Maximizing Market Opportunities
What is the best opportunity in the market? Here, the best opportunity refers to a time when the overall market is at its peak, coinciding with the emergence of the strongest stocks.
Next, let’s discuss what constitutes the best timing for the market, as well as how to identify and operate with the best-performing stocks.
Part One: What is the best timing for the market?
There are two key indicators for the market's optimal timing:
1. When the market is in an upward trend, with the index approaching critical moving averages (such as the 10-day and 30-day marks), while simultaneously experiencing price increases accompanied by rising volume (indicating strong market activity).
2. Following a significant mid-term drop and subsequent short-term plummeting, a strong rebound characterized by price increases and rising volume must be observed. This rebound should possess considerable momentum, rather than being a weak bounce.
Part Two: How to identify and operate with the best-performing stocks?
After ensuring the market is stable, one can commence specific stock trading operations.
1. Principles for identifying the best-performing stocks:
1. Focus on the latest hot sectors, where the intensity of the hot trend should be at least 5%, ideally above 7%.
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2. Within this sector, only the leading stocks stand a chance of achieving astonishing short-term gains.
3. The market's position must either be on the brink of a dramatic reversal or in a state of enhancement. It is only when the market is in a phase that is both recognized and hesitant that hot sectors can truly attract ongoing inflows of hot money or substantial capital, which then propels the excitement, extension, and diffusion of the sector.
2. Principles for operational thinking:
1. Psychological principle: While technical conditions and fundamentals are not overly critical, the authenticity of the theme and the momentum of the current trend are extremely important.
2. Action principle: Be decisive in maximizing your positions, employing a three-stage rhythm; do not be lured into buying at low prices that you’re unsure about. Buy a portion when it seems appropriate, another portion at lower levels, and a final portion during strong surges.
3. Realization principle: Allow stocks that are sailing smoothly to ride their profits a little longer; however, for those that hover around their cost price, consider exiting early. Balance the contention between massive profits and small losses or gains with a belief in your success rate, and implement proper stop-losses and tiered take-profits.
3. Intra-day operational flow:
1. Market assessment: Observe whether the daily K-line of the overall market is in a bullish arrangement. Choose a familiar indicator such as MACD, KDJ, or other indicators; ensure they support a bullish stance, preferably in conjunction with weekly patterns.
2. Sector assessment: Examine the intensity of themes, strength within hot sectors, focus on stocks with concentrated holdings, and gauge the ignition strength of key sectors.
3. Target locking: When a genuinely strong hot sector arises, the initial judgment can be challenging. Ensure the sector is overall strong and market-recognized, ideally fueled by significant information backing from major players.
4. Selecting the strongest from the strong: Details
1. Generally, the first stock to break through in the sector is considered the leader and can be pursued (using the three-stage purchase method).
2. Analyze the fundamentals of the stock that hits the limit first, including moderate circulation, appropriate pricing, historical volatility, the nature of participating capital, characteristics of the main force, and habitual trading patterns to determine if it is suitable as the leader.
3. If the opportunity is missed on the first day, confirm again at market open on the second day whether it remains the strongest within its category.
4. If the prior three points hold true, coupled with strength evidenced in the minute chart, a continuous limit might indeed be underway, thus confirming the leader, allowing for segmented triad purchases at entry points.
5. If already bought on the first day but realize the error on the second day, one should exit or switch stocks as soon as possible.
6. In the presence of explosive major themes, if the leader is unreachable due to a limit one, look for opportunities after the first open, remaining proactive but cautiously watchful to avoid excessive heights.
5. Principles for operating with the explosive leading stocks:
When faced with an explosive major theme where the leader cannot be purchased due to limitation, how should one respond?
1. Anticipate the difficulty of buying the leader and consider placing orders for a limit ticket before market open.
2. Proactively identify second-tier leaders with favorable turnover and circulation conditions. Utilize the aforementioned methods for confirmation and enter promptly, as secondary leaders in big themes can yield remarkable gains; when such opportunities arise, don't clench to the first leader—boarding first is key, and one can switch later or discover new leaders.
3. Exercise patience; the first-tier leader, after consecutive limit rises, will undoubtedly present opening opportunities. Stay vigilant, and if the sector remains robust overall, seize the moment to enter.
4. If you have already invested in the second-tier leader, exit at the threshold of the first-tier leader's opening to capitalize on the switch opportunity.
5. Beware of opportunities arising from new leading stocks during secondary rises. If previously valid concept stocks show signs of diminishing momentum after multiple rises, and a new similar stock emerges that rapidly closes a limit, timely follow-up for purchase may be warranted.
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