On August 5th, the proportion of A-share stocks with a turnover rate below 3% fell to 65.74% from near its April high, marking the first decline since July 21st. The proportion of stocks with a turnover rate above 5% rose to 17.14%, also a first decline since July 21st. Currently hovering near the threshold level, attention should be paid to whether market trading activity can stop falling and continue to recover.
-------- Note: 1. When the proportion of stocks with a turnover rate below 3% increases, especially near historical highs (dashed line in the chart, representing a reversal trend), it means the market is likely to encounter a temporary low, making a reversal or rebound likely.
2. When the proportion of stocks with a turnover rate above 5% remains above the threshold (dashed line in the chart), a strong profit-making effect emerges in the market, making the rally sustainable. During a bull market, this indicator will consistently remain above the threshold, leading to a broad-based market rally; while during a bear market, this indicator is mostly below the threshold, and occasionally exceeding the threshold should be viewed with caution due to the risk of a pullback after a surge.
