Shanghai: SSE Composite Index (.SSEC) blue-chip stocks dropped after a senior White House adviser played down expectations of fresh trade talks
China’s blue-chip stocks dropped on Wednesday, after a senior White House adviser played down expectations of fresh trade talks, while Beijing’s latest pledge to further liberalise financial markets seemed to generate limited enthusiasm.
The CSI300 index was down 0.3% at 3,946.58 points at the end of the morning session, while the Shanghai Composite Index was unchanged at 3,021.10 points.
Mainland investors remained cautious amid lingering uncertainties over potential trade negotiations between China and the United States.
A senior White House adviser tamped down expectations on Tuesday for the next rounds of U.S.-China trade talks, urging investors, businesses and the public to be patient about resolving the two-year trade dispute between the world’s two largest economies.
Meanwhile, Beijing’s latest effort to further open up its financial markets seemed to provide limited support for the market, as the move appeared largely symbolic.
China’s foreign exchange regulator said on Tuesday that it had decided to scrap quota restrictions on two major inbound investment schemes, as a weakening yuan and rising outflows prompt Beijing to seek to attract more foreign capital.
“At the end of the day, whether foreign investors will invest more in China or not depends on the current and future fundamental outlook of the underlying economy, trend of corporate earnings, attractiveness of their yield and yield spreads, and the perceived strength or weakness of the (yuan),” said Khiem Do, head of Greater China investments at Barings.
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 2,927.21.
The projected upper bound is: 3,083.60.
The projected lower bound is: 2,933.76.
The projected closing price is: 3,008.68.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 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 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 89.1098. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 12 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 67.69. This is not a topping or bottoming area. However, the RSI just crossed below 70 from a topping formation. This is a bearish sign. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 0 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 101.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 10 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 buy 18 period(s) ago.
Rex Takasugi – TD Profile
SSE COMPOSITE closed down -12.391 at 3,008.812. Volume was 21% above average (neutral) and Bollinger Bands were 2% wider than normal.
Open High Low Close Volume___
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 2,962.90 2,903.67 2,859.02
Volatility: 11 16 24
Volume: 22,253,498,368 17,176,232,960 22,853,455,872
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 is currently 5.2% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. 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 13 periods.
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