AUO Profit-Taking, Acer's Shortage Call and Mid-Autumn Reversal Talk: Responding with Moving-Average Exposure and Defense Points
TL;DR: The Mid-Autumn reversal talk and Acer's shortage call can both be ignored: as long as the 5-day and 10-day moving averages of the broad market stay in bullish alignment, keep exposure above 80% and exit once they break, because individual stocks keep rotating and some stock surges every day, so moving-average exposure and per-stock defense points beat guessing at reversals.
Key ideas
- The speaker took profit on AUO near 20% first, but because volume is large and he does not want to bet against the market, he is willing to buy back on a pullback, even at a higher price; Innolux and Wetek are also named as panel supply-chain stocks to take the baton.
- The Mid-Autumn reversal is a false issue and Acer's shortage call should not matter: only Acer is shouting while vendors with big orders stay quiet, and Jensen Huang has said before to expand capacity as much as possible and sell more; as long as the market's 5-day and 10-day lines are in bullish alignment, keep exposure above 80% and exit only when they break.
- Defense points must advance with the price: a low-priced limit-up stock needs at least 1 wan (ten thousand) lots to be worth watching, first defend the midpoint of the first limit-up candle or the volume candle; after a long red candle, defend its low to trail profits; once a stock turns back and breaks the quarterly or monthly line, run faster, because this rally was pushed up by institutions and they will leave if they do not window-dress.
- With limited funds, high-priced stocks cannot all rise together: turnover is only over 8000 hundred million and not as heavy as last week, institutions prefer high-volume stocks, and high-priced stocks lack retail volume, so they fall fast once someone stops playing; buy when a trend is forming and go with it, and do not catch big limit-down falls.
- You need to understand chip flows and the rules of the game: warrant buyers usually trade short term and block key turning points or attractive technical patterns, so where they bet is worth watching; investment trusts cannot hold more than 20% of a stock, Voltronic is already at 17.17%, and if it goes too high they will take profit, so retail investors should not listen to people saying it is great and not to leave.
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Section summaries
0:05Three Opening Topics and AUO Profit-Taking
The opening raises 3 topics: AUO reportedly cooperating with Intel, Acer's chairman talking down memory, and whether the Mid-Autumn holiday will bring a reversal. AUO gapped sharply higher at the open; the speaker admits he already took profit, near 20%. But with estimated volume of 80-odd wan (ten thousand) lots and volume snowballing upward, he does not want to bet; he is willing to buy back on a pullback, even at a higher price, because AUO has big enough volume.
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2:05Innolux Takes the Baton and the Panel Supply Chain
AUO's volume is large enough that short-term price differences do not matter; Innolux has finished consolidating and cannot fall further, so it may be the next pick, and panel supply-chain names such as Wetek benefit at the same time; he also thinks AUO's optical communication cooperation with TSMC and Intel makes sense, and finally takes a jab at Acer's remarks.
▶ Watch from here3:45Acer's Remarks and the Mid-Autumn Reversal as a False Issue
He questions why only Acer is out shouting about a memory shortage while Wistron, Quanta and others with big orders say nothing; he also finds the talk of "opening up Chinese supply" contradictory, though he heard Acer did get some supply. Jensen Huang has also said before to expand capacity as much as possible and sell more, so memory should not be swayed by Acer's short-term talk; just watch the broad market. The Mid-Autumn reversal is a false issue: as long as the market's 5-day and 10-day lines remain in bullish alignment, keep exposure above 80% and exit only when they break; any holiday reversal talk is nonsense.
▶ Watch from here7:20AUO's Continuing Tailwinds and Innolux Certification Progress
The speaker believes AUO will cooperate with both TSMC and Intel, and both are very good; AUO is pushing optical communication, so related upstream and downstream supply-chain stocks are worth watching. There is no need to let go of what you hold easily, unless AUO leads a pullback; as long as AUO stays above its 5-day line, related stocks can be held. Innolux is rumored to pass FAU and TGV certification in Q4, which does not conflict with CCL; the speaker's AUO main order and add-on order together show a profit near 20%.
