The ceasefire positive news helps the index break through! Has the three-stage collaboration of the electricity calculation association begun?

Hello everyone, I’m Dao Ge. Because the director scripts I shared in advance were perfectly executed by the market multiple times, and some friends even call me Sheng Dao or Wang Dao. Everyone can call me whatever you like—just be happy. Starting today, Dao Ge will resume daily posts! Friends who have followed me for a long time all know that at the end of last year I went into closed-door seclusion to悟道. After I came out, the entire trading system achieved a qualitative leap! The most core reason is that I mastered a kind of “Dao”—the “cycle” that I’ve been talking about recently. With the power of cycles, not only did I accurately predict the end turning point of Aerospace on January 13 and that of precious metals on January 30 more than a week ahead, but also, in the most difficult month in the recent three months, I was fortunate to dance in sync with the core Huadian Energy together with the cycle of the computing-electricity coordination phase for one stage![Tao Qiu Ba]

But maybe because after悟道, my articles changed from weekly to biweekly, I found that many brothers only read the main post and replies and still feel a bit behind, or they haven’t been able to fully understand the power of cycles. Therefore, in order to help brothers better follow the market and experience the charm of cycles, Dao Ge is resuming daily posts, so that you can have something to reference every day and grow faster!

Actually, this cycle system is simple too— the key work is in the post-market review. I don’t know how you usually do your recap. Do you look at which sector had the biggest intraday gains? Or do you check which individual stocks hit limit-up? Or do you focus on consecutive limit-ups and use a number-of-boards strategy? When your attention first lands right on individual stocks, it becomes hard to observe the changes in the entire market from a big-picture perspective. The more correct approach should be a top-down process.

**The main purpose of the recap is to solve three fundamental problems—can you do it? what to do? how to do it? Next, follow Dao Ge to recap. Let’s resolve these three questions step by step, from top to bottom! **

1. Can you do it—cycle and the big trend

This morning, the first thing I saw after waking up was a positive development that the parties overseas reached a ceasefire. With this news prompting the index to open sharply higher, it was rare that we did not see the usual “open high then slide low.” Instead, we saw the index go high and stronger, rallying with a huge increase in volume, and a big bullish candle on the scale of more than 8B, breaking out of the box range, and it also moved above the 20-day moving average. So is today’s breakout real or fake? Will the index then go on to a main up-leg? Let’s look step by step.

First, from a cycle perspective: currently, since the stop-the-fall and bottoming on March 24, this box has been running for 11 days up to today. We are not yet at the days of the 13-day key time window. However, even with the ceasefire-positive stimulus from overseas, we still saw a breakout with a gap and increased volume. But the validity of today’s breakout is not confirmed today—it will be confirmed in the next two days. How do we confirm an effective breakout? It’s simple: the minimum requirement is that if it’s a true breakout, then today’s gap is the breakout gap, and in the short term it should not be filled back. So over the next two days, if it doesn’t drop back to fill the gap, or if it’s even stronger and doesn’t fall back inside the box range, then we can count it as an effective breakout. Once these two days confirm the breakout is effective, we will coincide exactly with the 13-day time window, and then the new main up-leg stage can start smoothly.

From the index perspective: here, we are about to bounce up to the lower bound of the previous consolidation box, and we will start to gradually “release” a batch of dense trapped supply—meaning that the sell pressure will gradually increase. In addition, the 20-day moving average is also currently trending downward, which will likewise create pressure on the index. Therefore, in the period ahead, if there isn’t even more breakout-style volume, the index basically can’t keep putting in successive large bullish candles to climb back above 4200. This is definitely still a time to digest positions.

So no matter whether it’s from the cycle side or the index side, it will provide an observation window for the index. If it’s a real breakout, the next stage won’t be short either—we don’t need to rush just because it’s only one or two days. If this is a fake breakout, then chasing tomorrow is very likely to be buying near the top, which will be even more torturous.

After recapping up to here, the conclusion is clear. Although the index has broken out, right now we are in the transition window from phase two to phase three, so there’s no need to act in a hurry. Wait until phase three is officially confirmed before taking action—it won’t be too late. If phase three here can’t be executed, it becomes easy to enter at a high level, and the rhythm will feel very uncomfortable. Also, for most big-market moves, the first wave of broad advance (a general uptick) is often not the right timing to enter. Instead, it’s usually the moment to take advantage of the rebound to free up cash and make preparations for the next stage’s main line. Once the main line is confirmed and can execute, then you can strike hard!

2. What to buy—main line and secondary line

Although today the index broke out and surged, and the number of advancing stocks exceeded 5000 with mostly broad gains, the set of individual stocks that most represents real money-making effect is not as good.

