Hexun Investment Advisor Wang Haiyang: The Market Closed with a Lower Shadow, Where is the Adjustment Target?

Today, the market index once again fell below 4050, confirming our recent emphasis that the market would likely retest this level, and there is a high probability it will break through 4050. During today’s trading, the index dropped below 4050 again, then recovered in the afternoon, which shows that the 4050 level has already formed three lower shadow lines.

Wang Haiyang from Hexun Investment Advisory stated that the repeated lower shadows at this level indicate that it must be broken. At the same time, this also shows that the support at 4050 is relatively strong because it was pulled back three times during declines. Since the market fell again today and then was pushed back up after breaking 4050, the lower shadow line also suggests that our index will continue to test downward in the near future. Therefore, 4050 is unlikely to be a true turning point.

Specifically, switching to the index, today the market again broke below 4050 during trading to defend the level. This long lower shadow already has three lower shadows, right? This makes it easy for the index to confirm downward movement again tomorrow. Currently, the gap in the Shenzhen Index has not been filled, and the gap in the ChiNext Index is still unfilled, which are potential risks for upcoming adjustments. The overall market volume has not yet shrunk, indicating that the correction has not ended. First, the volume during the retest on the right side should decrease; the signal of extremely low volume has not appeared. Therefore, the market still needs to continue downward pressure. In summary, the adjustment rhythm is not over, and the bottom-finding process on the right side has not finished. The market will likely break through 4050 again soon, testing around 4020. Until there is a clear sign of extremely low volume or narrow-range consolidation, the market’s correction will continue.