[Red Envelope] 2026.3.25 Review: Power Sector's Second Wave, Will Aerospace Return?

Like and support, continuous gains; ask questions and enjoy long-term benefits! Hello everyone, I am Wan Gu Zhang Qing. [Taogu Ba]

1. Price Competition Analysis

The stock market day begins with the opening auction. Today, I took a moment to calculate the conditions for electricity stocks to strengthen today. It requires a 2.5 billion order block and three one-word limit-ups. Today’s opening auction clearly showed electricity was below expectations, indicating a divergence at the open. However, I also pointed out that a variable for electricity stocks is Huadian Liaoning Energy. If it unexpectedly advances to the eighth limit-up, it will immediately lead the sector back, showcasing the influence of a leader.

The first stock in the auction was Mingpu Optoelectronics, a leader in optical communications, an area mainly driven by institutions. Institutions avoid continuous limit-ups, so I had little desire to follow this indicator. There was some fermentation later, but likely a one-day move. The second was Xineng Taishan, whose order block compared to yesterday’s sector fermentation was far below expectations, so it’s not a signal. The third was Aoruite, a new one-word limit-up, indicating a potential lead, with some fermentation afterward.

2. Continuous Limit-Up Tiers

Today’s number of consecutive limit-ups is several times higher than recent days. Notice how many second-limit-up stocks there are—that’s a resonance point with the index, worth paying close attention to.

Eighth limit-up:
Huadian Liaoning Energy, a sector leader in electricity, broke through Yunnan Energy Holdings’ high and did not fear its dip, now becoming the new dominant player in the sector. It added positions for two consecutive days, showing strong belief in the leadership.

Fourth limit-up:
Zhongli Group, involved in photovoltaic and mergers, also has electricity concepts but clearly not following that trend. Today, it pulled a exhausted limit-up, possibly anticipating Huadian Liaoning Energy’s break, preparing to shift from weak to strong. I think some funds might be overestimating this.

Third limit-up:
Zhejiang Xinneng, with electricity attributes, has survived mainly due to its resilience and riding on Huadian Liaoning Energy’s coattails.
Liaoning Energy, also electric, was pulled during Huadian’s sixth limit-up, but today opened weakly and was closed, causing me to exit.

Second limit-up:
Resonance stocks with rising index correlation need attention, but there are too many now. Focus on a few:
Xineng Taishan, electric attribute, one-word foundation, with subsequent limit-up and rotation. I will definitely buy, but not below five points.
Hunan Development, electric, slightly weaker than Xineng Taishan, unless it surpasses Xineng Taishan later, no need to watch.
Aoruite, optical electronics, with no big expectations, only notable for resonance with the index, but that’s common among second limit-ups.
Shaoneng Shares, electric, a rebound from a second limit-up. I bought it at the limit-up, made some profit, and sold. Now it’s rallying again, but I don’t pay much attention. Main rise with rebound is better than just rebound.
Energy-saving wind power, electric, a capacity stock, but still a secondary sector. Its free float market value is somewhat lacking. No dominant sector leader has emerged in the electric sector yet, indicating that current momentum is driven mainly by short-term emotional funds, with no large capital entering.

3. Trend Analysis

I’m not very interested in the recent trend direction because the short-term profit effect is too strong. I have no desire to follow the trend now; I’ll wait until the mainstream trend reappears.

4. Market Summary

Today’s large A-shares performed better than expected, with two consecutive days of big gains, clearly indicating a reversal. The risk in the index has been alleviated, and the likely future trend is sideways to upward. In this situation, I can be more active. There’s no need for much analysis of the index itself, as I mainly focus on continuous limit-ups. As long as the index doesn’t plunge unexpectedly, short-term impact is limited.

Regarding themes, electricity is undoubtedly the main line, with a second wave already showing momentum similar to aerospace. The plunge of Yunnan Energy in the afternoon was a deliberate divergence, which is positive, helping the sector go further. Besides electricity, other sectors also performed today, giving a blooming scene. However, newly emerging themes are mostly one-day wonders, so no need to pay too much attention to them.

Be aware of sustained themes that might impact electricity stocks; otherwise, they are just mainline plays. No point in watching others. Tomorrow, electricity is likely to diverge again, and Huadian Liaoning Energy should also break the limit again, setting a good rhythm. The eighth limit-up is sufficient; no need to push further. If Huadian continues to advance to the ninth limit-up tomorrow, it could trigger a climax in the sector, but continuous surges are risky and may turn into a wave. Breaking the limit and rebounding for a second wave is better, allowing the sector to go further.

Now, a quick recap of today’s operations: I noticed electricity stocks underperformed in the auction, so I sold half of Huadian Liaoning Energy. I admit this was a mistake; I initially advised not to easily give up chips at this level, but I sold half myself, misled by the auction. Then, Liaoning Energy, with a small order block, was unlikely to hold, so I sold it after two more limit-up attempts, missing the chance.

Also, Yunnan Energy Holdings didn’t buy the dip today because I sensed it was afraid of a double top. It kept hesitating in the morning, unable to surpass the sector, so I cleared all positions. I previously bought it because it was safe, often rising against the trend when the market was falling, but now that the sector is booming, it can’t keep up, which I find unacceptable. I’d rather free up positions to chase continuous limit-ups.

Today, I only sold and didn’t buy because I prefer buying when no one is paying attention and selling when everyone is excited. Yunnan Energy started last Friday, Huadian Liaoning Energy bought in on Monday, and yesterday added positions when enthusiasm was still low or even fearful. Now, with high enthusiasm, I need to consider who will follow next. The trend of electricity stocks already has a commercial aerospace vibe, but remember how aerospace failed—at the peak, it disappeared.

My reason for reducing positions today is that I believe electricity will diverge tomorrow, after two days of strong gains. To go further, divergence is better. The afternoon plunge of Yunnan Energy was a masterstroke, intentionally creating divergence. I didn’t know it would plunge, but I thought it was too slow, so I sold everything in the morning. I even mentioned this in the comments, not secretly running away.

Yunnan Energy’s plunge was excellent; the main controller had a plan, actively creating divergence to prevent a continuous wave in electricity stocks. This rhythm is excellent, and the operators of this wave are very visionary. Yunnan’s plunge triggered a wave of electricity stocks, and tomorrow, divergence is likely again. Huadian Liaoning Energy might form a double top, and Huadian Liaoning could break the limit again, creating healthy divergence in the sector. If Huadian Liaoning rebounds and Yunnan Energy cooperates with regulatory measures, another wave in electricity stocks could follow. This rhythm is very perfect. May this prosperous era continue as I wish!

I share my operations in real-time daily and discuss my views on the market during trading, hoping to inspire everyone. If interested, follow me for updates.

5. Daily Must-See

If you’re interested in my trading system or have questions, check out the six posts below. Stock selection formulas, trading systems, and answers to basic questions are all in there!

[Red Envelope] Dry Goods Post Sixteen, On Empty Positions and Trading Modes

[Red Envelope] Dry Goods Post Fifteen, Quantitative Trading System: Quantitative Actions

[Red Envelope] Dry Goods Post Thirteen, The Path of Seeking

[Red Envelope] Dry Goods Post Eleven, Market Auction Trading System (Updated)

[Red Envelope] Dry Goods Post Ten, Software Trading System, Little Known

Dry Goods Post Eight, Market Auction System and Trading Issues

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