Is spring season rally about to kick off again? This discussion happens every year around this time. Based on more than a decade of experience, spring rallies have indeed frequently lived up to expectations—if you missed it, you should really think about why.
Why is spring so prone to rallies? Simply put, it comes down to three things: liquidity, expectations, and sentiment.
Liquidity is paramount. Liquidity conditions are usually decent early in the year, with market activity picking up after the Chinese New Year. The "good start" rally in early year gives everyone confidence, and once capital enters the market, short-term gains naturally follow. No rally can go far without capital accumulation—this is the most fundamental logic.
Next is expectations. Spring is peak season for policy discussions, especially when important conferences are densely scheduled. Investors have a long-standing habit—betting ahead of time. The market particularly buys into "narrative" at this time, and as long as the story is told well, once optimistic sentiment kicks in, the rally naturally materializes.
Add to this the "data vacuum." Fewer corporate earnings reports come out early in the year, and economic data isn't as dense. The market simply doesn't have to worry about actual data ruining the narrative. In this environment, imagination gets infinitely expanded, and price performance becomes more "willful."
From a timeframe perspective, spring rallies typically last 2 to 3 months. They can start as early as December, but January has the highest probability. This year market sentiment is indeed quite active, and 2025's rally itself has been quite strong. Even with occasional pullbacks, the overall mood remains optimistic. Major institutions and retail investors are all preparing for this spring rally, waiting for another round of "celebration."
Is spring season rally about to kick off again? This discussion happens every year around this time. Based on more than a decade of experience, spring rallies have indeed frequently lived up to expectations—if you missed it, you should really think about why.
Why is spring so prone to rallies? Simply put, it comes down to three things: liquidity, expectations, and sentiment.
Liquidity is paramount. Liquidity conditions are usually decent early in the year, with market activity picking up after the Chinese New Year. The "good start" rally in early year gives everyone confidence, and once capital enters the market, short-term gains naturally follow. No rally can go far without capital accumulation—this is the most fundamental logic.
Next is expectations. Spring is peak season for policy discussions, especially when important conferences are densely scheduled. Investors have a long-standing habit—betting ahead of time. The market particularly buys into "narrative" at this time, and as long as the story is told well, once optimistic sentiment kicks in, the rally naturally materializes.
Add to this the "data vacuum." Fewer corporate earnings reports come out early in the year, and economic data isn't as dense. The market simply doesn't have to worry about actual data ruining the narrative. In this environment, imagination gets infinitely expanded, and price performance becomes more "willful."
From a timeframe perspective, spring rallies typically last 2 to 3 months. They can start as early as December, but January has the highest probability. This year market sentiment is indeed quite active, and 2025's rally itself has been quite strong. Even with occasional pullbacks, the overall mood remains optimistic. Major institutions and retail investors are all preparing for this spring rally, waiting for another round of "celebration."