Yesterday's outlook for the stock market suggested that the market trend might continue to exhibit two distinct patterns. Today's performance has largely continued these two patterns, as the Shanghai Composite Index once again hit a new low (it has been mentioned several times before that the index has broken new lows, but today it truly did so again; the low point of the Shanghai Composite Index on September 5th was 2,777.47 points).
However, when looking at the Shenzhen Component and ChiNext indices, it can be observed that neither of these indices broke new lows. In fact, both the Shenzhen Component and ChiNext indices even surpassed yesterday's highs today, just as was mentioned yesterday. The Shanghai Composite Index might continue to face heavy downpours, while the Shenzhen Component and ChiNext might close higher.
To put it simply, regarding the Shanghai Composite Index hitting a new low again today, it must be reiterated that in the stock market, everyone must be vigilant about such occurrences. Do not immediately jump to the conclusion that "what does not break will not stand" just because the market has risen after breaking a new low.
In the stock market, breaking a new low does not necessarily mean it will stand, because if the market would stand up every time it broke a new low, then since September 2nd, which was Monday, the Shanghai Composite Index has been breaking new lows for several consecutive days, and yet we have not seen its trend stand up.
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Everyone should prepare in advance for the possibility of a significant correction tomorrow (September 6th). Here is a personal view on tomorrow's market: I believe that tomorrow's trend may not necessarily bring about a significant correction. Why is the outlook for today's market uncertain? It's quite understandable because the current trend has become increasingly complex, and at this time, the outlook for the market may also require more detail.
Of course, to be more straightforward, I believe that as long as the Shanghai Composite Index does not break a new low again tomorrow morning, the stock market may not face a significant correction. However, if the index breaks a new low in the morning, even if there is a rebound later, I still think the stock market might experience a significant correction tomorrow.
Naturally, after using the term "not necessarily," some might question whether it implies uncertainty. In fact, there is no need for excessive explanation on this point, as previously mentioned, when the stock market's trend is simple, a simple outlook can be used. When the market's trend is complex, a detailed outlook is needed. Of course, the above is just a personal opinion and should not be taken as investment advice.
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