Core conclusion: if the Q1 index fluctuates very violently (the index amplitude exceeds 15%), January will generally be the starting point of this fluctuation. For example, the first wave of decline (- 15.4%) caused by the epidemic in January 2020 began on January 14. In the first quarter of 2019, the index rose by 28.2%, starting from January 4. The most drastic decline in Q1 in 2018 began on January 25, with the largest decline of - 14.6%. The biggest decline in 2016 began on January 4. This is mainly because at the beginning of the year, due to the adjustment of assessment cycle and the need of fund allocation, the funds and positions of various investors are easy to fluctuate greatly. From January, we need to focus on verifying the activity of residents' funds and the improvement of credit brought by stable growth. If both factors are optimistic, the cross-year market can last until March. Otherwise, January may be the end of this wave of cross-year market.
(1) If Q1 fluctuates at a large level, January is crucial. Although there have been many voices discussing the cross year market and spring agitation since November, the core time period of the spring market is mainly the first quarter, and because of its duration, it often does not implement the whole first quarter. Then January will be very critical. If there is a large adjustment in the stock market in January, the rise from February to March will be very certain. If it rises in January, it basically means that the market in March will be relatively weak.
Another more important point is that if the Q1 index fluctuates very violently (the index amplitude exceeds 15%), January will generally be the starting point of this fluctuation. For example, the first wave of decline (- 15.4%) caused by the epidemic in January 2020 began on January 14. In the first quarter of 2019, the index rose by 28.2%, starting from January 4. The most drastic decline in Q1 in 2018 began on January 25, with the largest decline of - 14.6%. The biggest decline in 2016 began on January 4.
(2) At the beginning of the year, investors' funds and positions are prone to large fluctuations. Since January every year, the stock market will fluctuate greatly, mainly because the funds and positions of various investors are easy to fluctuate greatly at the beginning of the year. In early 2018 and early 2020, there was a large amount of fund issuance, but due to the impact of deleveraging and the epidemic, the stock market only rose to the middle and late January, and then there were major adjustments. In Q1 2019, there were not many new funds, but the stock of individual investors and institutional investors increased their positions significantly. The average position of partial stock hybrid funds increased by 7.7% in a single quarter, and the shareholding ratio rose from a very low level to a medium level in history. The decline in January 2016 began on January 4. The important background behind it is that the funds entering near the bull market peak in 2015 began to leave strategically after the stock market rebounded. The settlement funds of securities trading rapidly decreased from 2 trillion in December to 1.5 trillion at the end of January.
(3) Profit expectation in January 2022: focus on the strength of credit recovery. This year's cross year market, the main variable affecting profit expectation is steady growth. Since the central economic work conference in December, the policy tone of steady growth has been clear and deeply rooted in the hearts of the people. However, if the steady growth market is expected to continue to ferment, it is necessary to verify the credit intensity in January.
Risk factors: the real estate market fell more than expected, and US stocks fluctuated sharply.
