A shares were a bit confusing today, and they were still in the red market in the morning. As a result, at 13:08 pm, a strong selling suddenly appeared, triggering a dive in the entire market. Although the downward range was not large, from the Shanghai Composite Index level, the dive fell by 1% at most, which was around 33 o'clock. The downward force of the ChiNext Index was relatively large, reaching 1.83% at most. What is worse is that the negative line of the ChiNext Index today actually swallowed up the rise of the past two days.
So, what is the reason for diving today?
I read some public opinion, and most of them said that the talk seemed to be bad, which caused the market to worry and caused the index to plunge.
To be honest, I think this understanding is wrong, because there is no news from any formal channels so far, so it is almost nonsense to think that this reason has caused the index to plummet. Of course, in addition to this factor, there is a high probability that there may be negative effects that we do not know. At least this matter cannot be avoided.
So what exactly is it? From my own understanding, the market plunge today is the result of a chain reaction. In the morning, the Shanghai Composite Index was in a red market, but the number of stocks rising in the two markets was more than 1,000, and the number of stocks falling reached 3,700, which shows that today is mainly the rise of bank stocks, while most individual stocks are in a state of adjustment. The reason why individual stocks are adjusted is because the market's understanding has deviated, because today is above 3,400 points. At this time, pulling banks means that the market is easier to break through. However, investors don't think so. At this time, you pulling large banks above 3,400 points is enough to show that the desire to cash out funds is relatively strong. In layman's terms, it is to pull banks to cover other themes for shipments.
So it is formed that when banks do not rise or rise weakly, the market's concerns are even more obvious. The selling at this time should be more obvious than when banks pull up. From the time-sharing chart, it should be seen that at 13:08 when the index plunged, bank stocks actually followed the plunge. This means that the diving of individual stocks also triggered the diving of banks, and the market downward formed a strong synergy effect, which eventually led to the sudden diving today. After all, both the defensive sector and the growth sector almost all showed strong selling at the same time, which is the fundamental problem.
How to move the market next?
From the K-line pattern of the Shanghai Composite Index, the strength of the negative line today is still somewhat beyond expectations. If we look at the lowest point in the trading session, it can be said that a negative line today swallowed the positive line of the past 4 days and rose. This gives people a little bit of a bull market, which is still too weak, and the bears suddenly dominate. This can be understood, but the fact is not the case.
In the analysis in the past two days, I mentioned that above 3400 points will not be smooth sailing, and oscillations are inevitable. However, today's decline is also a kind of oscillation, but in terms of time and amplitude, it is somewhat unexpected, but from the understanding level, I tend to adjust positively. What does it mean?
That is to say, you see that the negative line today is very strong, but in fact, the greater the amplitude here, the more you often show signs of washing the market. After all, after 3400 points, it has not been able to break through several times, and the market has already had a serious psychological shadow. At this time, just imagine that after today's decline, I estimate that the original bulls had the probability of turning into shorts before, and it is not even ruled out that someone had reduced their positions during today's decline.
These behaviors are normal, but it depends on when. The position of 3400 points is not high for A-shares. At present, both the weekly and the daily level have a good breakthrough. Before the real breakthrough comes, there was a sudden dive. I think this is obviously a shock-stopping behavior. I still have a positive attitude towards this and see if there will be a positive trend tomorrow.
Disclaimer: The content in the article is for reference only and does not constitute any operational suggestions or prompts. Please be cautious when there are risks in the stock market and investment!
