[Red Envelope] Escalating external conflicts, how will A-shares respond on Monday?

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Market Summary: On Friday, the index opened lower with reduced volume, mainly influenced by the passive weakness of US stocks on Thursday night. After opening, it steadily strengthened, showing resilience of the A-shares index. Currently, the index is highly controlled, reflecting the determination to stabilize the market. Sentiment-wise, Yunnan Energy Holdings advanced to 7 consecutive boards, leading emotional recovery. Sector rotation continues: Thursday’s strong sectors like liquid cooling, optical communications, PCB, and CPO began to weaken; gas turbines surged then stabilized; computing power leasing, electricity, and Huawei Ascend rotated higher; resource stocks flowed back in the afternoon.

Market Performance: Sector rotation without focus; domestic computing power and electricity remain strong; resource-related small metals are the strongest.

Trading Difficulty: Moderate. (Reduce positions, moderate, difficult, hell)

Highlights: Trend-following, mainly low buy-in, avoid buying on bullish days, do not chase continuous rises.

Weekend Developments:

1. Israel-Palestine conflict, Holms Strait closure, gold dark trading rose on Feb 28, then plunged on March 1;
2. AI military industry, space forces;
3. DeepSeek will release V4 model next week, providing deep support for domestic computing power, collaborating with Huawei and Cambrian to optimize hardware configurations;
4. OpenAI received a new $110 billion investment;
5. Alibaba’s desktop Agent tool CoPaw open-sourced.

I. Trading Review

1. Opening with a slight decline, the index fell over -0.4%, but remains highly controlled with strong buying sentiment. Early divergence expectations were mostly digested; China Tianying’s order book was largest, representing the environmental protection sector, still in a pre-viration state with low position; Enlighten Environment performed average at high levels, not worth chasing. China Tianying also has methanol concepts, which can follow the chemical line with better mid-term logic. The second large order was Gero Software. Quantum tech was influenced by US stocks, with limited opportunities. Lastly, TaiJia shares, representing domestic computing power, remained strong despite US AI stocks falling last night, making it a focus this morning. The chemical sector was weak at open but quickly recovered as expected. Small metals and rare metals rotated higher, indicating no clear market leader and limited short-term holding value.

2. Commercial aerospace rebounded for three days; Zhejiang Wenlian also stabilized, with opportunities in domestic computing power. Early on, Zhejiang Wenlian was bought after a sharp decline. Sunnet Technology sold most after a near 13% rise; in the afternoon, leasing weakened, so all remaining positions were cleared. End-of-day anticipation of the Two Sessions, focusing on Mengcao Ecological, with timing to realize gains around March 5, two days before the sessions.

II. Market Review Today, 3,271 stocks rose, 2,068 fell, with a total turnover of 24,880 billion yuan, down 504 billion from yesterday. The index opened lower with reduced volume, then oscillated higher and closed in the green. Small metals and rare metals continued to strengthen; phosphate chemical sector showed some recovery after divergence; tech sub-sectors rotated and extended; CPO, PCB, and liquid cooling declined; gas turbines stabilized after a surge; electricity and Huawei Ascend strengthened; commercial aerospace oscillated and turned positive; precious metals strengthened at the close; small metals further advanced.

The market had 75 limit-ups today (vs. 61 yesterday), with an 83% limit-up rate (vs. 73%), 65 first-limit stocks (vs. 52), and no limit-down stocks (vs. 3 yesterday). The highest consecutive limit-up was 7 boards, last seen on January 29 with 8 boards, after 15 trading days, indicating a rebound in short-term sentiment.

Sector-wise, mineral resources hit 17 limit-ups, chemical sector 4; electricity 9, computing power 8, Huawei Ascend 4, gas turbines 3, AI programming 3, cultivated diamonds 2. Six stocks hit limit-ups on expectations for the Two Sessions. Overall, the market remains unfocused but continues to revolve around tech and resource price increases.

III. Market Analysis Index:
Market volume was 2.48 trillion yuan. The index opened low and moved higher, with off-market funds stabilizing but resilience emerging. External turmoil increased over the weekend; comparing previous conflicts (Russia-Ukraine, Middle East), if the index opens slightly lower tomorrow, the impact on A-shares should be minimal. Currently, the index is highly controlled, so focus on its rhythm. The market is in a stock-dominated game with sector rotation; next week likely to continue so. Without systemic risk, excessive discussion is unnecessary—just buy low and wait for rotation. Note that with stagnant incremental funds, the rotation’s strength may weaken, making focus more difficult.

