#2024.10.21 Morning Trading Strategy# The market regained confidence after Friday's big rally, and the weekend news was generally positive. The management's attitude towards the market remains "protective."

Therefore, the rally will continue, but not in the frenzied pre-holiday style. A slow bull market is what the management hopes for.

The index is still fluctuating within a range. There is a large amount of trapped positions near the 3674 high, so the probability of a direct breakout is not very high.

In terms of trading strategy, treat it as a range-bound market. If there is another surge this morning, consider reducing some positions and focus on buying low and selling high.

Now, let’s look at sectors and stocks:

1. Big Tech

Last Friday, tech stocks, especially in the semiconductor and chip sectors, almost all surged. Those that should have risen already did. Today is the day after the rally, so divergence is likely.

The core leader in semiconductors and chips is: SMIC (00981.HK). This stock is the absolute benchmark for the sector, reflecting the sentiment of chip stocks. Observe its movement today.

After a surge, focus on the core stocks. If even the core stocks underperform, don’t consider chasing laggards.

2. Low-Altitude Economy / Defense

News highlights:

👉 Suzhou released trial measures for low-altitude flight service management, effective December 1;

👉 Hong Kong’s low-altitude economy working group plans to hold its first meeting next month, with pilot projects accepting applications by year-end;

👉 Beijing is planning a 3,000-square-kilometer autonomous driving demonstration zone.

From a sector perspective, low-altitude economy (still at low levels) combined with commercial aerospace, as well as some defense stocks, could see a rebound if tech stocks diverge today. Funds might flow into low-altitude or defense for rotation.

3. AI Industry Chain

This sector mainly benefits from the weekend hype around NVIDIA’s concept. Its stock price, earnings, and orders are all hitting new highs, directly benefiting the entire AI industry chain.

The AI industry chain includes themes like computing power, CPO, PCB, and high-speed copper cable connections, all of which rallied last Friday.

In NVIDIA’s GB200 industry chain, the high-speed copper cable connection concept benefits from both GB200 and the 910c chip, making it the strongest-performing branch. Keep an eye on it.

PCB/CPO, relatively speaking, are lagging branches in this wave of NVIDIA’s GB200 industry chain. With New Essex releasing positive news over the weekend, the CPO branch might also see a catch-up rally.