallen enough and that Hengtong, as the core stock of the previous resonance node, could lead. But that day, technology plunged violently, while the metal sector resonated with the market. I followed the market and switched to non-ferrous metals. On June 15 (Monday), technology started a shrinking rebound. Since Friday’s performance disproved the logic of technology being anti-drop and leading, the shrinking repair on Monday shouldn’t be chased at the open. I chose to observe. Over the next few days, the index stabilized, and technology showed strong persistence, reversing the shadow of the previous decline. Electronic cloth, as the best trend branch in the market at that time—while optical fiber and copper foil were already at a high point of acceleration—was relatively low, with continuous catalysis in its logic. So it achieved the first buying point of the trend stock break-board reversal model: first divergence dip to the 5-day moving average, with good承接 and cost-effective dip buying.
The next day, it almost reversed to the limit up, so there was a second buying point. Since the previous day’s divergence was healthy with good承接, the next day should be a potential reversal day. Opening flat or near flat with quick large orders pulling up is a cost-effective dip-buying point. If you miss the open or worry about fakeouts, the strong承接 after the open’s initial surge and pullback is a buying point.
Third buying point: chasing the limit. If you miss the cost-effective dip-buying point at the open, you have to wait for certainty and chase the limit. On that day for Jushi, the tech sector overall attempted a repair at the open. Zhongji Innolight was in a deep drop then surged to repair and then plunged again, Fenghua also plunged. So Jushi could be dragged down, making it difficult to hit the limit on the surge. So I chose to sell at the inflection point, then later when it separated from other stocks and tech stabilized, I added back through确定性排队:

Chasing the limit is for strong stocks to capture the premium from the next day’s surge, regardless of size, generally within arbitrage.

Above I shared the capacity break-board reversal. Another type is smaller cap, more sentiment-driven break-board reversal, still mainly arbitrage, exit if it doesn’t board:

The image above is Aihua Group. At that time, passive components began to ferment. As a sector arbitrage stock, it was created by sentiment capital. It entered view after a two-board streak. The first red arrow is the first break-board reversal; the second arrow I entered for arbitrage and exited. There are many such stocks. At every node, a large number of these stocks appear. Diversified allocations for arbitrage accumulate to enough compound interest.

Alright, today I shared three core profit-making techniques: dragon confirmation at the early stage of an outbreak, dip-buying when external forces interrupt the leader, and multi-breakboard reversal arbitrage for trends. If you have questions, leave a comment. If you find it useful, like and tip to support. My sincere sharing aims to help brothers avoid detours.

Emphasize again: Timing is first in technique. In clearly ambiguous environments with large negative feedback, not buying avoids losses. These models are part of my core techniques in this market. I share them selflessly. I will sporadically take time to share more干货 in the future, and during the trading day, I will guide everyone to dissect the market! Pre-market thoughts, post-market review in one chain.