Hexun Information Gao Luming: Is the new rally coming? Should I add more?

The long-awaited big surge is finally here. The three major indexes were boosted by positive overseas developments from last night and collectively delivered a high-volume, strong advance to the upside. The Shanghai Composite Index even exceeded a 100-point gain in a single long bullish day. And, moreover, nearly 5,200 stocks are up. Has a new upswing started? Should we add to our positions right now?

He Xun information’s Lu Lu Ming said: First, let me share my viewpoint. I believe today’s market has already given the signal that Wave Three is starting, and the next step is an important opportunity for us to focus on. On the one hand, we can see that the market’s strength today is indeed very strong. The three major indexes, influenced by the impact of a sudden ceasefire-related news item from last night, directly opened higher with a gap, and then launched into continuous upside momentum. As of the close, they delivered a big bullish candle, and the Shanghai Composite Index, unusually, surpassed a 100-point long bullish advance.

First, in terms of the strength of the advance, it indicates that the market’s main force of long-position capital is relatively sufficient. This kind of ample strength is very helpful for pushing the market to continue with another wave of gains in the short term. Second, the market has truly broken through again the key point of this rebound phase. Since we emphasized on March 23 that the market was about to start a round of rebound, the index then proceeded to launch a push higher. However, because the external situation saw reversals, the index then continued to go through consolidation, and later formed a Wave Two high at the 3,948-point level. And today, the market broke through this key level in one move, which means the Wave Two high has been surpassed and we have officially entered what kind of Wave Three upside-advance trend. From this perspective, it indeed has formed a state of breakout.

Also, the third point is this: the market’s large funds, including off-market funds, are continuously moving in. Today, we see first that the traditional sectors representing large internal funds—whether insurance or securities—have all posted strong gains. This indicates that internal large money has started to exert itself. And the technology direction that drives sentiment is also rallying strongly. So what does that mean? It means that the market’s long sentiment inside the market is finally being activated. What is the most crucial point? Off-market funds are starting to rush in. Today we will find that in both the Shanghai and Shenzhen markets, the trading volume on a volume basis exceeds 8,000 billion. What does that indicate? The capital that had been staying on the sidelines watching has finally begun to enter the market. Only if this kind of capital keeps flowing into the market can the market stage a new wave of upside. So, putting it all together, I believe that today at least it has provided a signal that Wave Three has started, and the next step is our opportunity.

[Editor: Shao Xiaohui ）

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