[Red Envelope] 4.2: Xi'an Taihua Road's 100 million thefts in Southeast China, can JinYao Pharmaceutical reach new heights in innovative drugs?

Introduction: “seeking and searching, cold and desolate, woeful and wretched—at times of slight warmth returning, the hardest thing is to recover and set oneself right.”[Taoguba]

Today I remembered Li Qingzhao’s “Slow Chanting: Seeking and Searching,” though it’s a work of autumn sentiment, using it to describe these 2 days of market action feels even more fitting. In these 2 days, you can see that even within a big bull-market structure, there are moments when cold seeps bone-deep. At this stage, no matter whether it’s going in on a pullback or chasing via limit-up, it feels like all patterns have failed in the face of a quant-style squeezing. At this stage as well, I’ve seen the warmth and coldness of human relationships. Some friends are worried my pressure is too high and come to send comfort; some friends offer sincere criticism and suggestions. At this point, Mi Kaelun has to thank everyone for your support, understanding, and trust. And precisely because of that, I’m willing to share without reservation everything within my cognition range. That is also the motivation that keeps me going. Together with everyone, let’s cross the bull and bear markets!

Maybe everyone’s understanding of cycles isn’t that deep, so they can’t feel the damage caused by patterns failing. Here’s the simplest example: right here, you can be caught in chaos—within chaos, doing pullback entries is basically fine. For example, when the index rises, going to buy AI can work. Doing intraday quant-strength short-gap ignition points is also fine—yesterday’s Oryde and Meiliyun are also fine. Now the failure here is mainly that pullback entries get choked. Chasing strength on the way up: if you can’t capture an intraday premium, then even with a high-quality limit-up order the next day still won’t have any premium—just like yesterday’s Oryde and Meiliyun: there was no premium. As for doing relay plays—no need to say more, it’s evident how difficult it is.

When everyone thinks the trend is the mainstream, in practice it still isn’t smooth. For example, the pullback entries in Changfei Optic Fiber, Shuhua Sports, Datongnan, and Dashengda—these require very strict requirements for both theme timing and index timing. Either you buy on pullback with your eyes closed to bet on the 5-day K-line’s upside. If you try to model the timing and then enter, the difficulty doubles.

Regarding the index’s judgment, recently there hasn’t been a major mistake—this is still on track. Regarding theme timing and forecasting, macro-wise it’s not too much of a problem; micro-wise, it has started to be pulled back and forth by quant-style chaos. Just because you can see it clearly doesn’t mean you can trade it correctly. From last Friday’s lithium battery start, to aerospace, pharmaceuticals, power, optic fibers, and then oil, the desk fans started accelerating—chaos intensified. By today, it’s time for intraday cross-choking: power, AI, oil, pharmaceuticals—each got choked for the whole day. Once you go into buy/sell points, the requirements are even higher: your buy point is usually fine, but if you’re just a minute late, it’s a world of difference.

This market won’t last too long. After Huadian Liaoneng, it will be Shanjian Shares. Following the cycle route, if another one or two 4-board transition cycles come out, it’s about time for a big cycle to be on the verge of emerging. At the same time, the next 3–5 trading days will also be a process in which the index probes the bottom. Everyone before the holiday can quietly watch the show. When the conditions for the big cycle are born, Mi Kaelun will analyze and break it down immediately.

The Taihua Road arbitrage model is still strong. In this kind of chaotic market—this is exactly what it likes most. Today, it bought more than 100 million (over 8B) of Datongnan to arbitrage against the strengthening in power—and it also counts as verification of the idea. Sometimes, stock picking is fine; it’s the stock-by-stock timing that’s truly hard to grasp. Datongnan’s board was so good on Tuesday afternoon—yet there was no premium. If you didn’t sell, it could be that the next day it would still get trapped and stay dull. If you sold, it might do something like today’s reverse-boards. But there’s no certainty in that—everything depends on how it looks right at the moment.

The structure of Tianjin Yaojiu Pharmaceutical is quite similar to He Fu China’s連板 (multiple consecutive limit-ups) stage—very similar in structure. He Fu China’s “popping up” can also be seen as a tribute to Tianjin Yaojiu Pharmaceutical. Tianjin Yaojiu Pharmaceutical here will most likely act as a sentiment pioneer—watch how many boards of height it can hit.

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4.2: From the index down 3, it starts to test with two feet back-and-forth! Power repairs; innovative drugs complete the dissension-to-unity shift intraday; oil gets stimulated by news; trend AI starts to show an index divergence structure
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I. The overall market**
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Market turnover/volume: 185.77 billion; shrinking by 3B. 28 stocks hit limit-up; 5 hit limit-down. The yellow line is below; the small-cap gap/dissension level is greater than that of large caps**

The index is basically in line with yesterday’s judgment. The pullback structure to the downside here is correct. As for whether it breaks 3794.68, I don’t know—but you still have to go test it. Whether that bottom is valid depends on what happens if it later drops to that level: if it doesn’t break and premium comes in with incremental capital, then support is valid. If a double bottom forms on the index, you can then bet on a big rebound. If it breaks through 3794.68 again, then you need to keep watching where the exhaustion point of the bears is. At that time, you’ll have to calculate the key levels temporarily. For this point, patience is more important than gold; confidence is more precious than profits.

