1. Interpretation of Central Bank Bond Purchases
The initial 400 billion was a rollover, hence there is no new injection of funds.
However, the central bank’s direct bond purchases break with convention and are interpreted by the market as a prelude to unlimited QE in the future.
This action bypasses commercial banks, leading to adjustments in bank stocks.
The market, which had a tumultuous end in August, welcomed a rebound, compounded by the central bank’s actions, leading to a post-compression rebound in the market.
Furthermore, the appreciation of the offshore RMB and expectations of a Fed rate cut in September.
Technically, it aligns with the characteristics of a weekly rebound.
Thus, it can be qualified that the market has entered a weekly rebound phase.
2. Rebound, Not Reversal
Before the market’s Q3 reports, a rebound cycle is anticipated.
This was the qualitative analysis I made in my article yesterday on Xingqiu.
However, it is a rebound, not a reversal.
Moreover, the real driving forces behind this are quite limited, and the height of the rebound is also quite limited.
It can only be said that the market needs a rebound, and it is time for a rebound.
3. U.S. Stocks
The risk of yen interest rate hikes.
Whether the Fed can confirm a rate cut.
The uncertainty of the election.
The direction of the war.
Nvidia’s earnings guidance fell short of expectations.
The same formula was enacted two months ago.
Therefore, U.S. stocks are under certain rebound pressure.
But after a round of impact, the pressure has obviously decreased.
4. Corresponding Strategy
If U.S. stocks have an adjustment.
Then increase the allocation, focusing on U.S. pharmaceuticals and the S&P.
The domestic market can participate in the rebound, but do not treat it as value investment or a reversal; a 20% return is quite good.
There was one in the first half of the year and one in the second half; it’s not bad to operate on it.
Yesterday and today were general rises, betting on good news over the weekend, and differentiation will begin next Monday.
This round of rebound is weaker and has poorer logic compared to February of this year.
But the rebound structure exists.
There will be another confirmation next week. It can basically be confirmed that the weekly rebound has begun.
5. New Cycle
Macro, logic, meso-industry, fundamentals, and technical framework.
Follow the market rhythm, with overseas markets, crypto markets, and U.S. stocks as the core.
Domestically, engage in speculation, and it is basically possible to achieve good returns in this bull market.
Since 2023, with U.S. stocks, gold, and Bingyi as the core of the global strategy, supplemented by A-shares to seize one to two speculative opportunities throughout the year.
The profit cushion of the new cycle bull market is already quite thick.
It is expected that the global market will enter the second half of the bull market in the fourth quarter of 2024.
Macro and logic serve as the main qualitative framework, which can be used as a base, without unnecessary fuss in the market.
The qualitative analysis made at the end of July was that August was the most difficult month.
With the end of performance disclosure at the end of August, and looking at the trend of these two days before the Q3 report, the market is establishing a wave of weekly rebound, which is operable.
It is expected that differentiation will occur next week, and then confirmation will be made.
There will be qualitative analysis at key nodes.
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