A-shares have once again hit a new low in trading volume today! Following yesterday's combined turnover of less than 500 billion yuan in the Shanghai and Shenzhen markets, today's transaction volume further shrank by 18.5 billion yuan, with a total turnover of 477.3 billion yuan for the entire day in the Shanghai and Shenzhen markets. What is happening with the continuous reduction in trading volume in A-shares, and is it really on the verge of a stock market liquidity crisis?

The continuous contraction of trading volume in the Shanghai and Shenzhen markets will trigger a series of issues for A-shares. Similar to today, the market maintained a narrow range of fluctuation throughout the day, with no activity on the trading floor, no amplitude or volatility, which naturally also leads to a loss of investment value. An abnormal surge occurred at the end of the day, and the three major indices all closed higher. How should we view this?

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Firstly: Since the peak on May 20th, the major indices have been on a downward trend, and this round of adjustment has been going on for nearly three months. As the adjustment period extends and the decline deepens, many investors see no hope for a rise and have completely lost confidence. The lack of confidence in A-shares is the main reason for the reduction in trading volume.

Secondly: Currently, A-shares are severely lacking in funds. Individual investors are almost all trapped, and those who are trapped are reluctant to cut their losses, so they can only choose to lie flat and do nothing. Institutions also dare not easily control the market and also choose to wait and see, especially after the recent global stock market turmoil, institutions are also afraid, so both individuals and institutions are in a state of observation, and the trading volume in the Shanghai and Shenzhen markets is bound to shrink.

Thirdly: The proportion of quantitative trading in the A-share trading volume is quite high. After the regulatory authorities introduced new regulations on quantitative trading and short selling, etc., the funds for quantitative and margin trading in A-shares were effectively restricted. When A-shares lose the trading funds of quantitative and short selling, the trading volume in the Shanghai and Shenzhen markets will significantly decrease.

Fourthly: There are concerns that A-shares will accelerate the decline. For the safety of the principal, many investors have a strong atmosphere of waiting and seeing. For example, the current three major index centers are still continuously moving downward, and the major moving averages are also extending downward. There are concerns that A-shares will still have a large volume of selling in the future, and everyone is afraid to trade easily, and the trading volume is forced to shrink.

How will A-shares perform tomorrow?

Recently, A-shares have fallen into a situation of "volumeless decline", and such a market is not optimistic, and we should be alert to the risk of "volume increase and decline".Predicting that the A-share market will continue to decline tomorrow, with a high probability of hitting a new low after a refresh and adjustment, in order to force the trapped chips to cut their losses, and at the same time to force the mysterious funds to come out to support the market. The greater purpose is to let the super large funds pick up cheap chips. To achieve these goals, the market can only continue to suppress and fall to find the bottom.

Perhaps many investors will think that the A-share market has already seen a low volume for more than four years, and low volume will see low prices and not fall. In fact, this is not the case. There are two reasons for the bearish outlook on tomorrow:

Reason one: It is precisely because today's A-share market has shrunk again, which further proves that the stock market has no capital support; when the stock market loses capital, it will fall into a problem of capital liquidity. The existing capital lies flat, and the outside capital waits and sees. In such a situation, if the A-share market wants to rise, unless the national team takes action, it can only be bearish.

Reason two: I always feel that the current adjustment of the A-share market is not in place. Although it is close to the bottom of the adjustment, it still lacks a final fall action, which is to say that it still needs to dig a pit. At present, the center of gravity of various major moving averages is moving down, and it will start to dig a pit mode at any time, so it is still bearish.

In summary, today's A-share market continues to be volatile and organized, and the market is not active, there is no fluctuation, there is no money-making effect, and there is no popularity, etc. All of this is due to the further shrinkage of the turnover of the Shanghai and Shenzhen markets, and the new low volume is refreshed again. Because today's new low volume has appeared again, it is even more worried about tomorrow's A-share market, and it continues to be bearish.

In short, the current A-share market is in a major change phase. It will either increase the volume of the pit and fall to the true bottom, or the mysterious funds will support the market and make a strong rise to get rid of the bottom. Please wait patiently for the direction of the choice.