Let's talk again about grouping and rotation

After these days of market fluctuations, we can see that this kind of chaotic rotation in the market is like a fan. I believe many short-term traders will be dumbfounded!

First and foremost principle: in a weak market, do not trade!
Not trading means you won’t get hurt, right? Less loss means more profit; minimizing losses is also a way to make more money. Position sizing is also an art!

Now, let’s talk about rotation.
Every day is different. If you insist on trading, try to focus on the strongest sector of the day! Picking stocks from the top sector will always be profitable the next day! For example:
Monday, Power
Tuesday, Commercial Aerospace
Wednesday, Photovoltaics
It might seem like those who traded photovoltaics yesterday lost out, but remember, patterns allow for exceptions. If the strongest sector takes a hit, others will too—at worst, it’s just bad luck!

Secondly, I believe that in the first half-hour of the market open, you cannot accurately determine the strongest sector of the day. After half an hour, you are more likely to identify the trend. To avoid missing out, I think a safer approach is to find the core stocks within the strongest sector to buy low and hit the board!
Because the core stocks are always involved in every major sector breakout. This requires accumulated experience and memory! Stick to the fundamentals and innovate within them—sticking to the core stocks is key!
Otherwise, you won’t know where the breakout will come from. Only the core stocks are the most familiar partners. Trading familiar stocks can minimize the risk of losses.
For example:
On Monday, in Power, we trade Zhongchao Holdings
On Tuesday, in Commercial Aerospace, we trade Aerospace Development
In Photovoltaics, we trade TCL Zhonghuan
You’ll find that the next day, you can trade with ease and confidence, at worst not losing money!
Because small stocks go through a fierce competition for leadership, with intense battles—chaos everywhere. The core stocks are only one, and no one can compete with them!

Second, grouping together.
Day 1: Collective rally, all kinds of stocks surge.

Day 2: Differentiation, leading stocks advance while laggards fall behind.

Day 3: Leading stocks form groups, boosting each other!

Day 4: Leading stocks weaken, following the trend with widespread buy-ins.

Day 5: Weak stocks become even weaker, panic ensues!

We observe that after the initial resonance of sector breakout, the subsequent trend is dominated by leaders, core stocks, and group trading!

Grouping doesn’t guarantee profits, but not grouping usually results in losses!

The biggest difference between leaders and followers is grouping!
Followers tend to be day traders because they can’t group!
Leaders can run the whole show because of grouping—everyone contributing makes the fire burn higher!
Grouping is the main reason for resisting declines during divergences.
Grouping is the continuous source of momentum and vitality.
Grouping represents internal liquidity, independent of the overall market or sector-wide explosions. It’s a result of independent movement!
Only through grouping can we achieve unexpected results!
Grouping is popularity; grouping is the people’s favorite!
Grouping is longevity.
Solid grouping is like an unbreakable fortress; stars are fleeting!
Grouping is the best friend who stays with us for a lifetime. Other friends are just companions for a short while!

You will find that stocks in a group are always visible on the popularity list!