Why Soaring Semiconductor Chips Signal Second Bull Market Wave
Semiconductor chip industry is experiencing a massive boom, and the dark horses' key allocations in the STAR 50, STAR 100, and CSI Data have also reaped substantial gains. The market has seen new changes, and the main theme of the second wave of the bull market has become clear. Let me share with you, my dear followers, the key points for investment in the coming period. The content is very important!
Opportunity Insights and Risk Warnings
Recently, the dark horses have repeatedly emphasized the importance of focusing on the technology track, clearly pointing out that there is a high possibility for the technology track to become the main theme of the second wave of the bull market. Judging from the market movements last week and this week, this forecast is becoming a reality.
We have a medium-term positive outlook on the technology market, but it is important to pay attention to the rhythm. Today's significant rise and subsequent fall indicate pressure from above, suggesting a possibility of a short-term correction and consolidation. It is not necessary to chase the market excessively; it is more appropriate to look for opportunities when the market falls.
While the technology track is booming, banks and securities are weakening, and high-dividend stocks like coal, oil, and electricity are adjusting. This means that the market is undergoing a style shift, transitioning from a dividend-driven market to a technology-driven market. Once the shift is successful, the technology track will continue to be active, while the dividend-driven market will experience periodic fluctuations, and it is advisable to lower expectations.
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1. CSI A50
The CSI A50 is composed of the 50 most representative industry leaders selected from both markets, with a more balanced industry distribution than the SSE 50. The SSE 50 has a high financial sector proportion and is greatly influenced by the banking sector, while the CSI A50 avoids this issue.
The CSI A50 has a higher technology content, with numerous technology leaders such as SMIC, CATL, Mindray, Hengrui Medicine, BYD, and others as its constituent stocks, making its growth potential better than that of the SSE 50 and the CSI 300.
Two possible market trends for the future:One possibility is to form a small double bottom at the 60-minute level, followed by a counterattack to the previous high; another is to move directly upwards in a震荡, challenging the previous high. Both scenarios are possible, and for medium-term dollar-cost averaging (DCA) investments, short-term fluctuations are not of particular concern. The key to the success of DCA lies in perseverance. The bull market is still in its infancy, and it is highly likely that the next one to two years will be within a bull market cycle. The current position is not high and is still in a large bottom area. What needs to be done now is to persist with DCA and exit after the main wave of the bull market has surged.
2. Traditional Chinese Medicine (TCM)
Investment guru Lin Yuan has repeatedly expressed a high regard for the long-term investment value of TCM, and Black Horse agrees with this view. The biggest fundamental for TCM is the aging society that is fully arriving in a large country with a population of 1.4 billion. The number of elderly diseases and chronic diseases such as cardiovascular and cerebrovascular, digestive system, and nervous system will increase. These diseases require long-term medication, such as hypertension and coronary heart disease, which are rarely completely cured and require long-term medication to prevent the condition from worsening. This has turned some TCM into daily consumer goods, and the TCM industry is expected to release a huge market demand over the next one to two decades.
With the continuous increase in residents' income and the continuous strengthening of health concepts, TCM beauty, TCM regulation, and TCM health preservation are gradually becoming new growth poles for the TCM industry.
In the long term, the TCM industry has a good development prospect and huge potential;
In the medium term, the TCM sector is still in a large bottom area, with neither position nor valuation being high, and there is still a good market space.
In the short term, after stepping back to the purple line support and stopping the decline, the next step is expected to be a震荡 upward, once again challenging the pressure at the white line above. Hold firmly and wait for the rise, and continue with weekly DCA.
3. STAR 50 Index
(Note: The term "黑马" was translated as "Black Horse," which is a common way to refer to an underdog or an unexpected winner in English. The term "科创50" was translated as "STAR 50 Index," which is the English name for the Shanghai Stock Exchange Science and Technology Innovation Board 50 Index.)The main theme of the second wave of the bull market has become very clear, just as previously anticipated by the dark horse, big technology has successfully taken the lead. Sub-tracks such as semiconductors, chips, computing power, and data are all soaring, especially the semiconductor chips, which are the strongest, with both soaring by more than 8% during the trading day!
