AUO Chase Discipline: Buying Near the Quarterly Line, Stop-Losses and Trading in Low-Volume Markets
TL;DR: Don't chase highs until the broader market breaks higher on volume; pick only stocks within 10% of the quarterly moving average that have formed a base, and set stops at the 5-day line or the low of the red candle, because chasing now means an overextended deviation, so wait for a high-volume breakout.
Key ideas
- Judge a private placement by long-term orders, not next-day price moves: Amazon's private placement in Gold Circuit Electronics makes it a long-term anchor shareholder, and what matters is that orders are secure for the next 2 years; Nanya Technology also fell to 200 after its placement and later rose to over 500, so one day's move is just market sentiment.
- Buying near the quarterly line has clear conditions: within 10% of the quarterly line with a higher-low base; skip stocks that have broken below the July low or keep falling with the quarterly line still far away; after entry, use the double support of the 5-day and 10-day lines for the stop, or the low of that day's red candle.
- Discipline when chasing highs: AUO is overextended, so chasers can only defend candle by candle and should sell half once the 5-day line breaks; for ASE he would rather sell too early than take the risk, and for King Yuan Electronics he waits for a pullback to the 10-day line and for foreign selling pressure to subside.
- Volume reveals who is buying: Wafer Works' volume spike of about 15 wan lots is not retail but big players entering; WIN Semiconductors has bullish moving-average alignment but resistance between 550 and 600, so run at the first black candle with an upper shadow.
- The overall cash-level strategy is to buy only in bullish alignment and not bet in bearish alignment: keep the cash level at 80% or more without cutting recklessly, adjust once the OTC index breaks the 10-day line at about 408, and don't be tricked in by day traders during low volume; chase only on a high-volume breakout.
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Section summaries
1:25Analysis of the Gold Circuit Private Placement Boost
Amazon is taking a private placement in Gold Circuit Electronics at 1070. The speaker sees it as a long-term anchor shareholder move, where the point is that orders are secure for the next 2 years, not the next day's price move. He cites Nanya Technology, which fell back to 200 after its private placement and later rose to over 500, to show that one day's move is only market sentiment. Gold Circuit's P/E of about 12 is cheap enough, margin buying keeps coming, and big-player holdings are still rising, so the direction is right.
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7:35AUO Limit-Up and Conditions for Buying Near the Bottom
Just treat Amazon's private placement as a long-term shareholder locking in Gold Circuit. AUO hit limit-up again intraday, but the speaker had earlier set a safe entry point, buying only on a return to the consolidation area (near a certain candle or the 10-day line). That didn't come, and with the broader market not yet breaking higher on volume, he doesn't want to chase the top. Stocks like Innolux that touch the quarterly line can be waited on, provided they are within 10% of the quarterly line and have formed a base; if they have already broken below the July low, or keep falling with the quarterly line still far away, he won't touch them.
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9:45Chase Defense and the Yageo Opportunity
Chasing AUO means an overextended deviation, so you must defend candle by candle, and you can sell half as soon as the 5-day line breaks; the show's stance is conservative. He also names passive components as promising, using Yageo as the example: its chart will sooner or later break through the quarterly line, so it is an opportunity worth being patient for.
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10:50The Three Big Packaging and Testing Names and the King Yuan Entry Point
He introduces the three big packaging and testing names for 2027: ASE Holdings does advanced packaging, Powertech does memory packaging, and King Yuan Electronics does testing with expanding capacity, all benefiting from TSMC and the AI rally. King Yuan has surged in the short term and can be bought on a pullback to the 10-day line, but when foreign investors keep net selling, wait for the selling pressure to subside before entering.
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12:15ASE Trading and Valuation
With ASE he would rather sell too early than take a risk: hold while the 5-day line is intact, and exit once it breaks. Looking back at 600, he backed ASE as still among the high-flying stocks, estimating that 2027 EPS of up to 30 at a 20x P/E makes 600 a safe price.
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14:35GlobalWafers Scenario and the Limit-Up Radar
After GlobalWafers crossed above the quarterly line, a direct V-shaped reversal is unlikely, since trapped holders' costs near the quarterly line are spread across 650 to 1125, so selling pressure is not light. If a black candle with an upper shadow appears with the price falling, be careful; if it comes with the price rising, watch one more day. He then quickly scans the limit-up radar; he is unfamiliar with Jia Da and Unimicron and doesn't want to touch too many.
