Huaxi Securities' Wei Tao: This round of adjustment is a benign technical repair, and the conditions for a rebound are gradually maturing.

Wei Tao, Deputy General Manager and Director of the Research Institute of Huaxi Securities, stated on July 22 that from the perspective of market operation rules, the current round of correction is essentially a benign technical adjustment to the previous rapid rise. Since April 2026, the technology sector has continued to strengthen, with some sectors seeing rapid valuation increases, leading to an inherent demand in the market for valuation regression and chip exchange. After a recent series of adjustments, the accumulated profits from earlier trades have been partially digested, and some of the short-term irrational selling pressure has been released. Wei Tao stated that the conditions for the current market rebound are gradually maturing. From a valuation perspective, major broad-based indices have fallen to relatively low levels for the year, significantly increasing the safety margin; from a fund perspective, market leverage risks have been effectively cleared, margin trading balances have significantly decreased, and mainstream broad-based ETFs continue to attract funds at low levels, indicating an increasing acceptance of the current levels by medium and long-term funds. With the decrease in crowding and the balance of trading structures, there is now space for a rebound and recovery on a technical level.