For example, in the phase-two core main line, the optical-fiber direction: today the sector index still jumped strongly and hit a new high. But the absolute core, Glorious Fiber (Longfei), lagged badly at a high level and could only barely maintain a red position. As for the more emotion-driven plays like Farsuit Victory and Xinneng Taishan, one was struggling in deep water while the other had a failed breakout and then dropped sharply. Similar cases include Tianyao Pharmaceutical and Wanbangde—these were exactly the kinds of things that had the strongest profit effect before today’s index rebounded. Yet today, when the index had a big rebound, the feedback provided was quite mediocre. Why is it like this? On one hand, even though Farsuit Victory managed to bypass the abnormal move monitoring, it still ended up in the key monitoring pool, which affected high-level sentiment. On the other hand, it also indirectly shows that the funds from the old-stage main line are gradually withdrawing and participating in the new stage instead—this is not necessarily a bad thing.

Since that’s the case: even though the index here still can’t confirm a truly effective breakout, we still need to make preparations as if it were a true breakout into phase three. That means we should look for the new main line direction. With today’s broad-based advances, can we tell what the core direction is for the new stage? Yes and no. Today you can casually find sectors that rose more than 4%, and the number of limit-ups is even more than 100—so it doesn’t seem like it’s easy to identify. But if we’re clear that the current cycle is the computing-electricity coordination, then directions unrelated to computing-electricity coordination can be immediately ruled out. Combine that with the long-mentioned conditions of “10+300+3,” and further filter—then in reality, the directions we can look at today are only two.

First is the computing-electricity coordination’s computing-power direction, which was the most proactive at the open. Today it had two 20cm elastic limit-ups, plus Zhong Anke with more than three boards, and even heights like Oriented Technology (Aori De). The number of limit-ups clearly exceeded 10, perfectly matching the “10+300+3” conditions.

Of course, there’s a flaw in the computing-power direction: today the sector index only just stood above all moving averages. Overall, the trend isn’t actually particularly good, so we still need further observation. Next, if it can keep running above all moving averages for two or three days, then there shouldn’t be too big a problem.

The other direction is optical fiber—the main direction of phase two. Today the sector index hit a new high and also formed a breakout move. Naturally, the flaw is obvious too: core high-level names are collectively taking a breather. Even though the sector surged, the number of limit-ups wasn’t many. However, since there’s currently no clear sign that it’s ended, we also can’t ignore it. There is a certain probability that by switching to new low-level core names, optical fiber can be extended from phase two to phase three. So this direction also needs attention. Besides, optical fiber has an advantage: it’s both offensive and defensive. After all, if the index here isn’t a true breakout and later falls back into box consolidation, then we’re still in the phase-two consolidation range—so isn’t it still optical fiber?

Finally, let’s talk about the medical sector as the secondary line. It should continue to move out alongside the main line, but the specific core still needs further checking. Intraday, the stronger ones were Menovo (MinoVao) which top-locked with help from last night’s trading board, and Ji’an Medical which has the strongest trend. As for Wanbangde, which avoided the abnormal move but still got hit by Farsuit Victory’s influence and was weaker today, it’s still above the 5-day line. Tianyao had a big bearish move breaking the board—so what if it reclaims with a reversal tomorrow? So all of these need to be tracked and observed.

After completing the second step of the recap, the conclusion becomes very clear. If the index is truly breaking out, then computing power and optical fiber are both directions that need attention, and both have opportunities to produce a new round of main up-leg. And among today’s first-limit-up boards, there’s likely to be the birth of the next stage’s bull stock. If the index breaks out and then turns into a fake breakout that falls back into the box and maintains phase-two consolidation, then optical fiber remains dominant. The secondary line still looks at medical; as a secondary line it will only offer local stock opportunities. Still, we’ll look at those four.

3. How to buy—core and plan

Since we already know that the focus next is on the computing-power and optical-fiber directions, and that among today’s first-limit-up boards a new stage bull stock might be born, then is there one with “a certain temperament” worth watching? Let’s talk about optical fiber first. Last night, Farsuit Victory ultimately still got into the key monitoring pool. Today’s whole day was mostly negative feedback. But at the open, it still provided an opportunity for a dramatic spike via a corner-turn board. We don’t need to go head-to-head with regulation. At the open, the pull-up that fills the gap, and whether it turns red or not, and whether it breaks down below moving averages are relatively reasonable pull-back entry (risk control) chances. Wanbangde, as another name that also got blocked by an abnormality trigger, would naturally be dragged along by Farsuit Victory—so treat it the same.

