What does the inflow of capital northward mean?
The inflow of funds from the north means that funds are buying the stock and are bullish. In the stock market, the inflow of northward funds is mainly divided into two parts: the first is the inflow at the level of individual stocks. Their short-term inflow is bullish on this stock, thinking that it will have a great increase in the future, while the long-term inflow is because this stock is currently undervalued and there is a chance of a big increase in the later period. The second is the inflow at the index level, which is the summary of all the inflows in the market, so it will affect the market trend for a period of time.
Northbound fund is also called smart fund in the stock market, because its operation in recent years can accurately predict the bottom and top of the market, so many investors in the market also believe in the flow of such funds and operate according to the trend of such funds. However, it should be noted that the movement of funds northward in one day has limited impact on the whole market. That is to say, a large number of inflows on a certain day, so the impact on the whole market is limited, so only a continuous inflow for more than a week can have a positive impact on the whole market.
Generally speaking, we can directly ignore the short-term inflow of funds going northward, but if it lasts for a week or two, then we can wait and see more appropriately, because it means that the market is about to be bullish.