The last decline before the arrival of the bull market will often lead to the decline of leading stocks that once led the rise in the previous period, or the stock that is generally optimistic by investors will plummet. In addition, it also includes the sinking of large-cap index stocks that have a great influence on the index. The decline of such stocks will often cause heavy psychological pressure on investors, prompting investors to generally turn to bearish market outlook, thus completing the last decline of the market.

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1, the first stage is from 1996 1 to 1997 in May. At this stage, the PE of A shares increased from 17. 14 times to 60.92 times, with an increase of 255.35%. So this stage is also called valuation market. The catalyst of this valuation market is the reduction of the subsidy rate for value preservation, which brings opportunities for the transfer of residents' deposits. From 65438 to 0996, the number of A-share accounts rose sharply, and the liquidity of the stock market plummeted. In addition, the central bank cut interest rates many times, which is also an important driver of the market.

2. The second stage is from May 1997 to February 1999. The market changed from valuation-driven to performance-driven, but in the process, it encountered the Asian financial crisis, which led to a large selling pressure on the market. It was not until May 1999 that it began to change, and it was called the famous ". On May 18, 2008, the CSRC held a special meeting in Beijing and conveyed eight opinions to the eight major securities companies, including requiring capital to enter the market, reducing stamp duty and allowing state-owned enterprises to subscribe for new shares. 199965438+from February to June, 20065438+0, the market showed a situation in Shuang Sheng in terms of valuation and performance, that is, Davis double-clicked and the bull market reached a crazy stage. The main catalysts are policy support, rising external market and economic recovery.

3. After the bear market ends, there will be three bottoms in the market, namely valuation bottom, policy bottom and market bottom. These three bottoms have all fallen sharply, and the valuation bottom is the extent to which the market has fallen to valuable investment, so it can be considered as the valuation bottom. The bottom of the policy is that after the stock price has fallen sharply, some favorable policies are introduced to stimulate the stock market, which is often said to save the market. Then when these favorable policies are introduced, they also represent the emergence of the bottom of the policy. The bottom of the market is the last bottom. When the stock price continues to fall below the valuation bottom and policy bottom, the market begins to appear a positive line of heavy volume, and a series of flip signals appear, which means that the bottom of the market has also appeared.