Steel prices take a breather, setting the stage for a stronger start!

The overall market trend remains bearish, but the short-term direction is not very clear. Some might say, since the overall trend is bearish, we should just continue to go short. The logic is sound, and it's definitely fine to go short in the short term. However, if going short in the long term, there are two scenarios to consider.

Most market reversals begin on a short-term basis.For instance, if the weekly chart is bearish, but if the market has already started to reverse on the hourly or even daily scale, the reversal of the weekly chart requires at least one week to confirm. By the time the weekly chart confirms the reversal, the market has moved significantly, potentially leading to substantial losses. This is akin to the saying, "The wind rises from the tiniest grass blade, and the wave is formed from the smallest ripples."

We remain bearish, with the market experiencing a short-term period of unclear direction and volatile movements.Our attitude may be better, able to remain unaffected by the ups and downs, as our analysis predicted, after a period of volatility, the market broke downward as desired, which is the outcome we wanted. However, the reality is that most people's attitude isn't that strong. A slight drop in the market brings immense joy, and a slight rebound leads to doubt about their decisions. Should they continue to hold on, might they face further losses? Should they leave and observe first? Or follow the market's trend to buy high and sell low, ultimately finding it difficult to achieve the desired results.

All market trends across all varieties are divided into three stages: rising, falling, and oscillating. The rising and falling stages are very clear, with a straightforward and crisp trend, making it comfortable to observe. It resembles the swift and decisive revenge of a martial artist in the江湖, where a rise is a proper rise and a fall is a convincing one. The most challenging stage is the oscillating phase. It appears to be on the rise, but after a few jumps, the price plummets again. When it seems to be heading downward, the decline is minimal before the trend reverses upwards. This kind of market trend is quite frustrating.

In a volatile market, it's essentially a trendless fluctuation, where variables are extremely high. It could soar due to a piece of news, or it might be brought down due to continued downward pressure on funds. If using a 55/45 split between bulls and bears as the boundary for strength, the bearish trend currently only accounts for 60%, slightly favored. At this time, there's no need to gamble just because you want to trade or purchase goods. By the way, if it all works out, it's a win-win situation; but if not, you not only face financial losses but also a significant blow to your mindset. Of course, if you opt for a clean-out trial and error, even in不利 circumstances, it won't do you much harm—this is an exception.

At this stage, the better strategy on the market is to be on the sidelines, patiently waiting for the market to clearly define its direction: whether it will continue to decline, choose to break upwards and move into a range, or remain in a range. Only once the direction is clear should action be taken. As for our现货 comrades, the strategy is quite straightforward: for those with essential business needs, simply purchase and sell goods in accordance with the rhythm.If our business is already slow, the difficulty in shipping is significant, and with high inventory levels, there's no need to chase after a possible rebound at this stage. We're not gambling on market trends; we're making highly certain investments. In uncertain times, a cautious wait-and-see approach is the better strategy.