Hexun Investment Advisor Tian Miaoxin: The Core Logic Behind Volume Contraction and Recovery

Today, the market is showing a contraction and recovery trend. After opening lower, it rose in line with our strategic expectations, ultimately leading to a broad increase. However, the trading volume has shrunk by over 90 billion compared to yesterday, which is a key signal.

Many people are puzzled as to why recovery can still occur with reduced volume. According to Tian Miaoxin from Hexun Investment Consulting, the core reason is quite simple: the current index has not yet reached the important resistance zone above, leading to reduced selling pressure. It only takes a small amount of force to maintain market stability, rather than a true offensive posture. Additionally, today’s market sectors exhibit a clear rotation characteristic, with technology and pharmaceuticals performing prominently, and the battery sector also showing some periodic fluctuations, though the sustainability of this remains to be observed.

It is worth noting that the overall recovery strength of the two heavyweight sectors, brokerage firms and liquor, is relatively weak. Today, they haven’t even filled the earlier gap, which also limits the overall strength of the market rebound. Many people easily fall into a misconception: they get excited when they see broad increases and start to panic when they see declines. In fact, the current market is still characterized by a range-bound oscillation. In the short term, there is no obvious risk of a crash, but there is also not enough volume to support a strong rebound. The rise and fall are more about the rotation and game of funds.

Now, let me share some practical advice. In daily trading, don’t be misled by superficial rises and falls or so-called net inflow and outflow data. Major funds often hide their true intentions through methods like splitting orders. When looking at the market, one should not only focus on surface numbers but also pay attention to the logic behind the funds. In summary, the current market is in a recovery phase, but it is not a strong reversal. The main feature is reduced volume and rotation. We should objectively view the rises and falls, avoid blindly following trends, not panic and cut losses, and rationally understand the logic of market strength and weakness to maintain clarity in a complex market situation.

(Author: Shao Xiaohui)

     【Disclaimer】This article only represents the author's personal views and is not related to Hexun. Hexun maintains neutrality regarding the statements and opinions in the article and does not provide any express or implied guarantees regarding the accuracy, reliability, or completeness of the content. Readers should only use it for reference and bear all responsibilities themselves. Email: news_center@staff.hexun.com