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China Breaks 35-Year Support

ByChris Kimble
Published 12/30/2015, 03:48 PM
Updated 07/09/2023, 06:31 AM

The Hang Seng index has broken below support line (1) in the chart below. That support has been in play for the past 35 years. The Power of the Pattern is of the opinion that a key kiss of resistance could be in play and that what takes place from here could well impact markets globally.

The Hang Seng

The Hang Seng and the S&P 500 peaked together in 2007 and might have done the same again this year at (2). They also hit key lows together in 2009 as the Hang Seng was hitting support line (1).

Lately, the index has broken 35-year support and is now kissing the underside of the line at (3) above.

Until the Hang Seng gets above this resistance line and the S&P 500 takes out the 2,150 level, one might want to be under-weight the broader markets.

We believe that what takes place on the “underside” of resistance at (3) above could become very important for both the Hang Seng and the U.S. markets.

Latest comments

It is important noticing there is such a trendline. Nevertheless the penetration of the support may be not definitive as many times there is a faillure in the other wise valid breakout. We have to see if this retest holds
Well, you are the expert on the subject, yet I wonder how many other lines one can draw over a 35-year period and come up with a variety of alerts or lines in the sand, or resistance.. . Could you also add a section to each article depicting previous semi-alerts and how they panned out?. That can put things in perspective as to how reliable the analysis you share with us are of the Power of the Pattern are. You may well be doing us good, it's just interesting to know how often :)
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