Sentiment:
Yunnan Energy Holdings broke 7 boards, restoring some short-term emotional strength after half a month of stagnation. Immediate continuation is unlikely; observe its performance. Low-level power stocks may also catch up. Today’s general sentiment improved slightly; resources and tech sectors that rose recently will ferment over the weekend. If the market opens high tomorrow, avoid chasing; consider profit-taking. Overall, expect sector differentiation. Market rotation has breadth but is hard to focus; within sectors, buy low, avoid chasing.

Resource stocks performed well but lack clear leaders; breadth is good, so low buy-in with correct direction has high probability of profit. Tech sector shows divergence: foreign-related segments like gas turbines are strong, while liquid cooling, PCB, and CPO declined; if they recover Monday, prioritize gas turbines, with core stocks like Chuanrun, Hualan, Huawei Ascend-related stocks such as TaiJia, Huawei Tiancheng, Huafeng Tech, and high-tech growth stocks like Gaoxin Development and Tuowei Information. Previously strong optical communications are entering a rebound phase, with Zhongtian Tech, Huashengchang, and FiberHome relatively strong.

Commercial aerospace continues to show small positive signals, gradually stabilizing, driven by oversold recovery and Two Sessions expectations. No significant pressure to realize gains; risks are small, but volume is insufficient for large gains, mainly individual stock movements. Core stocks include Aerospace Development and Aerospace Power.

IV. Profitable Stocks Today 1. Chemical:
Chengxing Shares: high open, recovery expected.
Jinzhongda: large open, acceleration expected.
Liuguo Chemical: high open expected.
Hebang Bio: surge expected.
Yuntianhua: volume-based, oscillation expected.
Jinniu Chemical: high open expected. Core methanol stocks.

2. Cyclical:
Jiangwu Equipment: large open expected.
COSCO Shipping: high open expected.
Zhangyuan Tungsten: acceleration expected, but likely divergence.
Hunan Gold: high open expected.

3. Others:
Yunnan Energy Holdings: high open expected, passive on Friday, large oscillation expected, not easy to rise further.
Gannan Energy: large open, acceleration expected.

Longfei Fiber: oscillation expected.
Honghe Tech: low open, oscillation expected.
Dongcai Tech: oscillation expected.

TaiJia: one-word limit-up expected.
Huasheng Tiancheng: flat open, surge expected.
Tuowei Info: high open, difficult to hit consecutive boards.
Gaoxin Development: high open expected.

V. Summary
Tomorrow, the index is expected to open lower and oscillate; overall sentiment will be mixed. Chemical and domestic computing opportunities are relatively better; other sectors have small differences, with uncertain odds. Mid-term, resources still hold opportunities; stocks that haven’t risen yet may do so gradually. Avoid chasing long streaks of gains; focus on low buy-in after divergence or low positions for accumulation. For those with poor rhythm, pick one sector on divergence; if wrong, wait a day. Patience is key—chasing at peaks often leads to big losses.

Wishing everyone big gains tomorrow.

Xiao Shu’s Dayi Trading Philosophy:

1. Follow the trend, ride the momentum!
2. Pre-judge, follow decisively!
3. Seek the strongest, only do the strongest!
4. Actively admit mistakes, cut losses timely!
5. Reject comparison, aim for stable profits!

Short-term trading is like walking on a tightrope—glamorous on the surface but full of danger. It amplifies market fluctuations and easily traps investors in a vicious cycle of chasing highs and selling lows, blinded by greed and panic. Discipline is crucial:

• Set strict stop-loss limits for each trade; once hit, exit decisively without luck-based hopes.
• Follow the trend; only trade clear trends, avoid counter-trend moves or guessing tops/bottoms.
• Control position size; allocate funds reasonably based on market conditions and risk tolerance.
• Avoid frequent trading; wait patiently for the best opportunities.
• Stay calm and rational; keep a balanced mindset regardless of profit or loss, execute according to plan.
  Remember, short-term market movements are uncertain, but for prepared traders, they are opportunities, not gambling. Steady operation and flexible adaptation are my keys to success and the foundation for future progress.

May your stocks rise like the morning sun, reaching new highs daily; investing be like sailing with the current, steadily earning profits; holdings be potential stocks, their value rising step by step; operations be like divine strokes, precise buy and sell. Wishing the market a long rainbow, wealth flowing endlessly, profits continuous, harvest abundant! If you find this helpful, please support with likes, tips, and comments—let’s build a positive community atmosphere. The environment of Taoxian is in our hands! Likes, tips, and good intentions are not just for supporting the author but for everyone to curate and elevate quality content, making the community better. More premium posts mean higher standards, increasing the chance to see good stocks. We plant, we harvest!