Chapter 69 How high is vertical, how long is horizontal

Liu Bin rushed into Yin Zhijie with a hopeful look on his face.

In the trading room next door, Li Feng stared at the Shanghai Composite Index chart with a frown.

Beside her, Zhao Xinyue pouted and muttered, "That's nothing serious. Didn't the market hit a new high again?"

Li Feng shook his head and said, "A nine-story tower is built by piling up earth. Similarly, the collapse of a building is not something that can be accomplished overnight. It requires a process of fermentation."

"You and Menghan, try to come to the trading room as often as possible these past few days. This is the critical moment when the stock market turns from bull to bear. It's the most valuable moment in the stock market. Many investors may not even witness this once in their lifetime."

"Only after experiencing it once can one truly grow up and become a seasoned leek, a true veteran stock investor. Only then can one have hope, learn from the lessons, avoid being harvested when the bull market turns to bear market next time, and snowball one's assets into something bigger."

Lin Menghan nodded and said, "I'll have Yao Jiu keep an eye on the TV station first. If it doesn't work out, I'll take a few more days off."

Zhao Xinyue pondered and said, "I'll ask the head nurse if I can switch to the night shift, from 4pm to midnight. That way I can work and trade stocks at the same time."

On June 15, the Shanghai Composite Index closed at 5062 points, down 2%, but the trading volume was still over one trillion yuan.

On June 16, the Shanghai Composite Index opened at 5004 points, gapped down, and plummeted all the way, falling 3.47%, with trading volume shrinking to 895.4 billion yuan.

The market closed down for two consecutive days, which made many investors wary. Zhao Xinyue and Lin Menghan also widened their eyes and stared at the stock market.

Zhao Xinyue's gaze was fixed on CRRC.

This stock, which I bought in January, was suspended for a month since May 6th, and was finally released on June 8th, with a limit-up on that day.

On June 9th, the huge turnover closed with a big black candlestick with a sharp drop of -9.32%.

On June 10, it plummeted again by -9.73%!

After that, there were several days of small declines. On June 16, it plummeted to the limit down of -10.01%.

This made Zhao Xinyue gasp.

In just six trading days, CRRC's stock price plummeted from 28 yuan to 18 yuan, a full drop of 10 yuan, or 35%. If the position had not been cleared, the 125,000 yuan invested at the time would have shrunk directly to 812,500 yuan.

Even if I listened to Li Feng and cleared my position in time, I still retreated by almost 20% from the highest point!

It's so easy to lose money in the stock market.

Seeing her look of regret, Li Feng pointed out, "As the saying goes, how long the horizontal is, how high the vertical is. Similarly, how high the vertical is, how long the horizontal is."

"This stock, a leading player in the Belt and Road Initiative and a low-priced restructuring stock, has already risen eightfold from its low of just over 4 yuan. Look at that K-line chart, it's like a towering mountain. Just look at it. A stock of this size and popularity, coupled with a bull-to-bear market, is sure to plummet like a landslide."

Hearing this, Lin Menghan blinked, as if thinking about something.

Li Feng continued:

"In fact, the market's bull-bear cycle is, to a certain extent, also a game of converting funds into chips. In a bull market, a steady stream of funds pours into the market, converting funds into chips and pushing the chip prices higher and higher until they can't get any higher. Similarly, in a bear market, waves of funds leave the market, converting chips into funds, and at the same time, selling off the chips to lower and lower prices until they can't get any lower."

"Right now, management is clearing out leverage, which is like strangling the throat of a sick cow. The continuous influx of funds into the market has been cut off, and smart money is constantly withdrawing from the market. If this continues, the funds in the market will gradually dry up, and once it reaches a critical point, it will collapse like an avalanche."

"At this time, the big bear market is coming!" Lin Menghan answered quickly.

"That's right!" Li Feng praised.

In the trading room next door, the atmosphere was extremely solemn and you could hear a pin drop.

Liu Bin stared at Yin Zhijie's K-line chart and felt a great fear enveloping his heart.

On June 15, he had just entered the market for Yinzhijie, and just a few minutes later, hundreds of sell orders came out of nowhere, which immediately plunged Yinzhijie's price from 111 yuan to the lower limit of 103.41 yuan, resulting in a -10% limit drop that day!

It’s faster than the time it takes to smoke a cigarette.

That wasn't the end of the story. On June 16th, Yinzhijie's call auction closed at 95 yuan, a -8.13% drop from the opening. Just seven minutes later, at 9:32 a.m., over 600 sell orders suddenly flooded the market, sending the stock price plummeting to 93.10, a further -9.97% drop! This put the stock just 3 cents away from its lower limit of 93.07 yuan.

One limit down means more than one million yuan.

Two consecutive days, two limit downs, that’s more than three million yuan!

If there are a few more limit downs, won’t all the profits made in the past few months be wasted?

Veins popped out on Liu Bin's forehead. He clenched his fists and shouted at the monitor, "Pull it up, pull it up, pull it up!"

Perhaps, the dealer heard Liu Bin's cry. Only one minute later, a large buy order of 129 lots suddenly appeared, drawing an almost 90-degree straight line, which pulled Yinzhijie from 93.10 yuan to 98.70 yuan, an increase of more than 5 yuan at once, and the decline narrowed to -4.55%.

Liu Bin breathed a sigh of relief.

It seems that the market maker of this stock has not given up. Even though the market is not good, it is still trying to save itself.

However, he was only happy for a few minutes when waves of small sell orders suddenly appeared, and suddenly pushed Yinzhijie's stock price to the lower limit price! 93.07 yuan.

Liu Bin's heart was in pain again.

Afterwards, another buy order of 178 lots lifted the share price of Yinzhijie... Later, at 10:07, the share price of Yinzhijie once again hit the lower limit... Half an hour later, it went up again... In the afternoon, at 14:07, it was pushed down to the lower limit again until the closing.

More than 1 million yuan, gone again!

Liu Bin's fist slammed heavily on the computer keyboard, making it make a "bang, bang" sound, which scared Cao Song who was standing next to him.

Cao Song put away the keyboard and wanted to slip away.

Liu Bin turned around, looked at him, and scolded him, "Cao Song, get rid of your inside information. Tell me, are you trying to kill me like a pig? Are you killing me like a pig?"

Cao Song argued:

"Mr. Liu, this is unfair. This is just a coincidence. Look at June 4th, 5th, and 8th. Didn't the price drop by more than ten points in a row? And then it rebounded? Moreover, the turnover rate is only about 1%. How did the dealer sell the stocks? And to whom? This is just a shakeout before the good news!"

"Master Liu, believe me, Yinzhijie's internet insurance license will definitely be issued in the next few days!"

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