Noon Review: The market opened lower and fluctuated in consolidation; cautious operation is still required under the background of reduced volume.

This morning, the market opened significantly lower, consistent with the prediction from observation one. After the opening, the market initially surged to 3906 points, then entered a phase of adjustment and retracement, dropping to 3893 points; subsequently, driven by sectors like banking, it fluctuated upward, reaching a maximum of 3916.29 points. Morning trading volume was 4793 billion yuan, approximately 300 billion yuan less than yesterday, with more stocks rising than falling.

Observation one had previously pointed out that today's core focus is whether the market can fill the downward gap after opening lower. From the morning's performance, the highest point did not truly fill the gap of 3916.33 points before adjusting downward again. This phenomenon is actually favorable—there is always upward attraction from the gap above the market.

Meanwhile, the midday market observation also mentioned key operational logic: given that the overall market has left an upward gap for two consecutive days and has not yet formed a valid upward breakout, it is still recommended that investors take profits moderately at higher levels and reduce positions; even if a downward adjustment occurs today, heavily positioned investors should avoid arbitrarily adding positions. In the absence of clear news,观望 should remain the preferred strategy.

Notably, during the morning market's upward rally to fill the 3916.33 point gap, over 3,200 stocks rose, marking the market's third consecutive day of gains. Drawing from past experience, profit-taking can be executed when there are two consecutive days of broad market gains, and with three consecutive days of gains, this strategy should be even more firmly implemented—there is no need to strictly wait for the upper-range trading signal mentioned in the morning review (unless there is currently no opportunity to sell profitable positions).

Overall, the morning market saw a shrinking volume with a pullback that failed to fully fill the upper gap, primarily consolidating above the 5-day moving average, indicating relatively strong short-term performance. However, caution is warranted: recent trading volumes have been gradually declining, which is unfavorable for the market's future direction. The current market is at a critical juncture with no clear direction. Without substantial positive news, the probability of a downward correction in the market will significantly increase.

Therefore, the morning review's operational strategy remains unchanged: investors who did not take profits and reduce positions near 3916 points in the morning should consider appropriately reducing their positions during the afternoon's upward rally; heavily positioned investors should avoid arbitrary additions now and instead wait until the market fills the lower gap before making decisions; light-positioned investors may follow the morning review's strategy, with the core focus being the anticipation of policy-related news from the upcoming planning meeting.

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