▶ Watch from here8:35Exposing the Calculation Behind Acer's Remarks
He thinks Acer has few AI orders, and AI PCs are not the focus now; ASUS holds a pile of AI server orders yet has not been heard speaking out. Acer's chairman has always liked to shout shortage; the historical pattern is that after getting his own supply he says memory should rise in price, making rivals pay more for supply, a pawnshop mentality. The speaker contrasts this with his own experience getting a high trade-in price on an old Apple device.
▶ Watch from here10:15Limit-Up Lesson and Defending Low-Priced Stocks
Moving to the limit-up segment: a low-priced stock can be locked limit-up with just 1000 wan (ten thousand), so locks with only a few thousand or a few hundred lots are not attractive; it needs at least 1 wan (ten thousand) lots to be worth watching. For a stock like Yuanjing, a tomb-raider pattern that suddenly pops one candle after long dormancy, you can defend only the first limit-up candle, or the average midpoint of 2 volume candles. 4956 retested its quarterly line, reclaimed it, and then surged; if Compeq (Huatong) also prints a long red candle, switch to defending the long red candle's low, which allows trailing profit-taking. Endo has over 2 wan (ten thousand) lots; if you chase in, the stop must be very tight, about 10%, to see if it can turn into 15%.
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14:20Panel ICs Strengthen and Defense for Hotung
Dianxu is an upstream IC designer; if it returns to around 65-70 it may be a buying chance, and defending about 65 is enough. Its strength suggests touch ICs, driver ICs and other panel-related groups may improve together, and the big stock Novatek is worth watching too. Hotung has a semiconductor chemicals theme; at this stage, defend the 5-day line at about 38.
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15:40TSMC Equipment Rally and Power, Packaging and Testing
For stocks with nice moving-average alignment, rising quarterly and monthly lines, increasing large holders and a TSMC semiconductor theme, if one pulls back after a breakout it is usually just a revenge-style push higher, and it is hard to beat. The speaker names semiconductor equipment stock Quanta Wafer (蔚華科), expects an equipment rally before TSMC's next important moment, and says to hold if you have it. Power themes such as Delta are also strong; packaging and testing stocks were hot last week, but today only Hua Dong is holding up the group, and memory-related packagers such as PTI can still be watched on pullbacks.
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17:35Bin Chuan Strengthens and the Connector Group
Bin Chuan's trapped-holder selling pressure has been mostly absorbed, and if it shakes through it could make new highs; UMC-group-related stocks such as Chipbond and UMC are strengthening. The connector group (Speed Tech, Cheng Uei-type names like Gigastorage's peers, BizLink, Hanlin and others) is a recently underestimated industry; high-speed transmission cables are important, and as long as the pattern is not broken they are worth watching, with BizLink's base also fairly low. Delta reclaimed its quarterly line; today the market was held up by heavyweights while the OTC index was weaker; next he discusses the risk after the probe-card craze fades.
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21:15Hanchi Risk and Crowding Out of 1,000-Dollar Stocks
He warns that the lottery craze for Hanchi (漢測) has faded, with only 150 lots traded today; if it first retests below 4000, it will affect high-priced probe-card stocks in the same group. Super-high-priced stocks will not collapse, but he does not recommend short-term holding, though long-term holding is fine. Today's market turnover was only over 8000 hundred million, not as heavy as last week; with limited funds, high-priced stocks cannot all rise together, and only MediaTek and Delta had volume today, as institutions prefer high-volume stocks. High-priced stocks lack retail volume, so they fall fast once someone stops playing; he therefore recommends buying when a trend is forming and going with it.
