Yesterday we said that at the end of October, A-shares will stand above 4,000 points, this is the task, the comment area is very lively, most people believe it, and some people say, don't you see how bad Hong Kong stocks have fallen?
Fortunately, Hong Kong stocks quickly slapped their faces, this matter is actually not so complicated, the overall situation has been laid out, the general trend has been formed, and some people want to block it, want to crack it, and want to sing down, it is all in vain. The logic in this is something we will make clearer today.
Yesterday, we published an article "Good and Bad Strangulation! After the National Day, the stock market rose all the way to 4,000 points, and the time was at the end of October", we said that A shares would stand above 4,000 points at the end of October.
Some people believe it, some people don't, it's normal, and we'll be more straightforward today.
There are two key questions here: Why 4000 points? Why the end of October?
First, 4,000 points is a key defensive threshold for Chinese assets, why? Let's look at historical data.
Do you remember when the last high was? How many points? It was 3731 points in February 2021, in fact, the stock market was good throughout 2021, with an average of more than 3500 points.
Many people may not know what 2021 means for China's economy.
China's economy in 2021 has several very important labels.
2021 was the best year for China's economy during the pandemic, with a GDP of 115 trillion yuan and a growth rate of 8.45%.
Some people say that it is because the epidemic in 2020 was very sudden and hit hard, this matter is not debated, let's take a look at a few landmark data.
2021 is the peak of China's real estate, with new home sales of 18.19 trillion yuan and second-hand housing sales of 7 trillion yuan, adding up to 25.19 trillion yuan.
2021 was a brilliant year for foreign trade, with imports and exports exceeding US$6 trillion for the first time, a year-on-year increase of 30%, of which exports increased by 29.9%.
2021 was also the peak of exports to the United States, exceeding $570 billion, how much in 2023? It has fallen to $500.3 billion.
Therefore, the stock market stands at 4,000 points, which is slightly higher than the 3,731 points in 2021, when the economy has been the best in the last five years, which is the best defensive position.
Second, the timing is important, why the end of October?
There are two important reasons for this, one is that since you want to defend, you must be in place quickly, and if it drags on for a long time, it will be too late, and it is easy to be exploited.
Second, the United States election is in early November, and after the new president is elected, it is not known what moths will come out.
Therefore, we need to stand in the best defensive position of 4,000 points before the end of October to calmly deal with possible changes and risks.
Someone asked, now that all kinds of news are flying all over the sky, how can we judge?
We believe that in such a major historical period, the micro technical analysis of the stock market can be used as a reference, but it is not decisive, and it is really necessary to look at two more fundamental issues: logic and general trend.
We have said many times that if the stock market wants to look at the long-term and value, it must look at the underlying logic and trend.
The logic is, why are Chinese assets rising? Why is the stock market rising? The general trend is domestic and international capital flows, what is the trend?
We have also said many times that the stock market is a capital market, and the capital market is essentially a problem of more money and less money.
The US dollar cut interest rates, in terms of logic and trend, China's assets will inevitably rise, and they cannot but rise.
Because the US dollar cut interest rate means that the tide of interest rate cuts by central banks is coming, a new global easing cycle has begun, a new round of bills have become hairy, and prices have risen again.
If we don't follow suit, the RMB will appreciate wildly, and exports will be gone?
In addition, if we don't follow the global easing, it means that people's wealth is expanding, and our wealth is standing still, and after a long time, who will become richer?
Therefore, whether it is global monetary tightening or easing, it is actually an interactive cycle in the general environment and cannot violate the law.
From the perspective of the trend of international capital flows, the US dollar will cut interest rates, all countries will cut interest rates, we will also cut interest rates, the flow of international hot money will accelerate, and our internal currency will also become more, where will the money go?
As we all know, the two major reservoirs of currency are the stock market and the property market, so much money does not enter the property market into the stock market, the current property market we do not say that you also know to invest cautiously, the stock market has become the largest reservoir.
In addition, some people have said in the past two days that the stock market has risen sharply, and the main thing is that our money has moved from savings and government bonds to the stock market.
Therefore, whether you look at the logic or the trend, the two major signals of the sharp rise in Chinese assets across the board are very obvious.
However, there is an important issue that we need to be aware of.
The problem is that the correction and volatility of the capital market are also inevitable.
On October 3, the Hong Kong stock market ran out of the rebound of the big and deep V, which has given us a sample, any capital market, is not only a money market, but also a psychological market, has been rising is the exception, volatility is the norm.
Therefore, in summary, after the National Day, the stock market will still rise, but not so fast, and there will be a phased adjustment, and it will eventually stand at 4,000 points at the end of October.