Yesterday, the non-agricultural data was released, which was good for the financial market. The market expected that the interest rate cut in September was a foregone conclusion, and there was even a possibility of a 50 basis point cut. However, even with such good news, the market still fell, which made many people further believe that the market will fall sharply. On the surface, good news does not lead to a rise, and bad news is more likely to fall, which seems to prove the market's bearish expectations. But I think this is a deliberate "short inducement" situation created by the main force.
Why do I say that? Retail investors are always easily affected by market fluctuations. The trend of the past few months has made most people believe that a big drop will come. Therefore, the main force takes advantage of the trend and makes retail investors fall into the misunderstanding of their self-proclaimed "superb analysis". Seeing that the market continues to fall after the good news comes out, this will make retail investors more convinced of the bearish judgment of the market and further manipulated by the market. And I think this is precisely the precursor to a reversal.
From the market, the recent highs and lows are constantly decreasing, but no new lows have been created. Although yesterday's decline formed a large negative line, the trading volume was reduced and there was a lower shadow. This shows that at the current position, the market is likely to stop falling. As long as the stop-loss signal appears next and no new lows are created, the entire market will enter a new bull market stage. The market trend in the past few days is crucial, and the appearance of the stop-loss signal may mean the beginning of the bull market.
Many people ask me, since the market fluctuates so much, why don't you choose to sell and wait for the correction to end before buying back? In fact, this is the difference between long-term and short-term thinking. Long-term investors focus on the overall situation and can bear certain floating losses because they are aiming for greater potential returns. If you choose to sell every time the market fluctuates, you are actually trapped in a short-term trading mindset.
Imagine if you worry about a pullback every time the market goes up, and you are afraid of profit taking, then you will be eager to sell when you make 10 or 20 points. How can you hold on to 10 or 20 times the profit with such a mindset? The key is, who can 100% judge the high and low points of each short-term trade? I have never met such an expert. Once you start short-term trading, your greed will expand, and you will want to get more profits through the band, but you may eventually be thrown off the train and lose the original long-term opportunity.
Just like running a store and doing business, it is impossible to make money every day. Faced with floating losses and unprofitable situations, do you choose to close the store for a few days and then reopen it? This unstable strategy will only lead to business failure in the end. Similarly, if investors cannot bear short-term floating losses, it will be difficult to seize dozens of times the returns in the market. The important thing is to maintain patience and confidence and avoid frequent operations in short-term fluctuations.
In summary, the current market is at a critical turning point. Although the short-term shock and correction may make many people feel anxious and uneasy, I believe that the signal of stopping the decline will soon appear. For those investors who adhere to the long-term strategy, patiently waiting for the market to rebound is the only way to greater returns.
Finally, there are still many things that are not written down, such as specific opportunities and specific decisions. These things are often not something that can be summarized in one article.
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