It is said that 5 poor 6 absolutely 7 turned over, although the market did perform quite well today, stepping on the 5-day line to shock upward, and breaking through the 10-day line pressure level. According to Jingyang's analysis at the end of last week, the market fluctuated in a narrow range at the beginning of the week this week, and stabilized on the 10-day line in the middle of the week. Therefore, today's trend is significantly stronger than Jingyang expected, and the breakout time is a few days earlier. According to today's trend, there is a great momentum to fight a turnaround. But Jingyang couldn't be happy, because today's plate is indescribable, but fortunately, the situation improved a little bit in the afternoon......
Before moving on to today's market, let's take a look at why July is off to a good start, and whether the broader market will usher in a trend reversal?
In Jingyang's view, today's A-share market rose more than expected, mainly because there were obvious signs of improvement in the capital side, and the news was mixed, and it did not put pressure on the market. In last Friday's "June Finale Rebounds More Than Expected!" There are two good signals on the disk! There may be a meat market in July! In the article, Jingyang has analyzed in detail the trend of the day's market, as well as the new ideas for adjusting the positions of various funds hidden behind the intraday volume of CSI 300 ETF.
Among them, the most important change is the national team! Before last Friday, the strategy of the national team has been to only support nothing, and find a low and low absorption in the intraday when the market falls in a single day, and the purpose is also very clear, that is, to prevent the market from having a single-day long yin, causing market panic to intensify. However, the situation changed significantly last Friday, and when the market rebounded in the morning, the CSI 300 ETF began to increase its volume. It shows that the national team has completed the fund-raising action before last Friday, so it will quickly pull out of the cost zone, so that there is no chance to get on the bus!
Above is the action of the national team. In addition to the national team, there were also new moves by domestic institutions last Friday. On Friday afternoon, the market failed to hit the 10-day line and returned to near the 5-day line again. Since the volume of CSI 300 ETF can be stable in the afternoon, the afternoon trend is dominated by domestic institutions. The upward attack on the 10-day line does not break, indicating that the willingness to go long is not too strong, but the decline of the 5-day line meets support, indicating that domestic institutions are reluctant to sell.
Therefore, as of last Friday, whether it is the national team or domestic institutions, there are actually actions to increase positions, which is undoubtedly a good thing for the market trend this week.
In addition to the national team and domestic institutions, there is also a type of main force that can also influence the trend of the market, that is, northbound funds! In the past two months, northbound funds have been unilaterally and sharply reducing their positions, which has been analyzed many times in previous articles. Although so far, there has been no return of northbound funds, a major event that happened on the news side of the weekend will affect the flow of northbound funds in the next stage!
At the end of the week, "3 major events affecting A-shares over the weekend: big positives! Multiple ministries and commissions jointly issued a document to maintain stability! A counteroffensive is imminent! In the article, Jing Yang and everyone focused on the "convening of a blockbuster meeting of the central bank to resolutely prevent the risk of exchange rate overshoot".
This weekend, the Monetary Policy Committee of the People's Bank of China (PBOC) held its regular meeting in Beijing for the second quarter of 2024 (the 105th in total). Compared with the first quarter, the regular meeting continued to propose to "pay more attention to counter-cyclical adjustment" and "increase the implementation of the monetary policy that has been introduced", but pay more attention to the continuous effectiveness of the stock policy. As for the RMB exchange rate, this regular meeting did not propose to guide enterprises and financial institutions to adhere to the concept of "risk neutrality", but "resolutely guard against the risk of exchange rate overshoot". For the real estate market, this regular meeting emphasized the need to "fully understand the new changes in the supply and demand relationship of the real estate market".
The key to the inflow or outflow of northbound funds depends on two points: first, the mainland's economic fundamentals, the economic fundamentals are strong, and foreign capital will flow in and increase positions; Second, the size of the exchange rate difference between China and the United States, the exchange rate difference widens the outflow, and the exchange rate difference decreases the inflow.
In the past month or two, the RMB exchange rate has been declining unilaterally, and at the same time, the performance of various domestic economic data is relatively weak, which has caused the continuous outflow of foreign capital. This weekend, the central bank mentioned for the first time to prevent the risk of exchange rate overshoot, indicating that the recent trend of the RMB exchange rate has attracted the attention of the central bank, and stability maintenance measures will continue to land!