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16:00Hoyi Chart Pattern and the Polite Stop-Loss
The speaker calls Hoyi very lively, with a chart similar to AUO's back then: it pulled back after going higher, though this time the pullback is smaller. Today's red-candle bottom and the 10-day line form a pivot-point support that must not break, and with volume rising versus yesterday, stacking volume on volume attracts players. Asia Electronics rebounded after returning to the quarterly line; its stop is the double support of the 5-day and 10-day lines, and if it isn't pushed to the extreme, today's red candle serves as the defensive low. For Innolux, too, he defends at today's red-candle low, because this red candle held the quarterly line and other moving averages.
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18:55New Pick Near the Line and WIN Semiconductors Resistance
One stock touching the line from below locked limit-up on only 4000-plus lots. If it locks limit-up for two days without volume, it needs a volume shakeout so that next-day traders take over, and if it is pushed down intraday and finds support, you can enter. WIN Semiconductors hit limit-up with bullish moving-average alignment; watch resistance at 550 to 600, since further gains enter the trapped-seller zone, and run on a black candle with an upper shadow.
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21:55Wafer Works Volume Spike and Big Players Entering
Wafer Works started rising today; for taking profit, defend the red-candle low or the 10-day line near 115, and a further break would mean consolidating for another 1–2 weeks or more. Today's volume was higher than in the previous days and it only held near 12 o'clock, so volume stacking on volume is possible. A volume spike of about 15 wan lots is not retail but big players entering; the big rally on August 17 did not produce such volume, and this time it did, so it may be real. Wafer Works had lagged Taiwan Sumco and UMC, but late always arrives eventually. He also mentions IP-related stocks such as Sigurd and Yongzhi Technology; Yongzhi had a polite rebound back at the monthly line, so the stop is easy to set.
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24:55Solid Candle Breakouts and Facility Equipment Stocks
Juhong is too far from the quarterly line, so he doesn't recommend buying near the line; once it breaks after you touch it, you should leave. Another stock can be played, but you must tolerate intraday swings and run at any time when trading short term; Zusheng Technology is under disposition and the speaker actually dares to trade it. Facility, semiconductor equipment and testing stocks are starting to move. HannStar's solid candle breaking higher looks beautiful; if you missed the first candle, you can take a chance to enter on its pullback. New faces like United Renewable Energy whose volume is starting to run ahead are also worth noting.
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29:00Review of ABF Group and Memory Stocks
BizLink-KY closed with an upper shadow; if it breaks the bottom the speaker will definitely leave, holding through counts as passing the test, and he dares to buy when it comes back to test once more. Zhen Ding Tech has touched the line from below, so play it now because the 5-day line is coming up; Nan Ya PCB is about to pass its 10-day high. ABF fell and then rose, and once it climbs near the level where he originally sold, he will definitely buy on a pullback; with PCB sector holdings there is no need to be too nervous. For another memory-related stock, the speaker says memory depends on Korea, the chart looks nice and can be waited on, and this time he was shaken out but did fine after switching stocks.
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31:20Active ETF Moves and Accton Watch
The active ETF daily report shows one fund adding Delta Electronics; the speaker says Delta below 1300 is truly cheap, and equipment stocks like Foxsemicon are cheap too, while Wiwynn and ASE are being trimmed, with ASE still being trimmed continuously. Another fund added Kaori and trimmed Global Unichip and Accton; the speaker thinks that after such a large stock has gone higher for a while, he himself would also get nervous. Accton's third-quarter figures may be a bit weaker, so he suggests waiting for it to stop falling and rebound before looking, not rushing to bottom-fish.
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32:30Trading Strategy and Trimming Discipline
Accton is currently in bearish alignment, so the speaker doesn't bet on it; his strategy is to buy stocks betting on bullish alignment, not to buy during bearish alignment and not to short during bullish alignment. He has not been chasing stocks much lately, because the Taiwan dollar has not appreciated and the OTC market has not filled in with nice volume. However, the Japanese and Korean currencies are still appreciating and oil prices are falling, so he keeps the cash level at 80% or more and doesn't cut recklessly. Adjust the cash level once the OTC index breaks the 10-day line at about 408; either trimming evenly or trimming a single stock is fine.
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34:35Disposition Stocks to Watch
7792, which does power engineering related to TSMC, went into disposition; if it pulls back below 400 he would be interested, but volume is thin so he doesn't say much. He also mentions disposition stocks such as Four Seasons and Lianying Optoelectronics; if they don't go up after leaving disposition, consider selling half first.
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