[Red Envelope] The pharmaceutical sector breaks out, and the Shanghai Composite is filling the gap. Has the main trend emerged?

Iran–U.S. news easing boosts market sentiment, pushing the broader market sharply higher. A-shares open higher on inertia and follow through; at the call auction, technology stocks show the strongest momentum. Demingli and Opto-Electronics (Optoelectronics Co., Ltd.) hit the daily limit in single-character style, while MINGPU Optical & Magnetic (铭普光磁) jumps straight to the second limit. Funds try to push for gains in the technology direction, but the front-runner人氣 group—Changfei Optical Fiber and Hangdian Co., Ltd. (杭电股份)—opens and then drops. Are funds a bit afraid of heights? As Honghe Technology breaks the daily limit and turns into a large sell-off, Demingli also plunges and turns back to green. Overseas compute power starts to cool off; domestic compute power is dragged down as well and plunges. Hongjing Technology rises and then falls back. Funds switch to trading in the healthcare sector. [TaoStock Bar]

Tianjin Pharmaceutical (津药药业) hits a second daily limit at the call auction that exceeds expectations to advance to a 4th straight limit. Jiu’an Medical reverses and covers back, but healthcare doesn’t strengthen—instead it follows the index higher and then falls back. Only after technology sells off do healthcare start to rebound around 10:00, and at 10:00 Demingli just turned green. This shows that funds’ desire to go long healthcare isn’t that strong.

As Kailaiying advances to a 2nd limit, healthcare gradually pushes toward the daily limit. Wanbangde gets pushed back to re-close by the sector’s pressure; compute power beats and Dasta collapses after breaking the limit—again showing the PK relationship between compute power and healthcare.

In the afternoon, healthcare didn’t strengthen; it even dropped back. Wanbangde blows the limit; Lianhuan Pharmaceutical also blows the limit; Shutaishen falls back. Funds then switch around every which way to fan the flames and lift momentum. But judging from the main-line factors, healthcare still has hope to advance as the main-line theme—because there is volume and price, there are daily limit moves, and there are leading stocks. The only drawback is that Wanbangde is about to face the 10-day doubling regulatory issue, which will slow down the sector. Today’s climax will be harder to follow up tomorrow, because the market’s trading volume is insufficient and the expectation is to rise and then fall back,

During the day, the money-losing effect concentrates in the power sector. The originator of “from boards to bottom and back” (地天板) Wuyingjiao’s reversal pioneer Xinengtai Shan (无溢价) is directly stepped on without any premium. Huadian Energy and Huadian Liaoning both end up “bought and buried” at the down-limit (跌停). The power sector is effectively blacklisted.

At this time, the market pace is extremely fast. In the presence of good news, the market directly gets sold off even after a gap-up; with bad news, it’s easier to see a V-shaped reversal. This isn’t the era for blindly doing call-auction plays. Yesterday, whatever—motorcycles and rail transit equipment—surged; today even the front-runners all gap up with single-character limit moves and then sell off into big sell-offs. It’s not suitable for “strength on strength,” and it’s also not that suitable for “turning from weakness to strength.” Only when it’s the main-line leading upswing is it suitable to turn from weakness to strength; in the quant era, you have to get used to low-bidding on pullbacks and taking profits on pops.

Back to the index perspective: during the day, it repeatedly tried to struggle and attack the gap at 3955, but the issue is that it’s shrinking volume—indicating that attacking funds are insufficient. It may be because the Qingming Festival is coming soon, so funds remain cautious. Then tomorrow, the index will most likely return to box-range trading of 3850~3955. Money entering the market is likely after the holiday. So the best strategies right now are two options:
**1）Wait for a breakout with volume (right-side trading)
**
2）Wait for panic (left-side bargain hunting)

Sector analysis:

Healthcare exploded last Friday and exploded again today. Funds have been involved substantially; during the day it printed climax. Treat it as a minor main line for now. Future走势 depends on four people:

The 4-limit Tianjin Pharmaceutical, the 3-limit Jiu’an Medical that broke the lock and then reversed back, Wanbangde in a trend-led upswing, and Kailaiying in a 2-limit. Meinuohua (美诺华), after two consecutive days of weakness, is essentially done. As long as among those four, at least three are able to exceed expectations and keep printing big bullish candles, healthcare will keep moving forward. Starting tomorrow, the pull-ups from the back ranks will mainly be for taking profits. Focus on the core names in the front ranks.

Optical communications can’t be killed. The “Three Musketeers” from Yizhongtian are in charge. When it has fallen enough, institutions and quants will pick up. Rallies are used to take profits. It only suits plans for selling declines. Sentiment stocks are Changfei Optical Fiber/ Hangdian Co., Ltd./ Farspring Technology (法尔胜). Sentiment names were resistant to declines in the past few days, but today they lag the sector—suggesting funds are a bit afraid of heights. However, as long as among the three, at least two stay above the 5-day line and there isn’t a big bearish candle, the issue is not big. In the future, watch whether Hangdian Co., Ltd. can build a swing-trading pattern.

The above analysis is only my personal view and does not constitute any investment advice. If you trade based on it, you’re responsible for the gains or losses. Finally, thank you, brothers and sisters, for your support with “boosting coupons.”
@静待花开12345
@推翻倍
@suruibin
@魏安泽
@A伯0119
@峰子予
@小胖糯
@到处乱跑
@取名怎么那么难
@凔海難為水