Chapter 18 - Expert: 80% of Institutions Believe the Market Has Bottomed Out
Fang Hong didn't even have to think twice. The moment he saw the title of the post, he knew it had to be the work of Cao Chenghui. To achieve tenfold returns in just one month, one would need to generate more than 10% profit every trading day. Sustaining such an impressive rate of return was nearly impossible for an average trader.
Currently, in the entire A-shares market, there was only one person capable of such an extraordinary feat.
This post had gained significant traction and continued to rise in popularity. It had already amassed over a thousand comments, and judging by its momentum, it was on track to becoming a viral sensation.
Intrigued, Fang Hong clicked on the post and skimmed through the content. He only focused on the author.
"Cao Chenghui always times his posts for maximum impact, posting after the market closes so there's no immediate scrutiny. Not a bad strategy." Fang Hong analyzed as he browsed through the post.
It didn't take long to finish reading. In fact, there wasn't much content—just a few paragraphs. The timestamp revealed that the post had been created eight days ago.
Though Cao Chenghui had been a stock trader for over ten years, he was still just an old retail investor. However, he had enough awareness to manipulate market perception.
Interestingly, he never replied to comments. Fang Hong immediately understood why—Cao Chenghui was deliberately maintaining an air of mystery, pretending to be a short-term trading expert.
His strategy was simple:
Every day after market close, he would post an update on his Tianya Forum account, making it seem like he had accurately predicted the day's movements.
Casual investors and uninformed traders would then mistakenly believe he had real expertise.
However, this approach was risky.
Fang Hong's trading strategy was based on intra-day ultra-short-term trading, where he bought and sold stocks daily.
Meanwhile, Cao Chenghui was revealing his positions only after the market closed, exposing himself to potential manipulation the next trading day.
Recognizing this weakness, Fang Hong decided he would counter Cao Chenghui's influence in a subtle yet effective manner.
---
The Olympic Frenzy & Market Movements
In the past few days, the most talked-about event was undoubtedly the Olympic Games. It was a grand spectacle that captivated the entire nation, dominating news headlines and social discussions.
However, Fang Hong paid little attention to the festivities, remaining laser-focused on trading.
On Monday, August 11, the A-shares market kicked off the first trading day of the week.
As the market opened, the stock Lianhua Hexian, which Fang Hong had acquired last Friday, opened flat but began to soar almost immediately.
"Sell!"
As soon as the stock surged close to 4%, Fang Hong executed his trade, exiting his position.
Beside him, Cao Chenghui swiftly followed suit, cashing out as well.
Immediately after, Fang Hong turned his attention to a new target—Changjiang Investment (Shanghai Stock Exchange, Stock Code: 600119). The stock had opened flat that morning but soon plunged by 4.27%.
Without hesitation, Fang Hong made his move, going all-in at the dip, purchasing at an average price of 4.93 yuan. Within one minute, he had completed a 1.45 million yuan transaction, collecting panic-sold shares from weak investors.
Cao Chenghui also jumped in, though his average entry price was slightly higher, at 4.95 yuan. Since the stock was already rebounding by the time he bought in, his cost was marginally higher than Fang Hong's.
By 11:00 AM, Changjiang Investment hit the daily limit.
"That was an easy win! I just made a clean 15% profit on this single trade!" Cao Chenghui exclaimed in excitement. His combined gains from Lianhua Hexian and Changjiang Investment pushed his total floating profit to over 20% for the day.
Meanwhile, Fang Hong's account balance swelled to 450,000 yuan, boasting a cumulative return of +565.49%—more than fivefold growth.
Cao Chenghui's account balance also surged close to 250,000 yuan. If he hadn't withdrawn money secretly without telling his wife, his capital would have been almost on par with Fang Hong's.
Trading alongside Fang Hong made A-shares feel like an ATM machine—a place to effortlessly print money every day. It was even faster than robbing a bank, or so it seemed.
But in reality, the broader stock market was in turmoil.
The previous Friday, August 8, the Shanghai Composite Index had plunged by 4.47%.
And today, the decline was even steeper.
By the end of trading, the Shanghai Composite Index had plummeted -5.21%, closing at 2,470.07 points.
This drop broke the previous low of 2,566.52 points recorded on July 3.
It also breached the psychologically significant 2,500-point level, marking a new low since the 6,124-point market peak.
After market close, multiple financial institutions released market analysis reports.
At the same time, financial experts on business news channels unanimously stated:
"80% of institutional investors believe that the market has bottomed out."
---
Tuesday, August 12 - The Unexpected Dip
The following morning, Tuesday, August 12, the market opened, and Changjiang Investment saw an unexpected sharp decline of -7.94%.
Cao Chenghui was caught off guard.
"What the hell? Why is it opening so low?" he muttered, feeling uneasy. In the days of following Fang Hong, he had never encountered such a drastic gap-down opening. Nearly all of yesterday's profits were wiped out in an instant.
Fang Hong, however, remained calm.
"Something is off..." he murmured, staring at the price movements.
Cao Chenghui turned to him. "What's wrong? Is there a problem?"
Fang Hong didn't shift his gaze. "It feels like someone is deliberately suppressing the stock price to force us to sell at a loss."
"That's not possible, is it?" Cao Chenghui asked skeptically.
Fang Hong remained pensive. "In theory, it shouldn't happen. After all, while you and I are trading with substantial funds, our entry was discrete, without causing major market ripples. Under normal circumstances, we shouldn't be targeted—unless someone deliberately disclosed our positions."
At that moment, Cao Chenghui's face paled.
His mind raced: "Could it be... my posts on Tianya Forum? Damn, it must be that!"
He stole a nervous glance at Fang Hong, trying to gauge his reaction. However, Fang Hong's face remained unreadable, locked in deep thought.
Just as Cao Chenghui was drowning in guilt, Fang Hong suddenly turned and smiled.
"It's not a big issue. Just hold steady—there should be a rebound in the afternoon. There's a high probability the stock will surge again, and we'll make money then."
Cao Chenghui forced a smile and nodded, hoping Fang Hong hadn't figured out his blunder.
But unbeknownst to him, Fang Hong had already seen through everything—Cao Chenghui had walked straight into his trap.
"He has no idea he's already under my control," Fang Hong smirked inwardly.
---
End of Chapter 18