How to Screen and Participate in Limit-Up Stocks Driven by Positive Catalysts

When trading stocks, we often encounter news about corporate events—both positive and negative. Stock prices frequently rise on positive news, and major market-recognized catalysts can even trigger limit-up moves (a 10% daily gain) or consecutive limit-ups. Many stocks' first limit-up is driven by positive news, making such "first limit-ups" the most common. Especially in bear markets, where high-flying stocks are scarce, many funds focus on low-position first limit-ups driven by news.

1. Finding Positive/Negative News

How do we find such news? Focus on the "Big Three" financial newspapers:

• China Securities Journal

• Shanghai Securities News

• Securities Times
  These are the most authoritative platforms in the financial circle, widely followed by hot money and institutional investors. Alternatively, follow WeChat public accounts that summarize key news to save time.

2. Screening Useful News

① Focus on emerging tech and breakthrough themes

• Examples: New tech products or major technological breakthroughs.

• Stocks trade on future expectations. Emerging tech, having no prior炒作 (speculative precedent), offers vast room for speculation if market sentiment aligns. If a theme is already hot and new tech catalysts emerge, pay extra attention.

② Policy benefits in niche sectors

• Especially if aligned with a current policy hotspot (e.g., infrastructure).

• If the news relates to an un炒作 (unexploited) niche, target the involved stocks.

③ Stock-specific catalysts

• Includes operational investments, private placements, M&A, contract wins, high送转 (bonus shares), earnings disclosures, and shareholding changes.

• These usually lack sector-wide impact.

  • Minor catalysts: Weak follow-through, often gap up then trap buyers.

  • Major catalysts: High expectations, typically lead to一字板 (one-word limit-up), leaving no entry.

• Generally avoid due to high participation difficulty.

3. How to Participate in First Limit-Ups Driven by Catalysts

For first limit-ups driven by news:

1. Pre-market screening: Shortlist candidates and verify market reaction the next day.

2. First limit-up logic: Since the theme is fresh, the market hasn’t gauged its strength. Most traders react after the limit-up. Thus, the earliest to limit up, with the strongest intraday charts and clearest edge, becomes the leader.

3. Follow-up actions:

   • If the theme persists and triggers a limit-up wave, dig for the purest leader.

   • If the sector leader locks in a一字板, target low-cap quality stocks that reopen and re-seal (T-shaped limit-ups).