Two major favorables are coming! The offshore RMB suddenly soars, and the State-owned Assets Supervision and Administration Commission (SASAC) indicates that the total investment exceeds 3 trillion yuan, which has safeguarded the widespread rise of A-shares today, finally giving investors hope for an increase, with nearly 4,500 stocks rising at the close.

Today's market situation is as follows: in the early morning, stimulated by the sharp rise in the RMB, the bulls stimulated a wave of lifting, paving the way for a comprehensive rise. Small and medium-sized thematic stocks rebounded collectively, but soon the Shanghai Composite Index suffered a backlash, rising high and then falling, turning green and falling.

It is precisely because the SASAC indicated that the total investment exceeds 3 trillion yuan that today's equipment stocks, machinery stocks, and aviation stocks all rose significantly with increased trading volume. The rise of these sectors has indeed contributed a lot to today's market. However, despite the two major favorables supporting the widespread rise of A-shares today, there are still some shortcomings and regrets during the trading, as follows:

First: The Shanghai Composite Index was blocked at 2900 points and fell back after rising high. The index was almost held underwater all day, mainly due to the bank stocks being smashed down. Today's bank stocks became the strongest bear; insurance, resource stocks, and liquor stocks also fluctuated weakly, which also dragged down the Shanghai Composite Index today. The index failed to rise with increased volume, which is regrettable.

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Second: The widespread rise of individual stocks lacks a sense of security. Although today's small and medium-sized thematic stocks have become strong, apart from the equipment stocks and machinery stocks stimulated by the favorable news from the SASAC, which increased in volume, many other stocks did not increase in volume. A widespread rise without volume is unsustainable. Without volume, there is no momentum, so today's widespread rise indeed lacks a sense of security.

Third: In fact, today's widespread rise of A-shares, taking advantage of the favorables, is actually a technical rebound. The lifting during the trading is just a prelude to "luring more buyers," not a signal of "stopping the decline and reversing." To put it bluntly, the widespread rise of A-shares today is not optimistic. It is a typical rebound in the middle of a decline, and after a brief rebound, it will continue to seek the bottom.

Fourth: The phased adjustment of A-shares has not yet ended. If today's market was not boosted by the two major favorables, the trend would probably be ugly! It is precisely because the adjustment has not yet ended that today's market still sees selling pressure, with external funds still waiting and watching, and investor confidence is insufficient. These are the current shortcomings of A-shares.

Can A-shares continue to rise widely next week?

As analyzed above, today's widespread rise of A-shares is just a rebound in the middle of a decline, which is a kind of luring more buyers' market. Such a market will not continue, so the probability of a continued widespread rise next week is low.

If today's A-shares really belong to the luring more buyers' market, next week's A-shares could be returned to their original state at any time and cannot sustain a widespread rise. On the contrary, after a short-term luring more buyers, next week may still probe further to cut the "chives" (a metaphor for inexperienced investors). For safety reasons, investors should still be cautious about today's widespread rise market.(1) Based on today's performance of A-shares, this rebound is indeed somewhat weak. It is quite evident that it was stimulated by two major positive factors. After the realization of these positives, they turned into negatives. Therefore, the substantial appreciation of the Chinese yuan and the investment of 3 trillion yuan, once realized, will become negatives for next week.

(2) A general rise in thematic stocks cannot drive the sustained increase of A-shares. Thematic stocks simply cannot lift the entire stock market, thus proving their difficulty in sustaining. Moreover, after today's general rise, thematic stocks will inevitably enter a phase of differentiation next week, with those having volume continuing to rise, and those without volume returning to a downward trend.

(3) Although the bulls in A-shares hold an advantageous position today, it is regrettable that the trading volume of the Shanghai and Shenzhen markets is insufficient. The trading volume of the two markets has always been maintained around 600 billion, which is far from enough to support the continued general rise of A-shares next week.

Summary

From the above analysis, it is understood that today's general rise in A-shares was a signal to "lure more buyers" due to insufficient volume, heavy selling by heavyweight stocks, lack of investment, and insufficient confidence. It was entirely stimulated by the substantial appreciation of the Chinese yuan and the positive news released by the State-owned Assets Supervision and Administration Commission. Once these two positives are realized, they will turn into negatives, making it difficult for A-shares to continue a general rise next week.

In conclusion, the general rise in thematic stocks is hard to sustain. To avoid becoming the "bag holder" for thematic stocks, do not blindly chase highs and wait patiently for a good opportunity to enter after A-shares have truly stopped falling and stabilized.