Monday surged, Tuesday plummeted—this volatility, I mentioned it before the Dragon Boat Festival

Just after the Dragon Boat Festival, the market gave us a vivid lesson in volatility over just two trading days.

On Monday, hardware tech stocks went on a frenzy. Zhipu surged over 42% intraday, reaching a high of HKD 2980, with its market cap exceeding HKD 1.27 trillion. Over in the US, Micron rose nearly 5% in pre-market trading, hitting another all-time high, while SanDisk surged over 5%. The entire AI hardware sector charged upwards like it was on steroids.

On Tuesday, the mood shifted dramatically. South Korea's KOSPI index closed down 9.99%, triggering a circuit breaker intraday; Samsung Electronics fell over 11%, and SK Hynix fell over 11%. Global markets followed suit—the Nasdaq fell 1.32% on Monday, and Hong Kong's Zhipu fell over 11% on Tuesday, its market cap dropping below HKD 1 trillion. Many of the stocks that soared on Monday gave back most of their gains on Tuesday.

Honestly, seeing this made me quite happy.

Not because the market fell, but because I had already posted before the Dragon Boat Festival warning everyone that volatility would increase significantly. At that time, almost all bloggers were saying "June's risks are over, now it's all about earnings," but I repeatedly reminded everyone—the volatility was just beginning.

Monday's surge and Tuesday's plunge played out exactly as I predicted. The feeling of "seeing the risk ahead of time and calling it out" is exhilarating.

So why the drop on Tuesday? I believe the core reason is one thing: Micron's earnings report is coming up.

Micron is scheduled to release its Q3 FY2026 earnings after the US market closes this Wednesday (June 25th). Its stock has already risen over 260% this year and more than 8-fold in the past year. There's too much profit-taking pressure built up in memory stocks. Ahead of the earnings, funds are afraid of "buy the rumor, sell the news" or a disappointing report, so they're taking profits off the table.

South Korean stocks are heavily weighted towards memory stocks—Samsung Electronics and SK Hynix are absolute heavyweights in the KOSPI. When funds pulled out, the Korean market plummeted, triggering the circuit breaker. The Korean crash then spread sentiment to US and Hong Kong markets through global interconnectedness.

This is the chain of volatility transmission: concerns in one industry → a country's stock market → a global chain reaction.

What to do next? I've summarized two strategies, both of which are correct.

First: Selling during Monday's surge. This was the right move. Taking profits is never wrong. You can always find another opportunity to re-enter, or wait for a confirmed uptrend before jumping back in. Not trying to catch the last penny is a form of wisdom.

Second: Holding and doing nothing. This is also correct. Volatility doesn't change the long-term uptrend. As long as your investment thesis remains unchanged, just hold and wait for the stock price to rise later. Not being scared off by short-term volatility is also a form of wisdom.

Both strategies are right. The key is whether you've thought clearly in advance about what you want.

Finally, three points of judgment:

First, long-term bullish view, thesis unchanged. The supply-demand gap, technological barriers, and pricing power in AI hardware—these fundamentals haven't changed at all.

Second, impossible to judge how long the short-term recovery will take. Never try to predict the short term in the stock market—you can never guess what news will come out tomorrow or how funds will play the game.

Third, we only look at whether the logic is right. If the logic is right, volatility is just part of the process; if the logic is wrong, both gains and losses are traps.

Monday's surge and Tuesday's plunge—I talked about this volatility before the Dragon Boat Festival. There will be more to come, but as long as you're mentally prepared, it can't hurt you.

$Micron Tech(MU.US) $KNOWLEDGE ATLAS(02513.HK) $XL2CSOPHYNIX(07709.HK)