Shanghai: SSE Composite Index (.SSEC) 90-day trade war truce
Stocks listed in mainland China and Hong Kong rose on Monday after Chinese president Xi Jinping and his US counterpart, Donald Trump, reached an agreement over the weekend to de-escalate the US-China trade war.
On the mainland, the benchmark Shanghai Composite Index rose by 2.6 per cent to 2,654.8, recording its biggest daily gain in a month, following a 90-day trade truce agreed by Xi and Trump at the G20 summit in Argentina that will allow time for further talks.
The benchmark indices in Shanghai and Hong Kong have dropped by 21 per cent and 11 per cent, respectively, since the beginning of the year, weighed down by the escalating trade war and China’s slowing economy.
“We see the ongoing dialogue between the two sides as an important catalyst for Asian markets to recover lost ground this year,” said Tai Hui, strategist at JPMorgan Asset Management in Hong Kong.
The gains on equities were broad-based. Almost all of the 3,600-plus stocks on the Shanghai and Shenzhen exchanges rose, with just 42 falling.
Overall, the bias in prices is: Downwards.
By the way, prices are vulnerable to a correction towards 2,698.68.
The projected upper bound is: 2,788.31.
The projected lower bound is: 2,520.21.
The projected closing price is: 2,654.26.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 26 white candles and 24 black candles for a net of 2 white candles.
A rising window occurred (where the top of the previous shadow is below the bottom of the current shadow). This usually implies a continuation of a bullish trend.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 54.7037. This is not an overbought or oversold reading. The last signal was a buy 2 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 53.91. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 31 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 43. This is not a topping or bottoming area. The last signal was a buy 3 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 6 period(s) ago.
Rex Takasugi – TD Profile
SSE COMPOSITE closed up 66.611 at 2,654.798. Volume was 42% above average (neutral) and Bollinger Bands were 29% narrower than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 2,608.49 2,643.65 2,917.02
Volatility: 28 32 25
Volume: 16,471,845,888 16,251,063,296 14,723,123,200
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.
SSE COMPOSITE gapped up today (bullish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
SSE COMPOSITE is currently 9.0% below 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 volume flowing into and out of .SSEC at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on .SSEC and have had this outlook for the last 12 periods.