1. Conclusion
First of all, I came to the conclusion that the fundamental contradictions of PTA are not outstanding, which means that the fundamentals have not changed much; secondly, the bulls and the shorts are frightened by this wave of market conditions, and the decline in positions is not caused by funds. This scapegoat “funds” “Can’t afford it. Therefore, I believe that this wave of PTA’s market is mainly driven by macroeconomics, supplemented by industrial drivers, and led by the cost of crude oil. On the occasion of a collective correction in bulk, coupled with the sharp decline in crude oil and the lack of outstanding fundamental contradictions, PTA has made in-depth adjustments.
2. Analysis Framework
1. Fundamental analysis
A. Macroscopic analysis
Government work report targets lower than expected
Whether key indicators such as GDP, M2, social finance, and deficit ratio are lower than expected, the stock market is sluggish, and large stocks have started a collective correction.
China’s inflation trade ebbs
Marked by China’s announcement of new loans in February, social financing lower than expected, and CPI falling below expectations, especially securities firms’ funds have begun to ebb, and commodities have taken off their financial attributes, leaving only the capital persistence of commodity attributes. . Fundamentals determine the direction of the price, and financial attributes determine the height the price reaches. The recent price is just a correction, not a reversal, and the trading height needs to be re-evaluated.
U.S. interest rate hike reaffirms economic recovery
The probability of the Federal Reserve raising interest rates in March has reached 100%. All Federal Reserve officials, no matter they are dovish or hawkish, are also venturing to raise interest rates. This is a reaffirmation of the economic recovery, which is beyond everyone’s expectations a year ago. This is also an indication of the upward momentum of the economy. confirmed, the long-term configuration idea remains unchanged.
Trump deal ebbs
The Trump trading craze has subsided, and the future is worth looking forward to. However, there is currently a lack of continued themes. It is no longer the main focus of current trading, but it is always a hidden positive energy.
B. Industry analysis
To put it simply, from the perspective of supply and demand, PTA supply remains loose, polyester factory inventory has accumulated, downstream demand may be dragged down, and the fundamentals are weak.
Let’s talk about crude oil again. Crude oil is the upstream of PTA, and it is also the cost side, even though the transmission chain is relatively long. The weak fundamentals lost support under the plunge of crude oil. By the way, the effect of crude oil on PTA is asymmetric, which means that when crude oil rises, PTA is less affected; when crude oil falls, especially when it falls sharply, the impact on PTA is amplified by the contagion of emotions. Many times. Regarding this, we can verify this from the price elasticity of PTA to crude oil. Once we understand this, it is clear that PTA has plummeted.
2. Market psychological analysis
After examining the macro and fundamental factors, if we do not conduct reverse reasoning on both the long and short sides in the market, then our conclusions based on the macro and fundamentals can only be shelved and cannot be safely implemented. Let’s take a look at the long and short trading paths of the top 20 seats. First, let’s take a perceptual look at the changes in the path of long and short positions: both long and short positions have been reduced to varying degrees, with long positions being reduced more than short positions, and short positions being larger than long positions. Secondly, let’s look at it from a relative perspective. The long-short position ratio deviated from the PTA price indicator in 2013 after the bulls lost their counterattack momentum during the two consecutive years of bear market. The rebound in 2016 restored the confidence of the bulls. The long-short position ratio 2017 begins with price synchronization. The recent long-short position ratio has fallen following the plummeting price, which is a sign of fear from both longs and shorts, and the bulls are obviously at a disadvantage. The third picture examines the historical relative position of the long-short position ratio. The green horizontal line indicates the quantile position of the long-short position ratio. It is now between the lower quartile and the minimum value. The power of the bulls is still relatively declining. Do More caution is needed, waiting is the better strategy at the moment.
3. Financial analysis
It can be seen from Figures 4 and 5 that funds have flowed out significantly recently. While it is still at a relatively high level in history, speculation has dropped to the bottom, indicating that the market decline has squeezed out a lot of speculative power. While the market is far from over, now is a good time. the incubation period.
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