After deciding on the next investment direction and selecting the trading target.
Su Yi then clicked on the K-line chart of the stock 'Teli A' and observed it carefully, finding that this stock, in the previous market's continuous 'thousands of stocks hitting daily limit down' adverse environment, had recently hit three consecutive daily limit downs.
The internal chip structure could be described as completely fragmented, with virtually no profitable positions, only cut-loss positions and stop-loss positions.
Moreover, due to the collapse-like fall in its stock price, the turnover rate was insufficient.
The main concentration of internal chips for this stock was still at the bull market peak, a price range twice the current stock price.
This meant that the chips for this stock were completely vacuumed in the middle section of the continuous daily limit downs.
Furthermore, this stock was not a margin trading and short selling target in the market, nor did it have institutional holdings, and its market capitalization was only over 3 billion yuan, with a circulating share capital of only about 2 billion yuan.
It was naturally a very suitable target for speculation.
Su Yi believed that as long as the market's liquidity crisis could be resolved, the overall market trend could stabilize slightly, and bullish market sentiment could warm up,
Then by using capital to acquire the cut-loss and stop-loss positions of this stock at the bottom, and then raising the stock price to continue going long.
Igniting market speculative sentiment for this stock, there would basically be no excessive pressure on the market in the short term.
Before his rebirth, during his ten years of trading career.
He had also deeply researched the trading strategies of various top large speculative funds in the market.
Therefore, he also had his own understanding and insights on how to use his capital to influence retail investor sentiment, to guide other capital to form a concerted effort, to secure the leading position, and to create market leaders.
The advantage of a sufficient capital volume for control, and a necessary understanding of trading strategies.
Coupled with the enhancement of his original memory.
Su Yi did not believe that he would fail to make money by speculating on the stock 'Teli A'.
However, even though he had a comprehensive trading plan and a trading strategy for speculating on 'Teli A' in his mind, he would not be eager to buy the dip and build positions before the market liquidity crisis was completely resolved.
A qualified investor, a mature trader.
Besides knowing how to find opportunities.
Most importantly, must also learn to wait.
Warren Buffett, the stock god, could patiently wait for a full twenty years to build positions and buy his beloved 'Coca-Cola' stock at the right price.
Although Su Yi might not have such patience as the stock god.
He could still persist until the moment the market liquidity crisis was completely resolved, until the panicked leveraged funds and margin accounts finished their capitulation, and bulls began to massively and broadly cover their positions.
Just as he was meticulously formulating his subsequent trading strategies.
And planning to completely abandon shorting stock index futures and switch to going long on stocks.
Over the two weekend days, under the bombardment of successive positive news released by the regulatory authorities, the extremely suppressed bullish sentiment began to surge and rebound, and frantically ferment.
Investors who held heavy positions in stocks were all smiles and overjoyed.
Those investors who were previously utterly desperate and on the verge of forced liquidation all breathed a huge sigh of relief and praised the regulatory authorities profusely.
Those investors who were forced to liquidate, stop-loss, or unwillingly cut their losses on Friday were now all crying bitterly and filled with regret.
Those holding short positions in stock index futures, who previously thought they had seized a market advantage, were now all anxious, fearing that Monday's stock index futures would open too high, forcing their positions to be liquidated.
Those investors who were originally in cash were also regretting, wondering why they hadn't bought the dip and gone long when the market showed unusual movements on Friday.
In short...
Under the unprecedented release of concentrated positive news.
Even though it was not yet time for market open, bulls already had full expectations and were in a state of euphoria.
Many even had their 'mental trades' hitting the daily limit up.
However, when the actual market opening day arrived, everything was not as good as everyone imagined.
On Monday, July 6th, the market reopened for trading.
Driven by the concentrated heavy positive news over the weekend, the Shanghai Composite Index, Shenzhen Component Index, and ChiNext Index all opened with gains of over 6%, with over 700 stocks hitting the daily limit up at the market open across both markets.
And several main stock index futures contracts, which were subject to naked short selling restrictions and individual investor account opening restrictions, even saw a collective daily limit up, directly forcing countless new short investors from last Friday to unwillingly stop-loss or be directly liquidated.
But this extreme bullish counterattack, this aggressive short squeeze.
Collapsed suddenly after less than 5 minutes of joy among the vast majority of investors.
At 9:35 AM, the Shanghai Composite Index opened high and then fell, retreating to around a 3% gain, while the Shenzhen Component Index and ChiNext Index had already lost 4 percentage points of their gains.
At 10:02 AM, the Shanghai Composite Index retreated to around a 1.5% gain, while the ChiNext Index had already erased all its intraday gains.
At 10:45 AM, the Shanghai Composite Index retreated to the flat line, while the ChiNext Index had already plunged to a 2.33% loss below the water, and at the same time, the 'CSI 500 Index Futures main contract' had continued to plummet from its opening daily limit up position, falling to a 3% loss below the water.
At this point, the market liquidity crisis reappeared.
At market open, the confident and excited bulls were once again crushed by leveraged funds and margin trading accounts.
Fortunately, seeing the unfavorable market situation.
On the weekend, 21 brokerage firms, which had made commitments under the regulatory authorities' requirements and announced a joint investment of 120 billion yuan, truly began to inject funds to support the market by increasing their holdings in blue-chip ETFs.
Thus, from 11 AM onwards.
Blue-chip weighted stocks in both markets began to receive large amounts of capital inflows, gradually repairing their intraday losses.
However, the concentrated unusual movements of blue-chip stocks could only prevent the Shanghai Composite Index from falling into the abyss, but could not save the completely collapsing ChiNext Index, SME Board Index, and CSI 500 Index.
Therefore, when the market trading time reached the afternoon.
The trend of the Shanghai Composite Index began to seriously diverge from the trends of the ChiNext Index, SME Board Index, and CSI 500 Index.
And as trading time progressed, the divergence between the two also became increasingly larger.
At 1:40 PM, the Shanghai Composite Index, driven by a continuous upward oscillation of numerous blue-chip stocks, especially with the four major banks and two oil giants almost hitting their daily limit up, still maintained a positive territory, while at this moment, the ChiNext Index, SME Board Index, and CSI 500 Index had all plummeted to a 7% loss.
At 2:05 PM, the Shanghai Composite Index's gain returned to about 1% due to the continued rally of blue-chip stocks, while at this moment, the 'CSI 500 Index Futures main contract' had fallen from its opening daily limit up to the daily limit down.
Finally, when 3 PM arrived and both markets closed.
The Shanghai Composite Index successfully closed with a substantial gain of 2.42%.
However, the ChiNext Index and CSI 500 Index, which did not have continuous capital inflows from brokerage firms to protect them, still closed with an extremely dismal decline of over 6%.
What was even more peculiar...
Was that even with the Shanghai Composite Index maintaining a strong positive close.
Both markets still could not escape the shadow of 'thousands of stocks hitting daily limit down'.
Countless ordinary investors, furthermore, despairingly discovered that even if the Shanghai Composite Index soared, their stock accounts were still entirely at the daily limit down, suffering huge losses.
(End of this chapter)
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