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24:40Market Exposure and the Mindset of Trading with the Trend
He stresses buying with the trend, not against it; after a big black candle or big limit-down in a high-priced stock it usually continues, so do not catch it, because few retail or large investors are willing to take it. Market volume of 8202 hundred million is a bit insufficient, but his exposure stays above 80% because his stocks are rotating and some stock still surges every day. The OTC index is consolidating in a box range, with 400 as the new defense point; if it breaks, exposure will drop fast. He hopes the market passes its prior high and keeps the optimistic momentum; thinking optimistically makes the daily commentary fun.
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28:15Warrant Ranking Segment and Warrant Targets
On why the new warrant ranking segment exists: people willing to spend big on warrants are bearing time-value decay, so they usually have conviction and a margin of profit. Today someone bet on Sino-American Silicon and Acer; betting on Chipbond makes sense (the UMC group is still rising), and betting on Delta already has profit margin; what interests the speaker most is that someone is betting at this level on Gold Circuit Electronics (2368), and the intent behind it is worth exploring.
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29:20Heavy Support at Gold Circuit Electronics: A Psychological Game
The level at which Gold Circuit Electronics is being bet on makes a stop easy to set, and a share price of about 1000 is not expensive. An earlier candle seemed to reclaim the quarterly line, then a heavy-volume selloff came, even retesting the range low, which is usually read as dead, with the wolf coming back; but after that happened two days ago, someone has heavily supported it these two days, it reclaimed the quarterly line, and it attracted many people to bet heavily on warrants; the trend has not weakened, which the speaker calls a psychological game.
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30:25Warrant Blocking Points and Issuer Logic
He explains the logic of warrant blocking points: warrants carry time value and buyers usually trade short term, so they bet at key turning points or places with very attractive technical patterns, and dump if it does not work. Zhusheng Technology (竹陞科技) was blocking a rebound pattern and may have blocked wrongly today and been dumped; MediaTek was blocked at a hook-up with a gap-up attack the next day through the prior high. The speaker thinks the position chosen for Gold Circuit Electronics is good; watching warrants every day means watching where people place bets at spots with something fishy going on.
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32:45Exit-on-Break Mindset and Cooling Stocks
Using a breakup analogy for pullbacks: once a stock turns back and breaks key moving averages such as the quarterly or monthly line, run faster and do not agonize like retail investors; this rally was pushed up by institutions, and they will leave if they do not window-dress, so do not agonize over fundamentals. The speaker mentions Wiwynn (6669) with over 2 months of profit of 50-odd %, an ideal selling point, and active ETFs have now begun trimming. Active ETFs added to Voltronic on both sides; he thinks cooling stocks can be bet on for 1-2 candles, with Voltronic defended near 2270; Kaori and AVC are also at key levels where the breakout is too high, and if they fail to break through they turn back; on failure the stop need not be held too long.
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40:20Investment Trust Rules and Views on the NT Dollar
He reveals an investment-trust internal rule: a trust cannot hold more than 20% of one stock, and Voltronic is already at 17.17%, with trusts having already bought earlier, so other institutions are unlikely to chase. Hence investment trusts have only two paths: hold up to break the high by the end of September and play a quarter-end rally, or else take profit, and not in just one day. The speaker stresses that retail investors need to understand such rules of the game and not listen to people saying "it's great, don't leave"; if it does not work, leave. He also mentions Quanta Wafer (蔚華科) comes out of its restricted period today and Kaori tomorrow. Today's view: the NT dollar is appreciating again and foreign investors are buying heavily; if the Japanese market opens well tomorrow, it may lift PCB and memory.
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43:10Warning of OTC Weakness at High Levels
The OTC index turned weak today and is again at the high end of its range; foreign investors bought hard last week, but today only cared about the main board and not the OTC market, so beware the risk of foreign investors not supporting the OTC market. The talk then turns to Mid-Autumn gift box chatter, with the speaker feeling he received too many egg yolk pastries and mentioning the jerky and pork floss gift boxes from a well-known Daya shop.
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