April 19, 2024 Morning Trading Strategy

The index retreated after hitting a new high yesterday. Although the trading volume was not significant, the upward trend of capital is already evident.

This round is really more capable than the last one. Although there was a stock market crash (股 Z), the index managed to reach a new high, and the key point is that everyone's confidence is recovering.

Yesterday, the index showed a "仙人指路" (Fairy Points the Way) technical pattern, indicating that the market has opened up room for further gains. There should be a subsequent pullback due to inertia, but the pullback is an opportunity. As long as we can hold on until the end of this month, once the annual and quarterly reports are released, next month will be sunny.

After a broad rebound the day before yesterday, the market saw a divergence yesterday, with the number of rising and falling stocks returning to normal.

This is quite good. The extreme volatility feels like being young and in love, where your girlfriend changes her mood at the drop of a hat, and you're completely at her mercy.

Although the index pulled back after rising, it still broke through the previous high of 3090 and started attacking the annual line.

Near the 3100-point mark, the market failed to sustain the trading volume and eventually pulled back. Multiple attempts to test and break through the annual line indicate that capital intends to release the trapped positions from this year.

However, it's clear that the trapped positions at this level are heavy, making it difficult to break through directly. The only option is to oscillate and trade time for space.

Today is Friday, and the pressure from public opinion is high. It's the futures settlement day + the "419 curse," so the index has a need to pull back, but the downside is limited. The 3045 zone is a support area, and the pullback is still a buying opportunity.

Now let's look at themes and individual stocks:

1. Low-altitude economy
The low-altitude economy is the most memorable and popular direction. During this wave of declines, capital first chose to resist in the low-altitude economy sector. In the previous downturn, apart from the earnings line, the low-altitude economy was the only thematic sector that resisted the decline. This can also be seen as the market's most emotionally recognized thematic direction. As soon as the rebound signal appeared yesterday, it naturally became the first sector to rise.

Moreover, the sector is constantly benefiting from policy support, with daily news catalysts. Key updates:
17 provinces have listed low-altitude economy development as a key task for this year:
1) The CCID Research Institute under the Ministry of Industry and Information Technology stated that China's low-altitude economy scale is expected to exceed 1 trillion yuan by 2026;
2) Zhuhai: By 2035, the "City in the Sky" will be fully completed, and a preliminary planning plan has been formed;
3) The 2024 (14th) Civil Aircraft Industry International Forum will be held on April 25-26 at the Lin Kong Exhibition Center in Xi'an's Airport New Town.

2. Newly listed stocks
Since the China Securities Regulatory Commission (CSRC) issued four documents on "3·15," A-share IPOs have entered a freeze, with zero acceptances and zero reviews for two consecutive months. Nearly 100 companies have voluntarily withdrawn their applications.

IPO financing in Q1 this year fell 77% YoY, and the number of withdrawn applications hit a new record. In Q1, 64 companies withdrew or were rejected by the Shanghai and Shenzhen stock exchanges. With IPOs largely halted, A-share IPOs have entered a freeze. IPO supervision is becoming stricter, and the pace of new listings has slowed. This has brought continuous benefits to newly listed stocks, catalyzing the valuation of high-quality recent IPOs.