Chapter 320: Hold on, don’t fall before dawn
Tuesday, August 20, 2024.
Jisilu temperature: 3.9, Shanghai Composite Index: 2895 points
The road to bottoming out is so cruel and so long.
It fills one's heart with boundless despair; it makes one unable to see any light or find any hope.
I believe that the vast majority of stockholders who are not mentally capable have already left this A-share market, which they believe will never be able to recover, and which fell before dawn.
As a result, the trading volume of the A-share market has shrunk to more than 400 billion these days...
This is a bad thing because many people leave the market with scars and losses.
But this is also a good thing, because more and more people are coming to this market with hope to fight for the future.
To be honest, the current market may seem hopeless, but it actually contains great opportunities.
To a certain extent, its opportunity is comparable to the historical bottom of 998 points in 2004-2005.
Last time, it was the century-long bull market triggered by the resonance of the Chinese and American economies.
This time, the economies of China and the United States will exchange positions, and China will rise as the starting point of a historic bull market.
If you ever regret not being born in 2005 and buying the bottom at 998 points,
In the future, will you still regret not buying the bottom at 2800 points in 2024?
Here are some predictions about the future market:
1. The U.S. interest rate cut cycle is about to begin, and China’s interest rate hike cycle is about to begin.
Changes in China and the United States' financial and monetary policies will directly affect the capital market, especially financial sectors such as banks, insurance companies, and securities companies, as well as individual stocks in sectors that are sensitive to currency values.
Therefore, you must stay away from U.S. stocks, U.S. bonds, U.S.-related assets, and these related listed companies;
And, stay away from all types of debt assets in my country as much as possible.
(The domestic convertible bond market has been in a state of bloodshed recently. On the one hand, it is under pressure from the stock market bear market, and on the other hand, my country’s domestic interest rate hike cycle is about to begin...)
2. The U.S. stock market will collapse downwards during the rebound, and the A-shares will continue to rise during the collapse.
The shift in the interest rate gap between China and the United States will directly reverse the flow of international capital and affect the trends of US stocks and A-shares.
The US stock market seems strong now, but it is already at the end of its strength. In the future, it will fall in a two-step decline.
A shares seem very weak now, but they are showing a rising trend. In the future, they will rise in a two-step forward and one-step backward pattern.
This is because the valuation center of A-shares, as well as the center of the market, are basically controlled by banks, insurance companies, and securities companies.
In the future, as the interest rate hike cycle begins, the performance of these sectors will further increase, thereby supporting the rise of A-shares.
Not to mention, there is also the support of international capital flowing into the inland.
3. In the future, there is a high probability that we will see a financial crisis and severe inflation.
The start of the U.S. interest rate cut cycle is destined not to be peaceful, and there is a high probability that it will be accompanied by intermittent plunges in the U.S. stock market.
This will, in turn, affect A-shares in a conditioned reflex manner.
At the same time, the Federal Reserve's interest rate cuts and money printing will directly push up commodity prices, thereby triggering another round of inflation.
This can be seen from the history of the Federal Reserve raising interest rates in 2022, which directly lowered commodity prices.
Therefore, the future is turbulent but also full of hope.
Today's quote: Boring and cruel.
After the Shanghai Composite Index opened at 2895 points, it began to plummet all the way. Coal, nonferrous metals and shipping were the hardest hit, and only the banking sector turned positive.
Many people are laughing at the banking sector for going against the trend, laughing at the fact that its performance is declining while its stock prices are rising.
But things are different now.
The probability of the Federal Reserve cutting interest rates in September has exceeded 50%.
Therefore, my country's interest rate cut path should be nearing its end, and will soon be tightened as the Federal Reserve continues to flood the market with money, thus entering the interest rate hike channel. The relationship between China and the United States is like the sun and the moon, yin and yang, rising and falling, and falling together.
The start of the interest rate hike cycle is the biggest benefit to banks and other financial sectors.
Of course, when this good news comes into effect, it is very likely that the performance of financial sectors such as banks will become average.
Financial Information:
1. The US dollar index fell below 102, and Federal Reserve officials hinted at a "interest rate cut."
Almost all investors are watching September to see whether the Federal Reserve will cut interest rates and by how much.
Once the Federal Reserve ends its high-interest deposit-raising operations, other countries will breathe a sigh of relief.
2. Signed contract with China Y.
3. Avita Investment HW leads the signing of the agreement.
This bull market is marked by the reversal of positions between China and the United States and is set against the backdrop of major changes unseen in a century.
Therefore, the big bull stocks that emerge in this bull market must be those with Chinese themes, Chinese background, Chinese stories, and extremely high growth performance as their biggest background.
Just like the rise of the United States in the past, the birth of great companies such as Coca-Cola, Ford Motor, Dell Computer, etc.
Behind this is the rise of the United States as the world's first industrial power.
Therefore, at the starting point of this bull market, we must stay away from those declining comprador companies and choose those companies with Chinese genes and promising future.
Among them, the automobile industry is the representative of the new quality productivity that is most supported by current policies (as well as other fields such as ships and chips).
In this field, there is only one path for the future of smart cars, just like the only operating system in the past was WINDOWS.
In the future, smart cars will be equipped with HW autonomous driving technology and become popular all over the world.
Therefore, when investing in the automotive industry, you can only choose HW series smart cars. It is best to choose targets with performance. Do not speculate and hold for the long term.
4. Black Wukong explodes.
On the surface, it is the rise of the domestic gaming industry and a landmark event. From a more macro perspective, it is the public opinion behind China's rise that strongly supports it.
Therefore, in future investment, we must follow the general trend and choose the future.
Just like in the past real estate cycles, countless people, whether intentionally or unintentionally, are destined to succeed as long as they step into this path.
Just like in the previous liquor cycle, as long as you choose the relevant companies, you will definitely make considerable profits, at least one or two times, and as much as seven or eight times, or even more than ten times.
Similarly, at this historical moment, we must keep our eyes open and choose to invest in industries that will have both performance and reflect our country's advantages in the future, which will surely achieve twice the result with half the effort.
Shareholders exchange:
1. "Xia Houjuan who loves longan bread":
"We've all been stock traders for over a decade. Right now is garbage time in the stock market, with endless ghost stories and constant wailing. What we need to do now is to work together to get through this garbage time and embrace the bull market."
Yes, now is garbage time, choose the right target.
Just wait and wait for the cows to come.
2. "Cold and indifferent Xiang Yunlue":
"Continue to focus on the cycle, with ships as the main warehouse, machinery and small metals as the secondary warehouse, and semiconductors as a small warehouse to complete the business."
"For the shipping industry, even when exchange rates fluctuate slightly, forward foreign exchange settlements and sales are often used to lock in exchange costs (and benefits). This is a very basic operation, let alone the current large fluctuations in exchange rates. Rather than worrying about the impact of exchange rates on profits, it is better to reassess the probability of a global economic recession."
Well, in a bear market, you should choose good future investment targets, hold them for a long time and wait for the bull market to come.
It is not impossible that the global economy will decline in the future.
So, some time ago, after thinking about it several times, I made some adjustments to my portfolio.
After reluctantly giving up Hitech, some chose smart cars mainly for the domestic market, and some chose bulk nonferrous metals during the period of high inflation.
The overall holdings have been hedged.
——————
Now is the worst time, because there are ghost stories everywhere and no hope in sight.
Now is the best moment. There is gold everywhere. You can pick it up bit by bit calmly and wait for it to shine in the future.
Fellow investors, hold on and don’t fall before dawn.
Continue read on readnovelmtl.com
