Long
At the crossroad again
After a while, you see the same pattern emerging again and again.
This time, SHCOMP is facing a resistance once more like it had on Jul 19, Sept 19, Dec 19 and now. Dec 19 it did break out but not for long, only to come tumbling down on Jan 20. I think it may retrace to 2980 which will be a better price to enter. Still, the virus saga is causing the world stock market to halt its bullish move and pulling every industry down with the few exception of healthcare and defensive ones like Telco and Utilities.
So, cheap can get cheaper , I will monitor closely before entering. Longer term, I am still bullish on China.
This time, SHCOMP is facing a resistance once more like it had on Jul 19, Sept 19, Dec 19 and now. Dec 19 it did break out but not for long, only to come tumbling down on Jan 20. I think it may retrace to 2980 which will be a better price to enter. Still, the virus saga is causing the world stock market to halt its bullish move and pulling every industry down with the few exception of healthcare and defensive ones like Telco and Utilities.
So, cheap can get cheaper , I will monitor closely before entering. Longer term, I am still bullish on China.
Note
chinadaily.com.cn/a/202002/25/WS5e5430cda310128217279ef6.htmlAlthough it is still not confirmed the virus comes from the seafood sold in the market, I am very happy as I am an animal lover and feel sad that humans have to eat all these fury animals.
Note
a bullish engulfing candle. Which piece of news would drive SHCOMP higher today ?reuters.com/article/us-usa-stocks/wall-street-bounces-back-as-stimulus-hopes-soothe-recession-fears-idUSKBN20X1AJ
OR
scmp.com/economy/china-economy/article/3074495/coronavirus-china-trumpets-message-stability-amid-world
Actually, I don't know. I let the chart guide me to do what I need to. It's a simple rule ,we know but being humans filled with mood swings, we tend not to follow sometimes and ignore the rules. That is when we pay the price. Follow the rules.
Note
If you study the chart closely, you can find there are at least 4 attempts that it tries to break out from the bearish trend without much success.There have been many articles that talks about China stock market being much undervalued compared to US, which is true. But undervalued can stays for a long time. Now, we are seeing the price at 2818 but it can goes below that if the 3rd wave of virus is not well contained. Already, some analysts are criticising China for opening its economy too soon too fast and risk another backlash.
So, if you are buying this index, be prepared to ride through with it on the long haul.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.