Today's A-share market once again staged a sneak attack at the end of the trading day. It seems that the main force has become addicted to such tactics. We often talk about how some stocks can be played with just one cent for the whole day. The A-share market is even more peculiar, with a single China Petroleum playing with the overall market for a whole day, holding on for three hours, and even the timing of the dive is very precise. At exactly 2 p.m., they launched the sneak attack at the end of the trading day. This time, it was a dive, and then a few points were raised at the end of the day, which can be considered as a comforter. Below, I will discuss with you how to understand the intentions of the main force and communicate with you on this topic.
Firstly, when you trade stocks, you are not only buying stocks and the opportunity to make money, but also buying risks, that is, the opportunity to lose money. Most of the rebounds that occur in a downtrend are short-term trends. If you regard this kind of oversold rebound as a big market, you are destined to bet on the wrong horse.
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The rebound of A-shares started on February 6th and has already been more than two months. We estimate that this wave of the market has actually ended on February 28th, based on the historical duration of each rescue market in A-shares, which is mostly 2-3 months. Because that day saw the largest volume of this rebound, which is also a historical record in the past 8 years - 130 billion yuan.
The counter-encirclement trend on February 29th was the beginning of the temptation to sell more goods in this rebound, because from February 28th to now, there has not been a single day's trading volume exceeding 130 billion yuan, which is the role of the theory of volume and price.
At this time, the entire market could not hear any different voices, and the emotions of retail investors reached a climax. I was scolded every day, and I knew it was bad, the market's big turning point came, and the future market was trapped by a large amount of capital, because most of the rescue market was a high position with a large number of trapped plates.
Therefore, when buying stocks, you should not only think about making money. It is a very common truth that money is not easy to earn. If money is easy to earn, who would come to the stock market to worry all day, and confidence is destroyed again and again, causing people's rationality to change greatly, not to mention the loss, and finally making oneself nervous. For most retail investors, the stock market is a new field, or a strange existence. Human nature is that when you arrive at a new field, you are excited and dare to boldly look forward to the future. To speak frankly, it is blind confidence, thinking that the person who loses money is always someone else, and it will never be yourself. But reality tells you, you are also the one who loses money, and you are no smarter or luckier than anyone else.Secondly, when we trade stocks, especially A-shares, you must understand which group of main forces is driving the market at a certain stage. At the very least, you need to know which market makers, euphemistically referred to as the main forces, exist in the A-share market. People often ask me, "You always talk about selling, who bought it? Do retail investors have such a big ability?" This is a typical friend who doesn't understand A-shares at all. His thinking is limited to how retail investors can do it.
He overestimates retail investors. In A-shares, retail investors are the most basic existence. They have no means. Can you short sell? Can you do margin trading? Can you trade on the Beijing Stock Exchange or the Science and Technology Innovation Board? Can you do margin financing and securities lending? Can you do T+0? None of these are possible. Those who can do it are not retail investors, but medium-sized or large investors, because there are thresholds.
The current ecology of A-share market makers can be divided into the following categories: top-level market makers, large market makers, medium-sized market makers, medium-sized institutions, private equity, and so on.
The top-level includes social security and insurance funds, Central Huijin Investment Ltd. and China Securities Finance Corp., large market makers include securities business operated by state-owned enterprises and state-owned enterprises, medium-sized market makers include securities business of securities firms, more than 10,000 funds, and some large listed companies' own securities business. Below are countless private equity, quantitative, medium-sized, and large investors, and finally, retail investors. I forgot, there is also foreign capital.
Excluding retail investors, the net outflow of hundreds of billions of main force funds every day can be taken over by a few market makers. However, market makers are not omnipotent. When they suffer losses, they look very ugly, which is generally invisible to retail investors. Funds need to disclose performance, so although it is data from three months ago, we can still get a glimpse. A few years ago, these so-called star funds were simply losing money stars.
In a certain period, there are different groups of market makers to make a wave of the market. The above-mentioned top-level main forces generally do not participate in the market, they only play a guiding role, because the absolute low point before the start of a big bull market is accurately stepped on by the top-level main forces.
Usually, they do not appear to have large fluctuations, but this rebound is a rebound made by the top-level main forces. The above three main force groups collectively participated in the market rescue in the 2015 stock disaster, which was their deepest involvement. This time, they are also deeply involved, so that they have to support the stock index and carry the sedan chair for others.The biggest issue is that the overall market's capacity to absorb is insufficient, and the outflow of goods is not very smooth. Although on February 28th, the main force fled with 73.6 billion yuan, and subsequently there were several instances of a net outflow of 4 billion yuan in a single day, this is just a drop in the ocean compared to the actual circulating market value.
Thirdly, everyone should be clear about the good intentions of the major forces, and be adept at steering with the wind, going with the flow.
If the current market experiences a rapid decline, the most severely affected will undoubtedly be the majority of retail investors. At this time, we should better understand the good intentions of the major forces. Whether it's protecting the market or playing with a single PetroChina for a day, these are not the most critical issues. The most critical issue is that the market has already made it very clear to you that the market is going to readjust, but you think it's going to soar, and if you get stuck, whose fault is it?
After the market completed a rapid rise on February 28th, it was also the time for us retail investors to pay attention to exiting. From the data reflected from all aspects, retail investors are continuously pouring in at this time, and most of them are newcomers, who are intoxicated by the idea of getting rich and finally get stuck. Who can they blame?
The market set a new high of 3090 points on March 21st, which also provided us with an excellent opportunity to exit. If you don't leave, the market has been rising for three consecutive days on March 28th, once again providing everyone with the opportunity to exit. If you want to operate in the opposite direction and insist on holding the stock, stock trading is a business, but I see that many people are here to vent their anger, and it's no wonder you lose.
Therefore, as retail investors, they are like lovely deer in the deep forest, the target of fierce beasts. You don't understand anything and are unwilling to learn. At critical moments, you can't read the painstaking efforts of the major forces and the market information, and finally get stuck, which is heartbreaking.
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