Shanghai: SSE Composite Index (.SSEC) stocks mixed after downbeat economic data

Shanghai: SSE Composite Index (.SSEC) stocks mixed after downbeat economic data

China stocks started the week on a mixed note after bleak economic data reinforced hopes Beijing will roll out more stimulus to underpin the economy and as investors pondered over the latest developments in the Sino-U.S. tariff war.

The CSI300 index fell 0.2%, to 3,965.40, by the end of the morning session on Monday, while the Shanghai Composite Index gained 0.1%, to 3,034.41.

The slowdown in the factory and consumer sectors deepened in August, with industrial production growing at the weakest pace in 17-1/2 years, a sign of increasing weakness in an economy lashed by trade headwinds and soft domestic demand.

Chinese Premier Li Keqiang said in an interview published ahead of the data on Monday that it would be “very difficult” for the economy to continue growing at 6% or more and that it faced “downward pressure”.

Analysts say they expect the latest data to lead to more cuts in key lending rates from Chinese authorities.

Investors also parsed through latest news and comments for signs of easing in the Sino-U.S. trade dispute.

U.S. President Donald Trump said on Thursday he preferred a comprehensive trade deal with China but did not rule out the possibility of an interim pact, even as he said an “easy” agreement would not be possible.

His remarks came after China and the United States made conciliatory gestures as the two sides prepare for new rounds of talks, including China’s purchases of U.S. soybeans.

Technical Indicators

Overall, the bias in prices is: Upwards.

Note: this chart shows extraordinary price action to the upside.

By the way, prices are vulnerable to a correction towards 2,939.47.

The projected upper bound is: 3,106.50.

The projected lower bound is: 2,955.79.

The projected closing price is: 3,031.15.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 75.6491. This is not an overbought or oversold reading. The last signal was a sell 0 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 70.36. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 2 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 90. This is not a topping or bottoming area. The last signal was a sell 1 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 20 period(s) ago.

Rex Takasugi – TD Profile

SSE COMPOSITE closed down -0.481 at 3,030.754. Volume was 17% above average (neutral) and Bollinger Bands were 2% wider than normal.

Open     High      Low     Close     Volume___
3,041.9223,042.9283,020.0503,030.75422,187,896,832
Technical Outlook 
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 2,991.39 2,904.59 2,862.84
Volatility: 10 17 24
Volume: 22,716,243,968 17,311,588,352 22,863,634,432

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

SSE COMPOSITE is currently 5.9% above its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume into .SSEC (mildly bullish). Our trend forecasting oscillators are currently bullish on .SSEC and have had this outlook for the last 15 periods. Our momentum oscillator is currently indicating that .SSEC is currently in an overbought condition.

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