Control your position well, watch more and move less!

$Shanghai Composite Index sh000001$ Today, the A-share market saw a rebound and recovery. The market looks a bit warmer, but honestly, the overall situation is still unstable. Both internal and external pressures haven't been fully digested, so don't be too optimistic.

Why is it unstable:

First, external factors are not supportive. Japanese and South Korean stock markets opened higher and surged this morning, but ended up falling back. The sentiment across the entire Asia-Pacific market is timid and hesitant to move forward, which is definitely a drag on our A-shares, given the overall environment.

Second, our biggest internal risk—quantitative funds. In the current market, whenever the index rises slightly, quantitative funds start arbitrage and selling. This problem hasn't been fixed. This rebound is inherently weak after a continuous decline, lacking confidence. Any rise triggers the selling instructions of quantitative funds, so it's hard to say if this rebound can sustain. It's naturally limited.

Third, and the most concerning, is the geopolitical risk hanging overhead. Donald Trump's final warning deadline for Iran is tomorrow morning at 8 a.m. If no agreement is reached by then, conflict is likely to escalate. This is also the core reason why capital is most fearful and unwilling to enter the market in a big way. No one wants to take risks before the news becomes clear.

So, to put it bluntly, today's A-share rebound is a "weak recovery" under both internal and external pressure. Whether it can withstand this wave depends on whether capital has the confidence and the courage to enter the market.

Of course, there is good news. There's a positive signal in the market: over 4,000 stocks rose today. This is much more reliable than just pulling up the index. At least there's a profit effect, not just index gains without real money. Also, the Shanghai Composite Index is still oscillating within the range of 3810 to 4020 points, not breaking out.

But the shortcomings are also very obvious: trading volume hasn't kept up, hasn't expanded, indicating that capital is on the sidelines, afraid to move. Even those optimistic about post-holiday market conditions don't dare to bottom-fish easily now, given the high uncertainty. No one wants to be the "naive investor" getting harvested.

As for the Middle East issue, it certainly won't calm down in the short term. There are only two scenarios:

Either the conflict escalates directly, in which case the stock market will likely experience another "final drop," flushing out all panic selling. Or it falls into a prolonged stalemate, in which case the market will enter a long period of oscillating and grinding at the bottom, slowly enduring.

I'm not pessimistic about today's market. Localized recovery should continue, but it absolutely cannot be said that the decline has stopped and stabilized. Don't blindly bottom-fish; it's easy to step into a trap.

Actually, it's not just our A-shares. The entire Asia-Pacific market experienced a high-open-and-fall-back today. Everyone is worried about the same thing: simply put, waiting for Trump's final deadline to pass, waiting for the news to become completely clear before capital dares to act with confidence.

Additionally, it's now the window period for earnings disclosures. The chemicals sector is favored by capital due to its high certainty—it's experiencing price increases and can also serve as a hedge, making it a relatively safe direction. In the short term, it's recommended to continue watching the chemicals sector. Opportunities for buying on dips can be noted, but don't chase highs. After all, the market is unstable, and safety is the most important.