Hu Liyang's three-day theory: 2022 U.S. stock market opening notes

Mon 3/1/2022 4:25PM ET

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The first day of the market in 2022 turned out to be a good start for the US stock market, especially $Tesla (TSLA.US)$ presenting the sales data report for the fourth quarter before the opening, giving investors a New Year's gift, with stock prices soaring to USD 1200 at one point, confirming that even elephants can dance.

Another good news is $Apple (AAPL.US)$ making history by becoming the first company in the US with a market cap of $3 trillion, especially as funds have clearly flowed into large-cap stocks over the past few months.

Semiconductors, finance, tourism, and energy sectors all had a good performance on the first day of 2022. However, post-pandemic stocks and technology software companies, especially those related to network security, experienced significant pullbacks. As I mentioned before, although the global confirmed cases have repeatedly hit new highs, data from many countries indicate that the new variant virus is not as lethal as when it first emerged. Both the mortality rate and hospitalization rate are lower compared to the outbreak last year. The Pasteur Institute estimates that severe cases caused by Omicron can be reduced by 50% to 80% compared to Delta; the UK Health Security Agency also stated that the risk of entering intensive care with an Omicron infection is reduced by 31% to 45% compared to infecting Delta cases. I believe this will be a turning point in the pandemic. A tourism recovery is highly likely, and global consumption will shift from commodities to a focus on service experiences.

Over the past two years, most investors have focused on the semiconductor sector but overlooked a very important theme for the future, which is the increasingly frequent adverse climate events in recent years. This will lead to a more urgent development of green energy. I think investors can spend some time researching companies related to this theme.

Known as the "Father of the Stock Market" by the media, Hu Liyang once proposed the "3-day theory", which analyzes the stock market trend in the first 3 days of the year to predict the potential plight of the stock market for the whole year. According to his statement, the accuracy of this theory is as high as 70%. Currently, the performance on the first day is noteworthy, and we will continue to track the next two days.