Today was a strong-disagreement structure. The market was relatively messy, and the downswing caused by the shrink in volume, plus the chaos among themes, produced malicious “cross-choking.” There were only 6 stocks with consecutive limit-ups; 28 limit-ups; 5 limit-downs. The board-closure rate was 61%. There were 4,378 stocks trading in the green. These are all strong-distribution data. Next, don’t rush. Wait for the bears to release; if they don’t release, there’s no way to start a big行情 (big market trend).

II. Sectors
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On themes,** at the open, the pharmaceuticals sector was just barely in line with expectations. The two-sided needle (Liangmianzhen) didn’t open strongly; instead, what was stronger was power—especially after Leshan Electric Power began to get pulled up right after the open. Star Power, Leshan Electric Power, Xineng Taishan, Zhongli Group, and so on, are more oriented toward the power grid. Then the market moved into rotation. Oil was driven by quant arbitrage based on news; trend AI also didn’t want to give up; innovative drugs also had disturbances during the session. In the afternoon, as the index kept dropping and weakening, oil & gas and pharmaceutical commerce surged again, and strength increased further. All day long it was chaos: a big brawl among pharmaceuticals, power, oil, and AI!

Pharmaceuticals

5 boards: Tianjin Yaojiu Pharmaceutical
2 boards: Peking University Medical, Yibai Pharmaceutical
1 board: He Fu China, Jimin Health, Oukang Pharmaceutical, Shuanglu Pharmaceutical

Yesterday’s “flight-to-safety” highest-board had tremendous quality. Throughout the day, the theme “fermentation” rhythm was smooth; multiple related stocks’ trends weren’t broken and their formations were intact. But today, the main focus of theme fermentation shifted to pharmacy-related sub-sectors. Combined with the expectation that the pharmaceuticals sector will keep strengthening, in the future you can focus on three core routes: first, the raw material price increase logic; second, the earnings line; third, the extension of pharmacy stocks toward a consumption attribute. When the market shows a rotation from high to low (or from one leadership group to another), the price action will give clear detail signals. Watch for related themes that have intraday linkage with Tianjin Yaojiu Pharmaceutical.

Right now, pharmaceuticals are showing resilience. When the index rises, they rise; when the index falls, they also rise. Over these two days, these pharma stocks can essentially be treated as the main line to look at. In April, the innovative drugs at Shoutai Shen were fermented exactly like this—just as clear as day.

Pharma today has more of a “flight-to-safety” attribute, but yesterday it had more “riding the index upward” characteristics. Tianjin Yaojiu Pharmaceutical, representing innovative drugs, currently has 2 logics: 1) innovative drugs going overseas—there’s incremental logic; 2) the price increase logic. 3) and what Mi Kaelun YY (speculates) about: whether the AI side of innovative drugs has produced some truly revolutionary things—we don’t know.

So moving forward, we’ll see how far pharma can go. Pharma looks at Tianjin Yaojiu Pharmaceutical and Wanbangde. Up to now, I actually prefer Minnoa’s convertible bonds: intraday T+0, good or bad can be settled the same day.

Iran–U.S. (Mideast) situation / “Makers”?

1 board: Heshun Petroleum, Beiken Energy, Blue Flame Holding, Compton, China International Engineering, China National Offshore Engineering

Yesterday I said things would ease; today I say it’s tense again? Trump stock trading has two sets of skills. I even doubt that Old Tr… has opened short positions in A-shares. Before going to bed, US stocks were rising nicely—yet on our 9:15 open you flip?

Power

3 boards: Xinzonggang, Tongda Co., Ltd.
1 board: Xineng Taishan, Chuanneng Power, Leshan Electric Power, Zhongli Group

Power should be basically gone. Last night, besides news, today Tongda Co., Ltd. strengthened. Leshan Electric Power got a one-word limit-up due to the news stimulus, which led to the quant side’s arbitrage program.

Power and pharmaceuticals/AI fought all day, but no clear winner emerged. You’ll see it tomorrow—who can succeed. Huadian’s “double heroes” (two top names), don’t drop the chain and drag your feet! Back then, they were also once mighty and sharp. Even if you have to step back, you’ve got to exit with dignity. Also, late in the day Xineng Taishan saw a runner—did it escape from a fiber optics logic, or did it leave based on the power sector’s走势 (price action)?

Optical communications

1 board: Huiyuan Communications, Zhongli Group, Huanmai Technology, Xineng Taishan

Changfei Optic Fiber is the first “sunrise node” of the index resonance on March 24. Besides Changfei Optic Fiber, there are also stocks like Shuhua Sports, Wanbangde, Xineng Taishan, Oryde, etc.—all are node stocks that came out of the “stopping the decline” after March 24, and they all走的趋势 (followed the trend).

