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It's June now, and the most discussed topic in the market is the direction the market trend will take.

The 2023 version is "poor in May, desperate in June, and turn over in July," which makes people think whether 2024 will replicate the market trend of 2023.

Of course, the July turnaround in 2023 occurred at the end of July, and it only lasted for about two weeks. In late August, the market started a sharp decline again.

In 2022, the market rose in May and June, but fell directly in July.

In fact, the market rumor of "poor in May, desperate in June, and turn over in July" has no direct connection with the A-share market.

This saying was derived from the cyclical pattern of the Hong Kong stock market from 1980 to 1990 at that time.

At that time, the Hong Kong market would often fall in May and June, and rise in July, and this pattern was summarized by the market.

Of course, the "desperation in June" has some truth to it, because June is the middle of the year, and the financial pressure is relatively large. All major markets will have a certain blood-drawing effect, so the market often shows a reduction in volume and a decline in June.

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Even in the big bull market of 2007, there was a significant adjustment in June.

In the big bull market of 2015, it came to an abrupt end in June.It is evident that regardless of a bull or bear market, the impact of the "June curse" on the stock market is quite significant.

Currently, it is June again, and it is uncertain whether this year's A-shares can escape the fate of the "June curse."

The so-called "July turnaround" is mainly due to the large number of mid-year reports being disclosed in July.

Companies that can disclose their mid-year reports in July are generally those with positive mid-year results, while some less competitive companies tend to disclose their reports in August.

Therefore, during this time period, if the market previously lacked hot spots, there will be a round of mid-year report speculation.

In other words, a market that cannot find hot spots will emerge with some themes, driving the market's popularity.

Thus, if the market performance in May and June is indeed not ideal, there may be some reversals in July.

This is the interpretation of the time cycle relationship from the market's perspective, known as "May poverty, June curse, and July turnaround."

However, if the market performance in May and June does not follow the script, then there is no such thing as a "July turnaround" to speak of.The reason why the saying "poverty in May, despair in June, and a turnaround in July" will reappear this year is due to several negative signals that emerged in the market's performance in May.

Firstly, the market has a structure and trend of building a high-level top. If the market were still in an upward trend in May, there would be no such saying as "poverty in May, despair in June, and a turnaround in July." However, the market experienced a rise and fall in May. From the daily line structure, it is a short-term top structure, and from the overall trend, apart from the Shanghai Composite Index, several other indices have also begun to show a clear trend of weakening.

This may not necessarily be a significant or deep adjustment, but it must be a structural adjustment that requires a cycle. So if the adjustment starts in mid-to-late May, it is undoubtedly that June will be in the adjustment cycle. Therefore, a turnaround in July is also in line with the market's cyclical law.

Secondly, the market has experienced a severe reduction in trading volume.Volume contraction is a harbinger of poverty and despair.

By poverty and despair, it is not necessarily that the market must fall by a certain amount, but that the market has no capital participation.

The current market turnover of 500 billion is inclined to be quantitative transactions.

That is, some arbitrage funds that will trade regardless of the market conditions, good or bad.

The funds that are really doing the market or speculation have decreased by tens of billions in the past two months.

At the end of February, the largest turnover was 1.35 trillion, and at the end of April, there was still a single-day turnover of about 1.2 trillion.

But now it is very reluctant to only have 70 billion, and 50 billion of funds have disappeared.

Poverty refers to the reluctance of capital to invest, and despair refers to the fact that capital has nowhere to go. If the market continues to contract in volume, it is only natural that the market becomes more and more embarrassing.

Third, the market's hot spots have shown a clear sign of extinguishing.

One of the major characteristics of the "May poverty and June despair" is actually the market's hot spots, or the main line, extinguishing.The term "Six Extinction" refers to the extinction of market hotspots.

April is the season for quarterly reports, and if May continues to build the top, it is indeed possible that there may be no hotspots in June.

But June has just begun, so many things still need to be observed.

If the trading volume is maintained below 70 billion for a long time and no new hotspots emerge, then the risk of "Six Extinction" does indeed exist.

But even if there is a lack of hotspots, it will not continue to fall, and the market will try to find something edible even if it turns over the garbage can.

Is it possible for June to have no adjustments and show a trend of fluctuating upward?

The possibility is very small.

For the market to continue the upward trend, several conditions need to be met.

1. Find a new hot main line as soon as possible.There is a main thread of hype in any market trend, which is the law of the market.

Even if it's just a blue-chip stock, it's a hot spot, it's a main thread.

But in the past month, after the low-level economy has stalled, there has been no real hot main thread.

Real estate and the like are all transient, with no sustainability.

The market must have new themes or new main threads that can attract enough capital to revive.

2. The trading volume returns to a reasonable level.

Without a hundred billion, this market cannot really get out of the market trend.

In other words, without the participation of large enough players, this market cannot improve.

Players need to return to their positions first, and capital needs to be active first, so that the market has the foundation to develop.

However, there is a process for the increase in volume, or the return of capital requires a relatively low point, or a trigger point.At this moment, we can only wait and observe whether the market shows any signs of improvement.

3. Major indices show a synchronized upward trend.

This year's indices are not very coordinated, to put it bluntly, there is no widespread rise.

The Shanghai Composite Index's trend is obviously better than other indices.

However, in some stages, the growth of the ChiNext and STAR Market may also be better than the Shanghai Composite Index.

The bottoming process of major indices may not be the same, or the stages they are in may differ to some extent.

The market stems from the resonance of major indices, not differentiation, so a consistent widespread rise at this point may provide a better opportunity.

In fact, we all hope that June will be a good month, but we should also be prepared for June to be an adjustment month.

The overall market environment of A-shares this year will be better than in 2023.

Even if it is an adjustment month, it doesn't matter, because only through adjustments can the market's upward space be opened up.If the adjustments in June are sufficiently thorough, then the market in July is still worth looking forward to.

As long as the market is not a one-sided bear market, there is always a time to turn around; just wait patiently.

What we need to do is mainly to observe the changes calmly and not to view the market based on subjective ideas lightly.