The recent surge in market momentum has reignited discussions about whether a new bull cycle is truly underway. With traditional financial players like Chinese brokers entering the digital asset space, investor sentiment is heating up. On June 25, Guotai Junan International officially received approval to conduct cryptocurrency and virtual asset trading—a move that sent shockwaves across capital markets. The news triggered a 198.39% spike in its stock price, closing at HK$3.70 per share, demonstrating strong market confidence in this strategic shift.
This development didn't just lift one stock—it energized the entire sector. Hong Kong-listed Chinese brokerage firms rallied sharply, with Hongye Futures surging over 30%, while China Merchants Securities and Guolian Minsheng climbing more than 10%. The broader market followed suit: the Shanghai Composite Index rose 1.04%, hitting a year-to-date high, with nearly 4,000 stocks ending in positive territory.
Amid back-to-back days of strong volume-driven gains, many investors are asking: Is this the start of the main bull phase? Should I go all-in now?
My answer remains consistent: pause and reflect before acting.
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Why Rushing Into the Market Is a Mistake
A true bull market isn’t built in two days. Even if we are entering a sustained upward trend, history shows that markets rarely move in a straight line. There will be pullbacks, corrections, and opportunities to enter at better valuations.
Reacting emotionally to short-term price moves—especially by chasing momentum—often leads to poor outcomes. Missing a rally means you didn’t profit; making a wrong bet can mean significant losses. That distinction is critical.
The most dangerous time in investing is when everyone feels safe. When optimism becomes widespread, risk accumulates quietly beneath the surface. As prices rise faster and higher, so does the potential for a reversal. And in financial markets, it only takes one major misstep to erase years of gains.
Build a Resilient Investment Framework
Successful investors don’t rely on luck—they operate within a disciplined system. Regardless of market conditions, having clear principles helps you stay grounded during both euphoria and fear.
Here are three core tenets I’ve followed through multiple market cycles:
1. Avoid Speculative Bubbles at All Costs
I never participate in assets driven purely by hype or speculation. Instead, I focus on investment value and risk-reward balance. This means buying quality assets when they’re undervalued—not because they’re trending, but because their fundamentals justify ownership.
When FOMO (fear of missing out) spreads, remember: the goal isn’t to catch every wave—it’s to survive long enough to profit from the ones you understand.
2. Prioritize Risk Management Over Return Chasing
Markets reward patience, not impulsivity. The higher an index climbs—like the current approach toward 3,500 on the Shanghai Composite—the greater the effort required to sustain gains. Each incremental advance consumes more bullish energy, increasing vulnerability to setbacks.
Moreover, prolonged periods at elevated levels erode buying power and sentiment over time. Without strong fundamental support—such as corporate earnings growth or monetary easing—rallies become increasingly fragile.
3. Stick to Contrarian Principles
One of the most effective strategies in volatile markets is contrarian investing: buying when others are fearful and selling when greed takes over.
- Buy low, sell high isn't just a cliché—it's a discipline.
- When markets crash, that’s often the best time to accumulate.
- When headlines scream “bull market confirmed,” it may be time to take profits.
This approach—buying dips, selling rallies—may not feel exciting in the moment, but it builds long-term wealth with lower risk.
Macro Realities Can’t Be Ignored
Despite the current enthusiasm, key macroeconomic factors remain unresolved. The U.S. Federal Reserve has shown no urgency to cut interest rates, with any meaningful policy shift unlikely before September at the earliest.
Higher-for-longer rates continue to weigh on global liquidity—especially for risk assets like equities and cryptocurrencies. Without clear monetary easing signals, rapid price increases in equities raise sustainability concerns.
In such an environment, short-term rallies can quickly reverse without solid underpinnings. That’s why speculative surges should be met with caution, not celebration.
Navigating 2025’s Complex Market Landscape
As we transition from the first half to the second half of 2025, one thing is clear: this year will test investor discipline like few others.
Yes, markets appear lively. But beneath the surface, volatility is rising, correlations are shifting, and the margin for error is shrinking. Going all-in based on two strong days of performance is not strategy—it’s gambling.
True investing success comes from waiting for high-conviction opportunities, then acting decisively when odds are overwhelmingly in your favor.
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FAQs: Addressing Common Investor Concerns
Q: How do I know if this is a real bull market?
A: Look beyond price action. Real bull markets are supported by improving fundamentals—earnings growth, economic data, policy support, and broad participation across sectors. If only a few stocks or themes are driving gains, it may be a speculative rally rather than a sustainable trend.
Q: Should I sell everything if I think the market is too high?
A: Not necessarily. Instead of going fully defensive, consider rebalancing—taking partial profits from overvalued positions and reallocating to more attractively priced assets. Discipline beats timing.
Q: What assets perform best early in a bull cycle?
A: Historically, financials, technology, and cyclicals tend to lead early phases due to improved liquidity and investor sentiment. However, always assess valuation—past performance doesn’t guarantee future returns.
Q: Is now a good time to invest in crypto-related financial stocks?
A: It depends on your risk tolerance and research depth. Brokers entering crypto signal growing institutional adoption—a positive long-term trend. But short-term stock movements can be exaggerated by sentiment. Focus on companies with clear business models and regulatory compliance.
Q: How can I avoid emotional trading?
A: Create a written investment plan outlining entry/exit rules, position sizing, and risk limits. Review it regularly—not during market swings. Automation (like limit orders) also reduces emotional interference.
Q: What’s more important—timing the market or time in the market?
A: For most investors, time in the market wins over perfect timing. But that doesn’t mean buying blindly at peaks. Strategic entry points matter. Combining long-term perspective with tactical discipline offers the best balance.
Final Thoughts: Wait for Your Pitch
Investing isn’t about feeling entertained or chasing adrenaline rushes. It’s about generating consistent, risk-adjusted returns over time.
Opportunities will always exist—markets never stop moving. The key is waiting for the right moment: when risk is low, reward potential is high, and your analysis gives you conviction.
Don’t force trades out of fear or greed.
Stay patient. Stay principled.
And when your moment comes—strike with confidence.
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