Among the broad-based indices, the one most closely related to the semiconductor chip market is the STAR 50, which also soared by more than 8% today, far exceeding the ChiNext Index. The constituent stocks include well-known industry leaders and specialized giants such as SMIC, Sugon Information, Cambricon, Sino Micro, and澜起 Technology, with high growth potential and great development potential.
In the previous two bull markets, the ChiNext Index, which has outstanding growth, was very popular, with a rise far exceeding the Shanghai Composite Index and the CSI 300 Index. Drawing on the ChiNext market, the STAR 50, which has a higher technological content and more outstanding growth, is expected to become the new star in this bull market, with a great possibility of setting a historical high, and there is still a good market space in the medium term.
Looking at the trend structure, the white line is a strong support, and the blue line is a strong pressure. After stepping back to support, it violently picks up, and it is observed whether it can successfully break through later. If the attack is blocked, there is still a possibility of stepping back to the white line support. Considering that the status of the technology main line is established and the heat is very high, the possibility of breaking through the white line support is relatively small. If it forcibly breaks through, there is a relatively large pressure above, and the possibility of continuous pulling is not very large, and there is a high probability of stepping back to confirm the process.
4. STAR Chip
Chips are an industry that the dark horse has always paid great attention to, with four major investment logics:
First, there is a huge space for domestic replacement. China is the world's largest integrated circuit market, but the domestic replacement rate is very low, only about 25% overall, less than 10% in some areas, and there is twice the growth space from our 75% domestic replacement rate. With more and more core technologies breaking through, the chip industry chain is entering an accelerated development stage.
Second, the industry's fundamentals are warming up. Both the international and domestic markets have shown obvious signs of industry recovery. South Korea's semiconductor chip export data has set records, and domestic industry leaders' performance has surged, with product price increases and full capacity, and it is expected that performance growth will maintain a good momentum in the next one or two years.
Third, the policy side strongly supports it. China's economy is at a critical stage of transformation and upgrading, and the strategy of a strong science and technology country is accelerating. It fully exerts the leading role of science and technology to achieve a real transformation from high-speed development to high-quality development, and from investment-driven to innovation-driven. Therefore, the policy side's support for the technology industry is very strong. The accelerated growth of AI has made the chip industry's story continuous.
Fourth, it is rich in thematic effects and popularity. AI emerged, quickly becoming a hot topic globally and an exciting point in the capital market. In the past year, the global stock market has been focusing on AI, and A-shares are no exception. Today, semiconductor chips have once again become the focus of the market.Based on the above four major logics, Dark Horse believes that there is great potential in the midline of chips, and the market is far from over.
The constituent stocks of the Sci-Tech Chip Index are chip stocks in the Sci-Tech Board, with the maximum increase of 20CM. Last Friday, they surged by more than 14%, and today they surged by more than 11% during the trading day. When there is a market, the explosiveness is very strong.
Today, it encountered resistance from the left high point pressure and fell back after rising. There is a tendency to wash the plate in the short term. After digesting the pressure, the probability of breaking through upward is relatively large. If there is a pullback in the future market, it is an opportunity.
$ Huitianfu SSE Sci-Tech Board Chip Index Initiator C (OTCFUND|020629) $ tracks this index. The preliminary plan is to take the opportunity to absorb at a low level during the pullback and catch a wave of the main rise.
Next, prepare to take the opportunity to absorb at a low level in Hang Seng Technology, Hang Seng Medical, Precision Medical, CSI Data, Sci-Tech 50, and Sci-Tech 100, and prepare to add positions after a pullback. The midline market is very optimistic, but the rhythm cannot be disordered.