Seeing this, some friends may say that the RMB exchange rate has not appreciated sharply today? Why didn't the exchange rate market react to the central bank's statement?
In Jingyang's view, this situation is actually relatively normal. Capital is profit-seeking, especially international capital. When we see that the RMB exchange rate is already in a unilateral depreciation channel, we will not easily turn the gun around and turn it long. Therefore, the central bank's first speech often only brings a warning effect to the market! Judging from the time period from the central bank's speech to the exchange rate turning after the continuous depreciation of the RMB exchange rate in the past few years, it is often after the central bank has warned two or three times that the RMB exchange rate will turn even. In other words, the central bank's first speech is equivalent to pressing the countdown to the turn of the exchange rate to fluctuations!
In addition to the exchange rate, the trend of foreign capital is also affected by the domestic economic fundamentals, which is related to the second major event that happened on the news side this past weekend!
On the last day of June, the Bureau of Statistics disclosed the first set of important economic data PMI for June! According to the data, in June, the manufacturing purchasing managers' index (PMI) was 49.5%, the same as the previous month, and the prosperity of the manufacturing industry was basically stable. In June, the non-manufacturing business activity index was 50.5%, down 0.6 percentage points from the previous month, higher than the critical point, and the non-manufacturing industry continued to expand.
It is not difficult to see that the most important manufacturing PMI was still below the boom and bust line in June, basically the same as in May. To be honest, the performance of this data is very poor, so why did Jing Yang also mention that the PMI data in June will not have much negative impact on the market in this morning's [A-share fierce news]? In fact, the reason is very simple, the A-share market has been falling for more than a month, to a large extent, reflecting the negative fundamentals in advance. Therefore, Jingyang believes that as long as the PMI data in June does not continue to weaken significantly compared with May, the short-term impact on the market will not be large.
How to understand this sentence? Let's take a look at the PMI charts over the past few months! The PMI saw the top of the stage in March this year, then fell month by month, and returned to below the boom and bust line in May. After a series of weakening, June was flat compared to May, which may indicate that the quarterly economic downturn may be over, which gives the market hope that the economy has bottomed out!
Today, the Caixin manufacturing PMI was also released, recording 51.8, up 0.1 percentage points from May, higher than the boom and bust line for eight consecutive months, the highest since June 2021, indicating that the expansion of manufacturing production and business activities has accelerated. The difference between the official PMI of the Bureau of Statistics and the Caixin PMI has been explained many times before, so I will not repeat it here. The Caixin PMI has warmed, further enhancing the market's confidence that the economy has bottomed out!
The domestic economic fundamentals have bottomed out, and the central bank has maintained a stable exchange rate, so the pressure on the large net outflow of northbound funds will be significantly reduced!
It is not difficult to see that in the current entire market, whether it is the national team, domestic institutions, or northbound funds, they are more inclined to go long in the short term, which is the main reason why Jingyang judged that the market stepped on the 5-day line this week!
Does this mean that there will be a trend reversal in the A-share market next? I'm afraid it's hard too! From a technical point of view, the market stands above the 10-day line, which only indicates that the unilateral downward channel that has been in place for some time in the past period is over, but this does not mean that the market will usher in a trend reversal. Due to the fact that there are more hedging disks above, most of the market in July is a box shock structure!
Finally, Jing Yang will talk about the plate again! Today, the market is going very well, but the market is not satisfactory, the main reason is that the market has no main line hot spots. Under the positive stimulus, rare earths and real estate rose first today, and banks continued to strengthen, and these sectors drove the market upward. However, none of these sectors are the main hot spots in the near future, and there is no big money in front of them, and sustainability is a problem. The recent mainline hot technology stocks have seen a large pullback this morning, but fortunately, the decline narrowed in the afternoon.
That is to say, the whole market is very chaotic today, the market is strong, but the money-making effect is very poor. For a period of time in the future, the most feared thing is that the market will be stable, but the whole market will once again have an electric fan pattern, and the hot spots will be repeated for one-day or half-day tours, so even if the market does not fall, it is still difficult for everyone to make money!