CATL holds above the critical level of 668, with some support for the rebound, but it is not yet at the stage for blind buying.

CATL is currently trading at 662 yuan, with a slight improvement in the short-term structure but has yet to officially turn bullish. The stock price is above the 10-day moving average of 659.200 and the 30-day moving average of 656.413, indicating that there is some support for the rebound after the pullback from the highs. However, the current price is only slightly above the pivot point, and there is still a distance to a strong breakout. The upper Bollinger Band at 737.246 is the next key resistance level.

The most critical level right now is 668.66. As long as CATL can hold above this level, the short-term rebound structure can be maintained, with the next target being 737.24. However, if it falls below 668.66, the stock price will return to weaker consolidation, with the first support levels being 659.200 and 656.413. In other words, the area around 669 is not a place where one can fully relax; it's just a position that has returned to the pivot point and needs further confirmation.

In terms of trading volume, the latest bar shows a noticeable increase in volume, coinciding with the rise in stock price, which is a positive signal. It reflects that this rebound is not a volume-less spike, but rather involves renewed capital participation. However, a volume-supported rebound only indicates improved support and doesn't mean a one-way upward trend can be assumed. To confirm that the rebound has evolved into a strong uptrend, the stock price needs to consistently hold above 668.662 and gradually advance towards 737.246.

The Relative Strength Index (RSI) is approximately 56.248, which is neutral-leaning strong. Momentum has improved, but it does not indicate a strong breakout. This state typically means that the stock price has the ability to recover, but still requires time to establish a clearer direction. If investors chase highs too early here, they may easily encounter repeated fluctuations near the critical level; if they turn bearish too early, they may also get caught in the volume-supported rebound.

Among investor comments, bullish voices are mainly concentrated around phrases like 'going long is more profitable than going short,' 'gradual rise,' 'good things coming soon,' and 'king of stocks.' This reflects that the market still has strong faith in CATL, especially as the industry leader, making it easier for investors to turn optimistic again after a pullback. This view is not entirely baseless, as the stock price has returned above key short-term moving averages with supportive trading volume. However, the issue is that at this stage, the rebound structure has only slightly improved and hasn't broken through 737.246; therefore, it should not be considered as having fully regained strength.

Bearish comments focus on 'head and shoulders top' and 'going all-in short.' These views reflect lingering caution in the market about a pullback from highs. However, to use the head and shoulders top as a judgment criterion, critical support levels must be breached. Currently, the stock price remains near 668.662 without clear breakdown signals. As for going all-in short, the risk is even higher because current trading volume supports an upward move, and the stock price has returned above its midpoint. Heavily betting against the trend at this position is not ideal.

Observation-focused comments actually best reflect the current situation. Questions like 'What's a good entry point?' 'It rises every day, but I can't get in,' and 'Where is the profit-taking level?' indicate that the market is starting to refocus on entry points and profit-locking positions. For those not yet holding the stock, near 669 is not the most comfortable entry point since the stock price has just moved above 668.662 and needs confirmation of stability. A more reasonable approach is to wait for a pullback that doesn’t break below 668.662 or for the price to continue rising with confirmed support. For existing holders, if 668.662 holds, they can continue targeting 737.246; if the price falls back below 668.662 in the short term, expectations for a continued rebound should be lowered.

Overall, CATL’s current situation reflects an improved rebound but not a completed breakout. The 668.662 level is the short-term lifeline, 737.246 is the upside target, and 659.200 and 656.413 are downside support levels. As long as 668.662 holds, the short-term bias can remain slightly bullish; however, if it breaks down, this rebound will revert to a typical retracement following a peak decline.

The most suitable strategy at this stage is to lean bullish but avoid chasing aggressively. Bulls should set defensive lines, while bears should wait for breakdowns. The biggest mistake the market could make now is blindly jumping in due to CATL’s leading status or going all-in short because of fears of a pullback from highs. The actual trading boundary is simple: hold above 668.662, and the rebound continues; break below 668.662, and first look toward 659.200 and 656.413.

Key points for CATL (03750): The current price of 669.000 is holding just above the pivotal level of 668.662. If it holds steady, the initial target would be 737.246. A break above 737.246 would improve the rebound structure further, but if it falls below 668.662, expect potential tests of the support levels at 659.200 and 656.413.

Strategy 1: Hold above 668.662, then target 737.246

27016 | Strike Price 668.5 | Actual Leverage 5.3x | Strike price close to the current price; suitable for capturing the first phase of the rebound if the stock price stays above the pivot point, with direct reaction.

26770 | Strike Price 668 | Actual Leverage 4.6x | Close to the current price but with milder leverage, suitable for those who are optimistic about the rebound but prefer a less aggressive approach.

15872 | Strike Price 629.38 | Actual Leverage 4.6x | Deeper in-the-money, suitable for those who want to follow the underlying stock's movement rather than purely chasing high elasticity.

$HU-CATL@EC2609A.C (27016.HK)$$BP-CATL@EC2610A.C (26770.HK)$

Strategy Two | Pursue rebound extension after breaking through 737.246

28459 | Strike price 799.5 | Actual leverage 4.7x | Strike price above upper resistance, suitable for pursuing rebound extension after breaking through 737.246, with greater emphasis on trend confirmation.

28251 | Strike price 788.5 | Actual leverage 4.8x | Moderately distanced strike price, suitable for capturing the second wave of upward movement after a breakout, balancing flexibility and distance.

27566 | Strike price 830.5 | Actual leverage 3.6x | Further out-of-the-money but with moderate leverage, suitable for a bullish outlook expecting continuation after breaking through 737.246.

$UB-CATL@EC2612A.C (28459.HK)$$HU-CATL@EC2612B.C (28251.HK)$$UB-CATL@EC2704A.C (27566.HK)$

Strategy Three | Guard against retracement to 659.200 and 656.413 after falling below 668.662

27504 | Strike price 551.38 | Actual leverage 2.8x | Medium-to-long-term downside protection, suitable for conservative bearish positioning after breaking the watershed, though not ideal for short-term high volatility.

27083 | Strike price 550.88 | Actual leverage 2.5x | Lower leverage, suitable for defensive bearish strategies, better suited for holding over time once weakness is confirmed.

27369 | Strike price 515.05 | Actual leverage 2.8x | Lower strike price, suitable for bearish extension towards deeper support zones, representing a more aggressive downside strategy.

$HS-CATL@EP2703A.P (27504.HK)$$UB-CATL@EP2703A.P (27083.HK)$$CI-CATL@EP2704A.P (27369.HK)$

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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