Today, the A-share market experienced an adjustment. Although it appears strong on the surface, it has actually already fallen by more than 10%. The retail funds that bought in yesterday and today have been trapped. However, the current market sentiment remains very optimistic, and there is no awareness that risks are approaching. Everyone is looking forward to the adjustment ending quickly and questioning where this A-share decline will go.

Firstly, the adjustment of A-shares will not end in a short time. The real situation is that the adjustment has just begun. This is because:

1. The short-term increase in A-shares is huge and rapid, and it is of a strong stimulus nature.

From the end of September to yesterday, in just 10 trading days, A-shares soared by 985 points, a 37% increase. Today, the actual decline in the A-share market was less than 200 points, a drop of less than 5%. Such a short period, such a rapid rise, such a large trading volume, and almost daily widespread gains are unprecedented.

For this trend, the first judgment I exclude is that a bull market has come, followed by the possibility of a reversal. The overall positioning is a large-scale rebound. If we extend the time frame, this market is a counter-bounce towards the neckline position of the three major weekly tops built by the A-share market from 2021 to 2022.

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The highest point of this rebound in the market was 3674 points, which has entered or even exceeded this neckline position. Therefore, yesterday triggered a massive surge and retreat. For the trend of this wave of the market, everyone should study the trend of our A-shares over the past 7 years since 2017 when Trump took office, and then they will understand why there is such a market.

2. The market is top-heavy, with a huge volume at the top.

A-shares do not have a clear and long enough bottoming phase on the daily, weekly, and monthly lines. We compare the trading volume at the bottom to the "feet." Only with a long-term presence at the bottom and various main forces obtaining enough cheap chips can a significant increase have a foundation. Many people say that the previous decline was bottoming, but the answer is no. The bottom has no good news, so how can there be continuous good news at the bottom every day?

Yesterday, the trading volume of A-shares exceeded 350 billion yuan in just one day. This is not just a historical record; the high turnover rate also indicates that the perceptive main forces have begun to cash in massively. Above 3500 points, the main force funds have fled more than 400 billion yuan. Who took over these 400 billion high-position chips?

If the market wants to rise significantly again, it must break through the record of 350 billion yuan again, but this is very difficult. Today, the trading volume of A-shares is less than 300 billion yuan, indicating that the market index will adjust as the trading volume shrinks.Thirdly, individual stocks have seen significant gains. Attention should be paid to the possibility of a sharp decline in the securities sector tomorrow.

In just a few short days, there have been no shortage of stocks whose prices have doubled, which undoubtedly accumulates a large amount of profit-taking positions. As trading volume continues to shrink, with no one to take on these significantly rising stocks, their fate is to fall. The risk of individual stock declines is far greater than that of the broader market for retail investors. Therefore, for the upcoming adjustments, retail investors should pay close attention.

Secondly, I hold a pessimistic view on the trend of A-shares for tomorrow, which is expected to see a substantial decline, and one should be mindful of any rebound during the trading session.

Firstly, current factors demand a significant correction in A-shares. The technical indicators of the three major A-share indexes are severely blunted, and the substantial corrections in the A50 futures and the Hang Seng Index, along with the reasons mentioned above, all serve as evidence for a market decline. This is not subject to human will but follows market laws.

Especially the Bollinger Bands and the trend lines I shared in my article yesterday both indicate that the A-share market is poised for a downward trend. As for how it will decline, it depends on the speed and volume of capital entering the market.

Secondly, the A-share market is set to begin the process of filling the gap. The target for the A-share market tomorrow is the gap left on September 30th.

This rebound was purely for show and left several vulnerabilities, or gaps. Today, the gap from yesterday's high opening was filled, and tomorrow, the market will aim to fill the gap from September 30th, which is between 3087 and 3153 points.

This gap is precisely within the daily Bollinger Bands of the market index. Filling the gap means the market index needs to return within the Bollinger Bands. There is an especially interesting question here: if we judge the market adjustment's position to be at the middle rail of the Bollinger Bands, then it would mean breaking below 3000 points, because the middle rail of the Bollinger Bands is at 2859 points today, and considering its current upward trend, we temporarily predict the market adjustment target to be at the 3000-point level.Only when the A-share market reaches the range of 3000-3100 points can it possibly exhibit a pattern of fluctuating and climbing. In other words, this wave of adjustment needs to slow down and change its posture to initiate a rebound, stabilizing the index while waiting for the leading figure from across the ocean to emerge next month.

Thirdly, everyone should pay attention to many recent events.

Recently, there have been many interesting occurrences, such as securities firms encouraging people to open accounts, claiming that it's a great bull market, and suggesting that if one doesn't want to buy stocks, they can invest in funds and ETFs. On the other hand, there is an overwhelming chorus advocating that pullbacks are opportunities to buy. What does this indicate? It suggests that the retail investors who were planning to enter the market have mostly done so on Tuesday and today, effectively becoming the first crop of "leeks" to be harvested.