After six consecutive days of gains, what’s the next move? This is the most brain-burning question in the recent market.

Yesterday, the main index surged to 3947 points, continuing its upward trend, but trading volume has not yet picked up — which is very critical. However, the market did not pause; instead, individual stock enthusiasm exploded, with over 4000 stocks rising, especially small-cap and thematic stocks surging wildly. As the index approaches the 4000-point threshold, today’s performance will be the real test.

**First, the most eye-catching phenomenon**

Today’s most interesting aspect isn’t the index itself, but this wave of "big reversal." The day before yesterday, large-cap stocks led the rally while small-cap stocks were despised; today, they immediately turned around — small-cap thematic stocks aggressively pushed higher, while large-cap stocks became a drag. Market divergence is becoming more extreme. What does this imply? Capital is voting; not all sectors are equally favored.

Although volume has not kept pace, the index is still being pushed upward stubbornly, reflecting a strong determination to maintain stability at year-end. Without new outside funds, it’s relying on daily gains to inch closer to 4000 — this intention is unmistakable.

**Concerns over insufficient volume**

From 3937 points to 3947 points, just a 10-point difference, and the pressure zone around 3950 is very close. If tomorrow’s opening slightly pushes higher, the dense pressure zone will immediately surface. After six days of gains, can the index continue to close higher? Honestly, there is an expectation for further rise, but the probability of closing positive all day is actually not high.

There are two reasons worth pondering: one is that the change in individual stock sentiment needs time to verify. Yesterday’s broad decline and today’s broad rise — who can guarantee that tomorrow won’t fall back into the old pattern of "lifting the index while dragging down individual stocks"? Without signals of sustained sentiment warming, blindly increasing positions is gambling. After all, no matter how much the index stabilizes, it ultimately depends on whether individual stocks can keep pace. The other is that the trend of volume is crucial. Today’s volume shrank while prices rose broadly; if volume continues to dry up tomorrow, intra-market funds will quickly shift to risk aversion, and the broad rally in stocks could instantly collapse, bringing divergence to the surface.

While we can remain cautiously optimistic about the index, individual stock sentiment is far from stable. The market’s essence at the moment remains a rotation game. Those holding unrealized losses can patiently wait, and retail investors wanting to add positions might as well observe a bit longer.

**The RMB appreciation signal cannot be ignored**

Recently, a rather positive signal has been brewing — the RMB exchange rate is appreciating. When the exchange rate surged intraday a couple of days ago, A-shares showed a divergence with some stocks falling more than rising, because a strengthening currency often scares off some funds in advance. As this change becomes more obvious, more people are paying attention, and market confidence is gradually recovering.

The US dollar index is weakening, and expectations for the RMB to passively appreciate are growing stronger, making funds more optimistic about medium-term domestic assets. Yesterday, the RMB briefly broke through 7.01, and if this momentum continues, breaking 7 next year is worth expecting. A stronger exchange rate could trigger a wave of excitement around the Spring Festival period.

But in the short term, 7.00 remains a critical threshold. If the exchange rate stalls at the current level, the upside space for A-shares will be locked; only when it truly breaks through 7 can market sentiment and capital confidence be fully ignited. Moving forward, close monitoring is needed: will the RMB enter a short-term oscillation mode, or will it accelerate its appreciation?

**Tomorrow’s focus and risks**

Looking ahead to Thursday, the 3950-point level remains a big trap. A detail to watch is that Hong Kong stocks are closed for the holiday, and US markets will close early tonight, so tomorrow’s A-share market will be entirely driven by domestic capital — any movement will be amplified.

Today’s tech sector exploded across the board. If tomorrow’s opening sees a lack of enthusiasm in thematic stocks, and the index only relies on heavyweight stocks for a symbolic push, that stock could revert to the old pattern of "more declines than advances," and downside risk should be heeded. Currently, the index is stuck at a critical level: above is the 4000-point threshold, below is a need to retest 3900 for support. Will it surge straight to 4000, or pull back first to gather strength for another push? The answer may come as soon as tomorrow.

The current strategy should be to watch more and act less, letting the market choose its direction: if a rebound followed by a pullback occurs, it’s likely a short-term retest of support, which would be a good time to add positions; if the index breaks through strongly, maintaining a light position of around 50% is sufficient to cope with the situation.