Hexun Investment Advisor Hu Yunlong: The Reason for the Adjustment Has Finally Been Found

The reason for the market correction has finally been identified.

Hu Yunlong from Hexun Investment Consulting analyzed that after summarizing the opinions of several market participants, influenced by yesterday’s sentiment, everyone was generally optimistic today. Yet, the market closed with a small decline. Is the market wrong? Clearly, things are not that simple. I believe the market has quietly experienced a new change driven by a certain annual report, which many may not believe. As quarterly reports continue to be released, a prominent annual report from Han Wang has emerged. Looking at the report itself, such a significant positive announcement should have triggered a strong reaction, but the reality was quite the opposite. There was no rise in stock price; instead, it closed with a small downward candle. Is it because the performance growth isn’t enough? Or because the dividend plan isn’t good enough? I think neither. The market has already digested the positive news. Let’s continue to observe its trend—you’ll find that since July or August last year, it had already experienced a substantial increase and was oscillating at high levels for four months. As for the current positive news, it is mostly within institutional forecasts. We can only say that the market has already reflected this trend. If it doesn’t rise now, what does that mean? It means retail investors are being pre-judged by institutions again.

In the past two days, many tech stocks have also shown adjustments, not because their performance growth isn’t strong enough, but because they were preemptively driven up before the Spring Festival. This pattern is very similar to Han Wang’s current trend. As for those waiting for the impact of quarterly reports in March or April, and hoping for positive news to materialize, we need to consider an important question now.

Is Han Wang an isolated case or a common phenomenon? Based on the market’s conclusion, it seems that such positive news being realized often turns into short-term negative expectations, and this trend is already fermenting in the market. So why have I been warning everyone to pay attention to the risks of high-priced stocks in March and April, and to control positions? It’s not because opportunities are absent, but because stocks like Han Wang will continue to appear with similar patterns. Especially before positive news is announced, if the stock doesn’t decline in advance, it will be very difficult to find a better entry point. Don’t forget, there are many stocks like this, and with more than a month until the end of April, we’ve only seen some stocks with positive news perform well—others simply remain stagnant or even adjust. Have you ever thought that there are many more stocks with negative news that haven’t been announced yet? Preparing in advance is, I believe, the key.

(Edited by: Shao Xiaohui)

【Disclaimer】This article only reflects the author’s personal views and has nothing to do with Hexun. Hexun’s website remains neutral regarding the statements and opinions expressed in this article and does not provide any explicit or implicit guarantees regarding the accuracy, reliability, or completeness of the content. Readers are advised to use it as a reference and bear all responsibilities themselves. Email: news_center@staff.hexun.com