Buffalo has its own way of playing, don't rush to get off the ride yet!

At 9:30 AM today, the A-share market indeed made history.

However, this historic moment lasted only a few minutes before the market opened high and closed low. The Shanghai Composite Index (SSE) surged to the daily limit at the opening but later dropped to a mere 1.1% gain. Brother Cai almost liquidated his positions (more on that later).

As for individual stocks, many of the thousands that hit the daily limit early on later plunged, with some even turning red by the close.

Meanwhile, the Hong Kong market was a living hell today. The Hang Seng Index plummeted 9.4%, while the Hang Seng Tech Index crashed nearly 13%. Most stocks that performed strongly during the National Day holiday saw declines of at least 20%.

Brother Cai remains nearly fully invested in A-shares and didn’t reduce his positions today, though he came close. Despite the pullback, most A-share accounts are still in the green.

As for his Hong Kong portfolio, Brother Cai gradually trimmed some non-core holdings during the National Day holiday, reducing his total exposure by about 30% (the specific stocks were disclosed in real-time within his circle).

.........

After today’s performance in both Hong Kong and A-shares, the once-unshakable consensus about a bull market seems to be wavering.

Brother Cai has consistently argued that this rally isn’t a true bull market, as detailed in his September 26 article "Is the Bull Market Really Here?"

He bases this view on three key conditions:

① A true A-share bull market begins amid skepticism, not unanimous optimism.

Only in Phase 2 of a bull market does the rally gain broad consensus.

But Phase 2 is characterized by: the index having already risen significantly, and the market’s driving force shifting from existing capital to retail investors—think grandma investors.

Phase 2 belongs to the grandmas.

Right now, they’re probably still buying gold.

② A-share bull markets don’t emerge alongside policy announcements but at least 1.5 months after.

With policymakers just starting to talk, when has a bull market ever coincided with the rhetoric?

③ Bull markets don’t thrive with multiple gaps in the charts.

Currently, the SSE, ChiNext, and Shenzhen indices all have upward gaps.

Strictly speaking, only Condition ① aligns with this rally (market consensus), while Conditions ② and ③ diverge significantly.

For a real bull market, focus on Conditions ② and ③: it never takes off simultaneously with policy but lags by 1-6 months.

Also, per Condition ③, a real bull market doesn’t have clusters of upward gaps below.

Thus, this is NOT a real bull market!!!

So, if not a bull market, what is it?

Refer to Brother Cai’s September 30 article "Either Soar or Die on the Spot!"

There, he first proposed that this rally is at best a "liquidity-driven bull" (水牛).

What’s a liquidity-driven bull? It’s a fast-moving, short-lived rebound with bigger gains than usual.

So, a liquidity-driven bull is just an amplified rebound!!!

Understanding this helps maintain perspective—avoid FOMO and going all-in like some latecomers.

Those who lose money in a "bull" market are either naive investors or overly greedy veterans.

In short: This isn’t a real bull market but a liquidity-driven one.

.......

If you agree with Brother Cai’s "liquidity-driven bull" thesis, here’s the strategy:

Play by its rules—fast in, fast out.

As noted in the September 30 article: Since this rally is driven by sidelined and FOMO capital, watch for two signals—no sharp drop in trading volume + the SSE staying green.

Both must hold simultaneously!

Today, Brother Cai nearly sold because the SSE almost turned red but held on after the rebound.

Today’s action met both criteria, so the liquidity-driven bull persists—don’t exit yet!!!

.........

What about Hong Kong? With today’s crash, is its liquidity-driven bull over?

Look closely: Hong Kong’s plunge merely erased its National Day gains!

If you pretend Hong Kong was closed during the holiday, today’s session would count as a slight uptick—just weaker than A-shares.

Thus, Hong Kong will largely mirror A-shares—if A’s "liquidity-driven bull" continues, so will Hong Kong’s!!!

Brother Cai trimmed Hong Kong positions during the holiday, expecting it wouldn’t outperform A-shares significantly.

$SMIC(00981.HK) $TENCENT(00700.HK) $HKEX(00388.HK) $MEITUAN(03690.HK)

That’s all for today. Hope this helps! I’m Brother Cai, a 财报 enthusiast focused on HK IPO and cross-market (HK-US-A) investing, blending long-term holds with short-term trades. See you next time!