August thirteenth, two thousand twenty-five
《The Stability Window: Strategies for Action》
“The Stability Window and Strategies for Responding”
The situation in Russia is turning more optimistic, and U.S.–China tariffs have been extended again, As far as the eye can see, the path is almost entirely smooth until October; this decline in global uncertainty has brought another round of safe-haven trading:
Chart: VIX fell to a multi-month low after yesterday’s U.S. inflation data
During this period,
1. Gold’s advance is facing persistent resistance, Even creating potential downside risk, making pullbacks from highs the preferred trade structure:
Chart: Gold is unlikely to make a meaningful breakout
Chart: The strong demand during the Asian session has also disappeared
2. The same pressure is also affecting the Swiss franc:
Chart: Despite the downside pressure from 9 rate cuts, USD/CHF still finds it difficult to break lower
3. U.S. stocks keep reaching new highs, but at the index level, the risk-reward ratio for entering the market is no longer attractive.However, the combination of choppy action near the top and safe-haven trading means that individual securities in the market still have a relatively high probability of a confirmed breakout, but Speculative positions are no longer suitable for long-term holding; we will take profits on our own momentum portfolio as prices rise.
Chart: The dollar index at a new high, with a relatively stable backdrop, The probability of breakouts among individual securities remains relatively high, but the indices are no longer within striking range
The potential rate cut in September may mark the beginning of a prolonged weakening in the market, while the real downturn will occur toward year-end in 10/11.
4. By comparison, Asian markets offer a better opportunity to take a position.Since we published our analysis on the platform and entered the market, the Japanese and Chinese markets have officially begun a new leg higher, The sustainability of this advance is far stronger than that of the U.S. market, and the continued expansion of unrealized gains on our positions is validating and reinforcing our view:
Chart: The TOPIX is strong
Chart: Volatility in Nikkei futures continues to expand
Since the weekly chart of the Shanghai Composite 50 that we follow moved above 2760, the Chinese market has continued to climb to this day:
Chart: The Shanghai and Shenzhen markets are confirming each other
Behind the prices is a recovery in risk appetite. Margin-financing balances have exceeded RMB 2 trillion, the first time since China’s previous liquidity-driven bull market in 2015 7:
Chart: Margin-financing balances have exceeded RMB 2 trillion
Chart: By contrast, the national team’s operations have been relatively subdued, indicating that this market rally is mainly driven by genuine demand for funds
Chart: Turnover reached 2.1 trillion yuan, its highest level since 2, and average monthly turnover in A-shares is on track to rise for a third consecutive month
The trend in the Shanghai Composite 50 remains our main focus but when it comes to positions, we will selectively enter small- and mid-cap names in the market that are more sensitive to risk, because with the major indices stable and risk appetite and fund flows providing additional support, small-cap indices will have substantial room to rise with greater amplitude...
This is the core strategy for the coming period: simply put, watch 50, trade 500/1000.
For now, we plan to take profits when the pricing of 50 indices and that of small- and mid-caps no longer confirm each other,
Specifically, if the former can hold above the level on a weekly basis, small- and mid-caps will continue to offer room for entry until a significant divergence in their gains or losses emerges..
We ask the traders in our own trading room to publish roughly every 2 days a single-market note covering U.S. stocks, mainland and Hong Kong markets, and commodities. We will select the better ones for the corresponding small planets (some also include our own commentary, with identifying details removed).
Those interested can subscribe as needed (subscribe only if you need it; don’t waste your money):
U.S. stocks:https://www.meridianresearch.app/home?product=us-strategies(Xingzhi)
A-shares and Hong Kong:https://www.meridianresearch.app/home?product=asia-strategies(Ganglong)
Commodities:https://www.meridianresearch.app/home?product=commodity-strategies(Dixin)
Regarding the level of detail, we will probably get down to the industry level. For mainland China, we will try to avoid crowded trades; if we write too specifically, someone may jump in ahead of us. We may be able to be more specific about U.S. stocks, but you will still need to think through and fill in the details yourself, There are no trades that can be followed directly!。
The overall win rate has been pretty good recently.
We don’t know whether everyone likes this new format for Notes. If you think there’s a better approach, leave us a like to let us know. We’ll decide based on future feedback whether to continue with this content or return to the previous column format.
Wishing you all the best.
2025.08.13
Note: All content in this article is for reference only and does not constitute investment advice, nor does it serve as a basis for any laws, regulations, or regulatory policies. Investors should not use or rely on this information as a basis for their decisions.