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China Bounce Or Catastrophic Drop Coming?

Published 05/12/2017, 12:24 AM
Updated 07/09/2023, 06:31 AM
AORD
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SSEC
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Further to my post of May 7, the following daily comparison and ratio charts of China's Shanghai Index (SSEC) and Australia's Composite Index (AORD) show that SSEC now sits at long-term major support (in both instances), once again, and is vulnerable to further weakness in comparison with AORD.

We'll see if the Shanghai Index can muster a bounce here and gain any kind of sustainable strength and momentum to support an eventual breakout to higher prices in the Australian Index, or whether a plunge here produces a follow-on drop in AORD.

Failure at current levels could produce a catastrophic and swift drop for China down to the lows produced in 2014.


Daily Comparison chart of SSEC and AORD

Daily Ratio chart of SSEC and AORD

Latest comments

the looming catastrophic episode is indicated by the notion that everything is predicated upon the current positive uptick continuing for some time. not! expect some panic to seep into the markets as one by one the major players stop drinking the kool-aid. the fed will not keep raising rates and the US dollar, after one last spike, is set to tumble. when the trouble starts .... get ready to buy some yen! oh yeah , usd/jpy will be below 100 by year end.
when chinese data is involved, i expect fake product.
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