At the end of January, in fact, the holding strategy for February had already been formulated.
At the beginning of February, the position was fully loaded, and then the account was closed, waiting for the arrival of March.
Lie flat for a month, do not rashly adjust the position, quietly waiting for time to bring the market repair.
Many people may be curious, why choose to lie flat in February, what is the basis for judgment?
First, let's talk about the basis for judgment, and then talk about why to do this.
1. At the end of January, it is a period of panic accumulation.
There are many ways to see the stage bottom.
One is to grind out the bottom slowly, and the other is to use panic to kill the bottom.
If the six consecutive negative lines of the monthly line are grinding the bottom, then the killing at the end of the six consecutive negative lines is killing panic.
In the final analysis, it is for some bloody chips, nothing else.It has been repeatedly mentioned before that once the market enters a period of panic and accelerates its decline, it indicates that the bottom is not far away.
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The "not far away" here does not only refer to the index point but also to the time, usually around 5-8 trading days.
During the period of panic accumulation, it is the easiest to bring out panic and cut-loss positions, and in fact, rational investors understand this, but the vast majority of people are not rational.
Of course, there are also some positions that are passively closed out, with no way to avoid it, and can only be forcibly sold.
This stage is the darkest darkness before dawn, and after enduring it, a sunrise awaits.
2. February is an important turning point.
Many people do not understand why February is an important turning point.
But in fact, everything has been arranged like a script in advance.
The dense release of good news brings about changes in the time window, and a large amount of accumulated news, from quantitative change to qualitative change.
You think these news are temporarily introduced, but in fact, they have been brewing for several months.When the index falls to a certain depth, meeting the market space, what should ferment will ferment.
At the same time, whether it is from a daily, weekly, or monthly perspective, the index has a resonance effect for a rebound in various cycle spaces.
The continuous bearish lines have created an oversold situation, which converges at the time points of the three cycles, and must bring a full release of emotions.
Especially for blue-chip broad-based indices like the CSI 300, with four consecutive bearish lines in the annual line, four consecutive bearish lines in the quarterly line, and six consecutive bearish lines in the monthly line, technical expectations, coupled with the release of emotions, must have a round of repairs.
3. February is a performance vacuum period.
The end of January is the time with the most bearish news, because the end of January is when the annual report preview needs to be announced.
That is, a large number of listed companies with significant losses and expected reductions will announce performance previews in advance.
This is equivalent to a large number of mines that need to be released in advance.
The next time should be in mid-to-late April, when there will be a large-scale disclosure of first-quarter performance reports.
Not all market funds have a full understanding of the performance of individual stocks, which makes a lot of funds hesitate at these sensitive time nodes.February, as a vacuum period for performance, creates a very good breeding ground for the market.
Why there were so many speculative stocks in the fourth quarter of last year is actually also due to the capital effect brought by the vacuum period of performance.
4. The economic data in February is good.
The last point is that the economic data of January was predicted in advance, and it will have a very satisfactory answer sheet.
The most important data is the social financing data, and the increase in mortgage loans will reach a new level.
These data may have been seen by everyone in the middle of February, but in fact, the major banks all knew the situation in January.
This is also why retail investors choose to panic and sell, sell, sell, but there are actually mysterious funds buying, buying, buying, everyone's access to information is completely different, and the data and the real situation are different.
Many people are a bit too pessimistic about 2024.
Perhaps small and medium-sized science and technology innovation enterprises are really a bit difficult, but for those large blue-chip state-owned enterprises, at most the growth rate of performance will slow down, and there will be no obvious decline, which can be put at ease.
The opportunities and challenges this year, the macro difficulties may not be as great as in 2023, but the listed companies on the micro level are still full of thorns.So, this point in time has actually been predetermined, and no matter how pessimistic the market is, it must usher in a period of repair and respite in February.
If we were to consider the length of this adjustment cycle, this respite period should last for at least more than two months, or it could be around 40 to 50 trading days.
Let's talk about why February is the time to lie flat.
After all, many people would think that when the market comes, they need to seize the time to act, find direction, find a way out, and find the biggest opportunity to make money in the market.
There are several reasons why I advise everyone to lie flat.
1. The market is in its initial chaos, and there is no real main line.
Everyone is looking for the main line, but in fact, the main line of the market is repair.
Many indices have fallen for a year, and the least have been adjusted for at least half a year, all of which need to be repaired.
The blue-chip stocks that were adjusted the earliest started in February 2021, and it has been a full three years.All of this implies that the main theme in February is actually repair, not hot spots.
This is a node where chaos begins to clear up, which is the process of shifting from a downward trend to a brief upturn.
The market currently does not have a true emotional main line to drive the market trend, that is, there is no absolute hot spot.
This hot spot may emerge under the stimulation of some important meetings in March, or some new hot spots and policies.
Therefore, in February, there is no need to rush to find any main line, and most of the time can be used for recuperation and rest, as long as the index's corrective trend is grasped.
2. Bottom rotation, retail investors can't keep up with the market rhythm.
Because the market's current sentiment needs to be repaired, the market will show a rapid rotation.
On the first day of the rebound, the main direction of the market is the GEM and the Science and Technology Innovation Board, with underlying areas such as medical care, photovoltaics, chips, and so on.
On the second day of the rebound, most of the market's sectors have risen, including military, energy metals, and so on.
On the third day of the rebound, the micro-cap stocks that have been in panic, that is, small and medium-sized market value stocks, also began to rebound significantly.The market rotation is very fast because the stocks in the market are all very cheap, and the capital is buying and buying, and the emotions are also being released in large amounts.
Ordinary retail investors are completely unable to keep up with the market rhythm, and it is very easy to chase the rise and kill the fall, which is more likely to bring losses.
3. There is still lingering fear and it takes time to repair emotions.
Great sorrow and great joy are actually very uncomfortable.
Many retail investors have just experienced the haze, and now they are full of hope.
But in fact, trading needs to be done in a calm emotional state.
The emotional fluctuation is too large, and being overly optimistic and pessimistic are not conducive to our trading, and it is very easy to make major mistakes.
So, in February, this time point, just add the New Year, should be a good time to sort out emotions and repair mentality, instead of being in a hurry to choose stocks and trade.
After February, when the situation in March is clearer, there will definitely be more opportunities, and there will also be more market differentiation. It is the best strategy to make arrangements at this time point.
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