SMIC experiences high-level fluctuations, investors start to 'step back' and observe

SMIC's current price is 73.1 yuan, however, the relative strength index is approximately 83.123. Although momentum is very strong, it has entered the overheated zone, and the risk of chasing the price is clearly rising.

Investor comments reflect that market sentiment is not unilaterally optimistic but rather filled with divergence at the highs. On one hand, some investors hope the stock price won’t retreat, while others are paying attention to an obvious attempt to push the closing price higher, indicating that short-term capital still expects the upward trend to continue. On the other hand, more comments focus on profit-taking, distribution, large trades trapping investors, and starting to exit, showing that many investors are becoming cautious about buying at the highs.

The market's common concerns mainly focus on two points: first, whether SMIC still has the strength to challenge 80.100; second, whether a pullback is likely after the current breakout above the upper rail. Technically speaking, 76.377 has shifted from being a resistance level to a short-term watershed. As long as the stock price can stabilize above this level, the breakout pattern remains valid, and there is still a chance to test 80.100 in the short term. However, if 76.377 is breached, one must be cautious of the stock price consolidating around 68.830.

Overall, SMIC's current trend remains relatively strong, but the risk-reward ratio is no longer favorable for entering at a low position. Instead, it leans toward a neutral-high level with rising risks. The short-term key is to hold steady above 76.377; if it holds, the target is 80.100. If it fails to hold, be prepared for a pullback after the breakout.

Market view response:

@Edge Trader: A sharp rebound after a decline reflects high short-term volatility; at this stage, the key is whether 76.377 can hold steady.

@Let's talk about it in ten years.: The relative strength comparison with Hua Hong can be referenced, but SMIC itself has already broken through the upper rail, and technically remains strong.

@Poor Person@可憐人: If there was previously heavy trading volume and no further surge occurs, it indeed easily creates trapped pressure.

@@外星文明概念股投資者: Distribution risks should be noted, especially since the Relative Strength Index (RSI) has now entered the overheated zone.

SMIC (00981) Key Strategy: 76.377 serves as the watershed; holding above it allows for a potential upward test toward 80.100; if it fails, a pullback to consolidate around 68.830 is expected.

Strategy One | Follow the Trend After a Breakout

25682 | Strike Price 80.05 | Actual Leverage 5.8x | Close to current price, highly sensitive to breakouts, suitable for immediate follow-up after a breakout

20113 | Strike Price 80.05 | Actual Leverage 5.9x | Slightly higher leverage, suitable for holding when momentum continues post-breakout

25596 | Strike Price 81.81 | Actual Leverage 5.7x | Slightly out-of-the-money, suitable for trend-following strategies with lower volatility tolerance

$UB-SMIC@EC2607A.C (25682.HK)$$HS-SMIC@EC2607A.C (20113.HK)$$CT-SMIC@EC2608B.C (25596.HK)$

Strategy Two | Buy on Pullback to Support

19350 | Strike Price 69.04 | Actual Leverage 3.9x | In-the-money structure, stable during pullbacks, suitable for accumulation in stages

19562 | Strike Price 68.93 | Actual Leverage 3.6x | Lower leverage, suitable for conservative deployment anticipating a rebound after a pullback

26559 | Strike Price 71 | Actual Leverage 3.7x | Close to support zone, suitable for technical rebound plays but avoiding chasing highs

$UB-SMIC@EC2609A.C (19350.HK)$$UB-SMIC@EC2610A.C (19562.HK)$$BI-SMIC@EC2610D.C (26559.HK)$

Strategy Three | Deployment on Weakness After Losing Key Support

24259 | Strike Price 67 | Actual Leverage 3.6x | Provides flexibility to short after breaking through support

25057 | Strike Price 66.95 | Actual Leverage 3.5x | Volatility is relatively stable, suitable for holding after confirming a weakening trend

28739 | Strike Price 73.81 | Actual Leverage 2.5x | Lower leverage, suitable for more conservative hedging or defensive strategies

$BI-SMIC@EP2611A.P (24259.HK)$$HU-SMIC@EP2611A.P (25057.HK)$$HS-SMIC@EP2611B.P (28739.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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