Did the Hang Seng index just create a Double Top at the same price it peaked at in 2007?
This chart looks at the Hang Seng on a weekly basis over the past 15 years. As you can see, it peaked in 2007 and then proceeded to lose more than two-thirds of its value. After the large decline, it created a double bottom (higher lows) in 2009, where it started a new rising trend.
The 9-year rally off the 2009 lows saw it hit 2007 highs and then the underside of two rising channels earlier this year at (1) – where it may have double topped.
Since reversing at 2007's highs at (1), it is now breaking 3-year rising support at (2), which is below the 2015 highs.
Rising channel support off the 2009 lows comes into play around 22,000, about 20% below current prices. Keep a close eye on this key index as weakness in China could spill over into the states.
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