Long
Bullish China A-Shares
I am bullish Chinese A-shares. Technical analysis needs to adapt to the Underlying market. Whereas Developed Markets are volatile in bear market phases and near their lows, and less volatile near record highs and in strong bull markets, China functions differently: China A-shares very often see explosive rallies, and similarly dramatic declines. The market then tends to bottom out in a boring trading range. In short: China is volatile near the highs, and less volatile near the lows.
What we are currently observing is a clean base completion, visible on all daily, weekly and monthly charts. The market also jumped above the 200day moving average for the first time in a year. Monthly momentum indicators also bottomed out and start rising. A lot points to a new explosive rally. The giant awakens: the Shanghai Composite was so boring over the past half year, I completely ignored it. That’s good – you want to invest in what people nearly forgot. Time to buy China again!
What we are currently observing is a clean base completion, visible on all daily, weekly and monthly charts. The market also jumped above the 200day moving average for the first time in a year. Monthly momentum indicators also bottomed out and start rising. A lot points to a new explosive rally. The giant awakens: the Shanghai Composite was so boring over the past half year, I completely ignored it. That’s good – you want to invest in what people nearly forgot. Time to buy China again!
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