So how far the trend of Changfei Optic Fiber can go is unknown. But as long as the leader keeps maintaining high-level consolidation, the little brothers won’t constantly stop following. Mincp Optomagnetics, Richsense Technologies, Datong Interconnect, Yongding Co., Changjiang Communications, Zhongli Group—these are all “switching up the styles” and offering support as the little brothers.

Xinghui Environmental Materials: plans for indirect control of 19.25% voting rights of Xinghui Environmental Materials
Tongda Co., Ltd.: 2025 net profit 161 million yuan, up 533.17% year over year
Chongyao Holdings: cumulative share repurchases about 15.41 million shares
Bohui Co., Ltd.: Q1 net profit 40 million–50 million yuan, up 183.99%–204.99% year over year

Quick summary: The current cycle is in the disagreement-withdrawal / defensive group-hugging stage. The index is selling off and most individual stocks are generally declining; sentiment is cautious and a bit cold, and capital quickly rotates to seek refuge. Although this is a chaotic retreat phase, it should be the darkness before dawn. Just wait patiently. Sentiment intraday is still in a disagreement state. But judging from Shanjian Shares, sentiment doesn’t look that bad. Still, since the index isn’t good, everything is not okay. Theme rotation today happened extremely fast; chaos started to strengthen. At the open, pharmaceuticals ran the strongest. On news stimulus, shipping and oil opened higher. Power repaired and optical fiber led the gains. In the afternoon, rotation into CPO, hogs, and lithium batteries. Near the close, oil & gas and pharma commerce strengthened against the trend. The core node is** Tianjin Yaojiu Pharmaceutical**—observe its intraday time-share linkage to judge the high-to-low rotation in pharma. For optical communication, lock onto** Changfei Optic Fiber** and watch out for signals of small-cap consecutive limit-up “distribution.” Themes to watch are optical fiber, pharma, and power; everything else doesn’t work. Changfei Optic Fiber, Tianjin Yaojiu Pharmaceutical, Wanbangde, Tongda Co., Ltd., and Xinzonggang—plus an independent-logic World Cup theme: Shuhua Sports. It’s a bit like Nezha’s Guangxian Media; the takeout battle’s Forest Packaging. Market style is still mainly trend-oriented. Relay plays are very weak. The market has started to prefer the earnings-forecast-upward line—this is something to pay attention to.

III. Individual stock analysis

Shunfa Hengeng: Power strengthens; it didn’t move, so no longer watching.

Dashengda: Failed to hit the board; once it broke the intraday structure, no longer watching.

Optoelectronics Co., Ltd. (Guangdian Shares): The structure is still okay; the key core in optical rods—watching a bit more.

Tongda Co., Ltd.: Today’s opening bid was extremely beyond expectations—8B, and the opening bid volume was more than 3 times that of Xinzonggang. I directly chose to watch Tongda Co., Ltd. based on the opening bid.

IV. Plans for tomorrow

For the index: prepare for two rounds of further bottoming tests. The probability of the index finding its bottom twice is very high. Until a bottoming test succeeds, I don’t recommend everyone forcing their way through. The ecosystem is terrible! I’ll go ahead to probe the path for everyone first. Once the rebound is confirmed to be valid, I’ll focus on analyzing it for everyone.

For the cycle: in this churning period as it forms a base, there is still no “start” signal. Just stay in chaos for now, and wait for new theme material to emerge!

For sentiment: on Friday, sentiment will continue to have differences. There is a possibility of intraday “disagreement turning to unity”—this is the point to observe intraday.

For nodes: Tongda Co., Ltd. vs Peking University Medical vs Yibai Pharmaceutical.

For market style/pref: trend is better. Do more research on trends and do less relay.

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Thank the following brothers and sisters for pushing the wheel; don’t lose motivation—must be red forever!

@Xiatian de Bingbing@Zhang Xiaozhang123@Zhuangge shuoggu@Mr Dongfanghong@Ai jiuyou@Nanyou Xiaochao@Qiu wen123@JPLivermore
Thanks to the following brothers and sisters for their tips and rewards. Sing a toast of appreciation—may your financial fortune flourish!
@Anying Shitou Ren @Zhuangge shuoggu @Mr丶Q @Tiantian sky @Zhu Liu yi yi @Zu gejiang @Guazhou Du @xjx9001 @Caozhou You Ruoshen @Lan Lian ta @Gaoxing27 @Shiguang Manbu1688 @78901 @Laomo927 @Mr Dongfanghong @Shi Hai @Chongming Chongming @Guangda Jingwei @Xiaoxiao Xiaozhouzhou @Zhang Xiaozhang123 @Xiaotianmo @Qindian Liunian @Zhushenglongtou Kongkonglong
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