2.3 Review: After the broad rally, focus on the core tomorrow

More than 3,000 companies have been declining every day for over a week. Today finally saw a broad rebound, with over 4,500 companies rising in the two markets. However, the market did not see significant volume, and to continue rising tomorrow, more trading volume is needed. If volume cannot be sustained, profit-taking today is somewhat expected. The index formed a long lower shadow today; if profit-taking occurs tomorrow, it is expected to dip back and then rebound, which would indicate that the index has stabilized and a rally may begin. [Taogu Ba]

In the non-ferrous metals sector, yesterday Google’s view was very clear: oversold. Today, most of the stocks that hit three consecutive limit-downs opened up with increased volume. After releasing trapped positions, capital is likely to flow back into thematic sectors. Therefore, the recovery in commercial aerospace, AI applications, and computing power today was entirely within expectations. After liquidity is released in non-ferrous metals, the subsequent trend is likely to resemble the previous wave of commercial aerospace retreat, which trapped many investors. Each rebound is an opportunity for later-stage investors to exit. Time is needed to exchange chips and release trapped positions, creating a chance for another rally. In the short term, the outlook is bearish, but in the medium to long term, I am optimistic about gold and copper.

Commercial aerospace has experienced a long period of recovery, surge, pullback, divergence, and further recovery. Today finally saw a sustained large positive candle throughout the day. However, I do not expect a strong second wave to start immediately. Tomorrow is still expected to be volatile, focusing on core popular stocks such as Hangkong’s development and Xin’s maintenance, photovoltaic stocks like Jun’s Da and Ao’s Wei, etc. The later stocks are likely to surge inertia-wise and then pull back, followed by oscillation. Focus on core stocks or look for stocks with divergence from the previous day for low buy-in.

In AI applications, core popular stocks like Zhejiang Wen, Li’s Ou, and Biao Biao show a clear seesaw pattern compared to commercial aerospace. The development of thematic sectors shows some competition. Commercial aerospace has recovered to a small climax today, while AI applications are less consistent and even show divergence. Tomorrow, AI applications are expected to outperform commercial aerospace, but overall, chasing highs is not recommended; low buying is preferred.

Regarding AI data centers, yesterday I mentioned quantitative flatness. Today, aside from some top stocks continuing to hit the limit-up, most of the lower-ranked stocks opened with profit-taking. However, after the index exceeded expectations and then dropped sharply, rotation pulled stocks back up, similar to the white wine sector last Thursday. After divergence today, there is a chance for recovery and inflow tomorrow.

Starting tomorrow, the focus will shift back to core stocks across various sectors for groupings. After the index’s recovery and rebound, market sentiment has improved significantly. Pay attention to the pre-Chinese New Year group-buying trend, and consider taking positions in core stocks with divergence in each sector. The market has a very high tolerance for popular stocks.

Today, Google has resumed updates for the midday quote. Everyone can keep an eye on it.

The above views are personal notes for reference only and do not contain any investment advice.

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