Core Viewpoint - The market is experiencing a significant reduction in trading volume, indicating a lack of conviction among investors, with a divergence between those holding cash and those holding stocks [1] Group 1: Market Dynamics - The current trading volume is estimated to be smaller than yesterday, with a trend of decreasing volume firmly established [1] - The market's temperature is ultimately determined by buying activity, and as the number of buyers decreases, the balance will inevitably tilt [1] - The average stock price index resembles a head-and-shoulders pattern, with the right shoulder lower than the left, suggesting potential market weakness [1] Group 2: Leading Stocks and Market Sentiment - Core leading stocks are essential indicators for assessing whether the market has reached its peak, as seen in historical trends from figures like Livermore and O'Neil [1] - The abandonment of leading stocks often precedes significant market downturns, with new leaders emerging from the aftermath of market turmoil [1] Group 3: Sector Performance - The recent strength in utility stocks signals a sign of market fatigue, as these stocks typically perform well when the overall market is struggling [1] - The resilience of the Shanghai Composite Index is attributed to the support from banks, insurance, and utility stocks, which tend to rally during market downturns [1] Group 4: Micro-cap Stocks - The stability of the micro-cap stock index is due to the active participation of traditional retail investors and quantitative private equity, especially when institutional investors withdraw [1] - There is a need for preparedness, as prolonged market friction could lead to significant declines in individual stocks, even if the Shanghai Composite Index does not experience substantial pullbacks [1]

Group 1 - Short-term sentiment remains active, while mid-term sentiment is diverging; a significant opportunity will arise when short to mid-term sentiment reaches a freezing point, which has not yet occurred [1] - The leading index, the ChiNext Index, appears to have reversed and established a new trend, with trading volume gradually shrinking; the short-term average volume has been below the mid-term average for a month [2] - One of the leading stocks, Victory Technology, has broken below the 50-day moving average and is about to undergo a convex reversal [3] Group 2 - The strength of the banking, insurance, and securities sectors is too weak, remaining under pressure from the 50-day moving average, making sustained upward movement unlikely [3] - The innovative drug sector is also under convex pressure, with occasional rebounds expected to be difficult to sustain [3] - The photovoltaic equipment sector shows a structured expansion in trading volume, with active accumulation at the bottom; the Relative Strength Ratio (RSR) has turned positive, indicating it is worth following [3]