Rebound Market Enters Differentiation Phase! Short-Term Trading Offers Highest Win Rate Amid Shrinking Volume, Two Major Strong Sectors Show 'Second Buy Point'!

International stock markets rebounded as U.S. Treasury yields declined, prompting Taiwan's weighted index to seek stable support. However, with trading volume shrinking and the market stuck in a range-bound pattern, directionality has fragmented, marking the onset of a differentiation phase. At this stage, maintaining a neutral holding level while applying low-entry, high-exit short-term trading strategies is the key to success.

Range-Bound Pattern Continues – 45,000 Level Must Be Secured Quickly

Spurred by news from the U.S. Treasury hinting at bond purchases and easing pressure on long-term government bond yields, Taiwan's market briefly reached 45,160 points during the session. However, profit-taking triggered a pullback, though late-session buying helped close the index at 44,933 points. Trading volume shrank to approximately NT$793 billion, remaining below the monthly average. From an options perspective, the near-month put-call ratio has risen back above 1. The index must quickly stabilize above 45,000 points to confirm solid support strength.

Cooling Sector Pullback Isn't Negative – Capital Re-concentrates in Optical Communications

The cooling sector previously saw significant gains, so a short-term pullback represents normal position rotation. As long as the industry trend remains unchanged, retracements to find support actually present opportunities to reassess entry points. This is why when Quanta (3017-TW) rose sharply, Instructor Chen Zhi-Lin first guided members to rebalance positions. After a rally, retesting support becomes a crucial moment to observe re-entry timing. Meanwhile, optical communications stocks saw capital re-concentrate late in the session. Kingsion (6442-TW) and Walsin Opto (4979-TW) outperformed the broader market, indicating that optical communications remain a sector with relatively high investor conviction. As the market diverges, not all stocks will rise together—stock selection is now more critical than guessing index movements.

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Wait for Mainstream Stocks to Present Entry Points Until Volume Expands

The supply chain related to TSMC (2330-TW), after a period of low-volume consolidation, appears relatively flat in the short term. Yet precisely because the market isn’t intensely pursuing these names now, they retain a safe margin for medium-to-long-term accumulation at lower levels. Currently, multiple quantitative indicators and market breadth remain in neutral territory. Until trading volume clearly expands with directional momentum, it’s not yet time to aggressively chase prices across the board. For now, the market features low volume, range-bound action, and sector rotation—buy low, sell high, avoid chasing rallies. Prioritize leading industries firmly above their monthly and quarterly moving averages, continuously monitor when volume resumes expansion, and then increase aggressive positioning. Investors are invited to download the [Chen Zhi-Lin Analyst App], where real-time updates are shared instantly. Use data to master market rhythm, and each week’s updated credit margin risk list helps you avoid risks and seize opportunities.

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Source: Chen Zhi-Lin Analyst / Kaixu Investment Consulting

No improper financial interests exist regarding individual securities recommended or analyzed by our company. Past performance does not guarantee future profits. Investors should make independent judgments, conduct careful evaluations, and assume investment risks accordingly.