Join you on the path to enlightenment - Year 3 of the Year of the Horse: First heat up the hot oil until it sizzles, then add garlic and lobster.

Good evening, everyone! Welcome to Sister Yao’s Daily Review. [Taogu Ba]

Starting from the second trading week of March, the market trend has basically been as expected—no surprises in rotation, no unexpected gap-ups followed by declines. The morning saw selling, with intraday pulses. The geopolitical conflicts benefited certain sectors, and the tech sector showed a clear pendulum effect. How will the strong performers tomorrow behave? Stay tuned for the analysis below.

First, thank you all for watching, liking, commenting, supporting, tipping, and urging broadcasts. Love you all.

Please continue to like and comment. Let’s exchange ideas and catch the妖 (monster) and bulls together.

Back to today’s market overview.

**1. Index Overview**

Recently, the indices have been oscillating mainly between 4100 and 4190. Over the weekend, the main focus was on the Israel-Palestine conflict, which had a significant external impact. Major economies in Asia, Europe, and America experienced substantial declines, which naturally affected the A-shares market. Today, the index opened lower, down about 0.7%, with intraday dips reaching 1.6%. It closed near the opening price, just below 4100. Market volume expanded to 2.6 trillion yuan, as volatility increased, leading to higher trading frequency and volume. Therefore, today’s index shows a long lower shadow but a short real body.

In the short term, the index is likely to continue oscillating around 4100, with support zones for accumulation and resistance zones for distribution. Trading volume remains around 2.5 trillion yuan, with increased volatility and volume. The market is expected to revolve around the two sessions’ topics. If news favors the market, testing higher levels is possible.

The intra-day gain-to-loss ratio is about 1:3, indicating overall weakness. Capital sentiment remains cautious, with increased volume mainly driven by forced buying rather than active demand, so this isn’t a sign of sustained inflows. The market style continues to revolve around hot topics and news, mostly involving first-move plays driven by arbitrage, with sectors lacking news catalysts remaining dormant.

**2. Market Details**

**a. Short-term Market Sentiment**

Overall, short-term sentiment is lukewarm—neither overly optimistic nor severely negative, more of a chaotic state.

In terms of bidding, the recent limit-up streaks are limited—only three boards on Friday, indicating a very low level. Today’s bidding shows that, apart from Zhuolang Intelligent opening lower, others performed relatively well. The one-word limit-up of Shun Na shares opened wide, causing Han Lan shares in the same theme to be restricted. Since the strongest stocks tend to be bought, and in the quant and market capital flow models, there’s rarely a one-word limit-up swap, Han Lan’s trend is more of a trend-following wave. Then there’s the continued one-word limit of Wangli Security, which is hard to evaluate. Recently, limit-up stocks like Yasheng Group and others have broken after hitting four boards, indicating some divergence in limit-up plays.

Regarding market grouping, there’s no strong collective trend. For example, weekend news about energy and power, like Yunnan Energy, reached high levels but lacked capital support for collective holding. Everyone is just trying to arbitrage at low levels. So, forming a high-level group is unlikely; focus is on whether mid- to low-level stocks can form small groups. Comparing core themes like Yunnan Energy, which is at a higher level, the probability of collective holding is low—these are high-level stagnations, possibly used for distribution.

Elastic sectors also show mixed signals. No continuous limit-ups; the last was Tongguang Cable, which after hitting a limit, didn’t continue upward. The overall height is capped. When the sector is strong, stocks like Nanjing Power Grid can’t even break into second boards. The North Exchange stocks are driven by news and have high break rates, with no clear short-term momentum. Last time, Keli Co., Ltd. had seven first boards but no sustained follow-through, indicating traders are cautious about chasing highs.

From the main board’s relay, market grouping, and elastic sectors, there’s no clear preference. The key is whether small-cap stocks can be lifted by capital. News can be a bonus. The core indicator is whether high-level stocks like Yunnan Energy can form small groups; if not, they might be used for distribution.

**Key sentiment stocks:**

Prepare your seats; the morning comments section awaits updates.

**b. Sector Rotation Characteristics**

Themes revolve around the Israel-Palestine conflict and the tech pendulum, with a focus on arbitrage. Over the weekend, crude oil futures surged, likely prompting a high open for oil and gas stocks. As expected, stocks like Chuanyuan Petroleum, QianNeng Hengxin, Keli Co., Intercontinental Oil & Gas, and Shandong Molong opened high—either limit-up or near-limit-up. But two key points: First, oil and gas stocks surged for two days last week and then sharply reversed, creating trapped positions. Second, the market isn’t naive; if stocks are already on the board, fewer traders are willing to chase. Also, incomplete buying—like Intercontinental Oil & Gas’s overnight order of 15 million shares, but only 3 million shares today—indicates weak momentum. No one is willing to push for a strong breakout, and with news about controlling oil prices, the quant funds have started to exit, leading to a downward trend.

However, the oil and gas sector isn’t finished; it remains a key area for capital. Today’s high open and subsequent decline might reverse in the afternoon, with rotation and a possible rebound.

Next, the算电协同 (computing power synergy) and crawfish concepts are just炒作 (speculative hype), mainly about computing power, which is a recycled theme. The strength is far from a climax. For example, Han Lan, which had some prior hype, only hit four boards and then didn’t continue. The low-priced stocks like Jinkai New Energy hit a limit-up, but after two boards, the premium isn’t high, capping the height. When the sector is strong, stocks like Nanjing Power Grid can’t even break into second boards. North Exchange stocks are driven by news, with high break rates and no clear short-term momentum. Last time, Keli Co. had seven first boards but no follow-through, indicating traders are cautious about chasing highs.

In terms of the main themes, electric power remains resilient, with ongoing fluctuations. The recent oil futures plunge and subsequent rebound suggest that rotation might occur again.

The算电协同 (computing power synergy) theme, driven by news like crawfish, is considered average. Weekend trading was quiet, and such news tends to ferment. The market mostly shows first boards; after oil futures dropped, funds pushed a second board with Tuo Wei Information, but old core stocks like Huasheng Tiancheng fell back sharply. The strength isn’t comparable to the power grid sector. Therefore, the power sector has better prospects, with more opportunities.

Additionally, chemical stocks had some limited limit-ups, but they are essentially oil-related, as oil is the blood of industry, and chemicals are a key part of traditional industry. Stocks like Jinniu Chemical, at higher levels, didn’t get hit with a limit-up, indicating limited market impact.

**3. Trading Strategy Sharing**

Overall, sector rotation dominates the market. The war-related themes and power vs. computing power form a pendulum. If early trading sees a rotation, the afternoon might reverse sharply. Traders should watch for this and prefer early divergence opportunities for low buy-in, aiming for subsequent pulses or preemptive high-day trades. Avoid chasing during pulses. Focus on oil and gas, and power sectors.

Regarding limit-up speculation, since the height isn’t high and there’s no negative feedback, moderate participation is possible—there’s some tolerance for risk, but don’t expect too much. It’s arbitrage-like, with slightly higher certainty than first-board arbitrage. For stocks with sufficient capacity, break-and-recover plays are also a strategic option.