Because of this, the divergence among high-level names isn’t small. Longfei, as the absolute trend core, even with today’s big rally, could only manage to stay red after pulling back to the 5-day line. But since Longfei is the optical-fiber core of this round, for optical fiber to keep going, Longfei can’t go into an A move. At minimum, it needs to maintain a consolidation structure. Then later, when it pulls back to the 10-day line, that actually would be an opportunity too. For others: today optical fiber didn’t have many limit-ups. Tongding Internet is also an intraday core, but it’s only a 2-board today and doesn’t match the “first board born today” rule we discussed earlier. So compared with Tongding, we’re more inclined to see whether the first-board breakout names—Far East and Yongding—can start a new round of main up-leg. How do we confirm whether it can start the main up-leg? The “breakout + pullback confirmation + renewed strength” technique we mentioned earlier can be used.

On the computing-power side: today there were a ton of limit-ups, so it’s hard to see clearly. But there is one core that has been working its way out for a very long time already: Oriented Technology (Aori De). I have to say, back on March 24 it was a first board; on March 27 it was also a first board; and today it’s still a first board. None of the key days missed it—there really is something there. But tomorrow is also an acceleration expectation, so it may not necessarily offer participation opportunities. The rest: let’s watch them as they go. When Friday arrives and it filters out most of them at the 3-board level, it will become clearer. After all, Huadian Energy was also at the 3-board stage before I could spot the signs.

After finishing the last step of the recap, is the plan for tomorrow ready? Keep optical fiber locked on the overall king, Longfei. If the 10-day line offers it, that’s a higher-certainty opportunity. Then check whether the first-board breakout names from today—Far East and Yongding—after the pullback move can resume strong performance. On the computing-power side: first look at Oriented Technology. But tomorrow is very likely to have no participation opportunities. The real focus needs to wait. As for the other first boards, it’s even harder to see clearly. On the next day it’s 1-to-2, and the day after (2-to-3) after filtering out a large bunch, then we’ll know better. Good food never fears being late!

By this point, the three major problems to be solved in the recap—can you buy, what to buy, and how to buy—are fully solved by this cycle system. Does the plan to execute during the next day’s intraday session then come out? So on the next day, you only need to wait for the market to give signals, and then firmly execute the plan you prepared in advance. When expectations match reality, everything becomes a natural outcome.

That’s where today’s recap ends. As you can see, this time when I resume daily posts, I re-constructed the recap framework. The purpose is to bring everyone to understand the market top-down together—not just see only the individual stocks in your own eyes from the start and then only ask whether this can be bought or that can be sold. Recap is exactly this kind of top-down process. When you follow this flow all the way through, who is the core of the market? What kind of stocks you should do, and how to do them— the market will give you the answers.

Also, Dao Ge wants to share a general schedule for my time during the trading day.

【9:15~9:25】During the call auction phase: the call auction can be said to reflect the decision made by funds after thinking carefully all night—it’s a time point that guides the direction. At this time, I generally look for things like big-order limit-up that sets direction, stocks with call auction performance that exceed expectations, and so on—I mainly watch the market.
【9:25~9:30】This phase also basically involves organizing the information obtained during the call auction. If necessary, I may give some important information in the reply area for everyone.
【9:30~10:00】The first half hour after the open is basically the most important half hour for funds to launch proactive attacks, and it’s also the key time window for executing the plan made the night before.
【10:00之后】Generally at this time I’m freer. Except for some especially important abnormal moves that I’ll pay close attention to, most of the rest of the time Dao Ge will chat with everyone in the reply area. If you have questions, feel free to ask anytime!
【14:30~15:00】The last half hour before the close—especially the late session—is usually the time when funds start positioning for the next day’s行情 in advance, and it’s also a period that needs key observation.

While resuming daily posts, it’s also a major test of my own time management and energy allocation. If this article helps you, please feel free to like, reward, and support me!

Next comes the reward leaderboard of trading board dragons:
April 7 recap list:

Dragon #1 @JX哥 2500 points

Dragon #2 @guduoduo 1300 points

Dragon #3 and #4 @红警666 @一郑锋 1000 points

Motivation leaderboard:

Thanks for the brothers’ support! Current “Jinfen Group” members: @深泉A @大明白8 @奋告大师 @nikkkkki @洪州鸣哥 @一郑锋 @核桃的大兜子 @扑街007 @年华果粉 @六脉达摩神箭 @bjt789 @山水有相逢XS @风行a股 @啊民哇 @老吴炒股日记 @随大侠 @念缪 @cassssper @五花膘 @豹哥1991 @池老哥 @红警666 @妖凸妖 @炽垚 @不知几次爆仓 @神翼 @hhhhjyy, thanks to the big shots for your support and trust!

【Disclaimer】All stocks mentioned in this article are only used for observation, research, and交流, and do not constitute any investment advice. The stock market is risky—enter the market with caution!