Surging AI computing power demand ignites optical communication, with Changfei benefiting strongly from the dividend.

The Hong Kong-listed optical communication sector performed impressively, becoming a market focal point. As of March 10, 2026, Yangtze Optical Fiber and Cable (06869) closed at 269.7 yuan, surging 19.34%, with a trading volume reaching 5.198 billion yuan. The five-day volatility was as high as 29.4%, showing strong upward momentum in stock price. In terms of market news, the optical communication sector collectively soared, with ConvergeTech (01729). $TIME INTERCON (01729.HK)$ rising over 9%, and Cambridge Technologies (06166) $CIG (06166.HK)$ increasing nearly 10.26%.

In terms of news, the 2026 Optical Fiber Communication Conference and Exhibition (OFC) will be held in Los Angeles, USA, from March 15 to 19. This is the top event in the global optical communication and networking field. The conference focuses on three cutting-edge areas: AI-driven data center network architecture, ultra-low latency transmission technology using hollow-core optical fibers, and inter-satellite laser communication systems. It has attracted global tech giants such as Huawei, ZTE, and NVIDIA to participate. Additionally, NVIDIA recently announced multi-year strategic partnerships with optical communication leaders Lumentum and Coherent, investing $2 billion each in advanced optical technology R&D and manufacturing to further strengthen the underlying connectivity capabilities of AI infrastructure. In terms of domestic policies, China’s National Development and Reform Commission explicitly plans to promote the construction of 'six networks' including computing power networks and key areas under the "Artificial Intelligence+" initiative, with an estimated investment this year exceeding 7 trillion yuan.

From a technical trend analysis, Changfei's stock price shows a strong breakout pattern. According to technical data as of March 10, the stock price at 160.1 yuan has stabilized above the 10-day line (147.63 yuan), 30-day line (112.83 yuan), and 60-day line (81.09 yuan), with moving averages in a bullish arrangement, reflecting strong short-term performance. The Relative Strength Index (RSI) is 65, within the strong zone but not overbought, indicating room for further upside. Notably, multiple indicators like the Stochastic Oscillator and Bollinger Bands are signaling buy opportunities, and the CCI indicator also suggests buying, supporting further upward movement in the stock price. However, the overall signal count indicates a “sell” with strength reaching 10, mainly due to a top divergence signal in the Momentum Oscillator, suggesting possible short-term fluctuations.

In terms of support and resistance levels, the primary current support level is 131.3 yuan, which is a key short-term defense line. If it breaks below this, the next critical support area to watch would be 110.8 yuan. Above, resistances cluster at 175.2 yuan and 202 yuan, with 175.2 yuan being the key target for a short-term breakout. With the latest stock price at 160.1 yuan, it is currently between the support level of 131.3 yuan and the resistance level of 175.2 yuan, making short-term trading suitable by following the trend.

Reviewing the performance of warrant products, the two Changfei call warrants mentioned on March 6 performed notably in capturing the rise of the underlying stock in the subsequent two days. The HSBC call warrant (25353) $HS-YOFC@EC2611B.C (25353.HK)$ recorded a 28% increase over two days after being mentioned, while the underlying stock rose by 15.60% during the same period; the Merrill call warrant (25655) $MS-YOFC@EC2608A.C (25655.HK)$ recorded a 31% gain, with the underlying stock rising by 15.60% in the same period. Both outperformed the underlying stock significantly, showcasing the leverage effect of warrants, with the Merrill call warrant standing out, reflecting its higher sensitivity to underlying stock volatility based on its design.

For warrant product deployment, considering the current support and resistance levels, investors can choose from the following products based on their risk preferences.

On the call warrant side, the J.P. Morgan call warrant (26090) $JP-YOFC@EC2608A.C (26090.HK)$ and the Macquarie call warrant (25978) $MB-YOFC@EC2608B.C (25978.HK)$ have exercise prices of 188.88 yuan and 188.888 yuan respectively, offering leverage of about 2.1 to 2.2 times. These exercise prices are linked to the key resistance levels of 175.2 yuan and 202 yuan, making them suitable for investors expecting the stock price to break through resistance and challenge the 190 yuan mark. The advantage of the J.P. Morgan call warrant (26090) lies in its ideal leverage and implied volatility, making it more attractive for investors seeking amplified effects. Meanwhile, the Macquarie call warrant (25978) offers the lowest premium and implied volatility, providing stronger downside protection for valuation-sensitive investors with manageable time value costs.

Overall, investors optimistic about Changfei Fiber Optic Cable can choose between the two call warrants based on their preferences: those seeking leverage and implied volatility advantages may consider J.P. Morgan’s call warrant (26090), while those focused on cost control might opt for Macquarie’s call warrant (25978).

Interactive Questions:

Dear readers, do you think Changfei Fiber Optic Cable (06869), benefiting from the OFC conference and AI computing power demand, will successfully break through the resistance level at 175.2 yuan in the short term?

A) Yes, with numerous positive catalysts in the industry, the uptrend is likely to continue.

B) No, consolidation near 160 yuan is needed first to digest recent gains.

Feel free to share your thoughts in the comments section!

Friendly Reminder: This article does not constitute any investment advice.

This article is for reference only and does not constitute any investment advice. The market data, opinions, and analysis contained herein may change at any time without prior notice. We are not responsible for any loss or damage caused by reliance on the information in this article. Technical analysis only shows whether certain technical conditions are met; a comprehensive assessment of asset performance should combine other data and should not solely rely on this article to make trading decisions. Please note that past performance is not indicative of future results. Follow Jenny's insights on Hong Kong stock warrants for more professional analysis.

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