Shanghai: SSE Composite Index (.SSEC) China and the U.S. are trying to strike a deal before March 2

Shanghai: SSE Composite Index (.SSEC) China and the U.S. are trying to strike a deal before March 2

Shanghai: SSE Composite Index (.SSEC) China and the U.S. are trying to strike a deal before March 2

High-level trade talks between the U.S. and China are underway in Beijing. Stocks in Asia were mixed on Thursday as investors looked for progress in the months-long tariff dispute.

There were reports that U.S. President Donald Trump may be considering whether to extend the deadline for a trade deal with China.

The mainland Chinese markets closed mostly higher. The Shenzhen component rose 0.597 percent to close at around 8,219.96 while the Shenzhen composite advanced 0.659 percent to finish its trading day at approximately 1,398.84. Meanwhile, the Shanghai composite closed slightly lower at about 2,719.70

Hong Kong’s Hang Seng index fell more than 0.3 percent, as of its final hour of trading.

China trade numbers

The moves came on the back of Chinese trade data for January coming in stronger than expected.

Dollar-denominated exports for the month rose 9.1 percent from a year ago, according to Chinese customs data. January exports in the world’s second-largest economy were expected to have contracted 3.2 percent from a year earlier, according to economists in a Reuters poll, compared with December’s 4.4 percent decline.

January dollar-denominated imports fell 1.5 percent on-year, which was far better than expected. Imports in December fell 7.6 percent from a year ago.

“The variable timing of the Lunar New Year likely helped lift export growth, rather than reflecting any significant change in global demand. Looking at the regional picture, growth in South Korean exports fell over the same period, while Taiwan’s exports likely contracted as well based on its January PMI readings,” Nick Marro, analyst at The Economist Intelligence Unit, said in a note following the release of the Chinese trade data.

“This suggests that demand headwinds, both in the global consumer electronics industry and more generally, are continuing to bite into growth — meaning that downwards pressure on growth in Chinese shipments will likely return sooner rather than later, regardless of what happens with the trade negotiations this week,” Marro said.

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 2,619.28.

The projected upper bound is: 2,795.12.

The projected lower bound is: 2,650.09.

The projected closing price is: 2,722.60.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 8 white candles and 2 black candles for a net of 6 white candles. During the past 50 bars, there have been 30 white candles and 20 black candles for a net of 10 white candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

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 95.3824. 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 73.33. 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 buy 77 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 184.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 7 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 23 period(s) ago.

Rex Takasugi – TD Profile

SSE COMPOSITE closed down -1.368 at 2,719.700. Volume was 26% above average (neutral) and Bollinger Bands were 2% narrower than normal.

Open High Low Close Volume___
2,715.5362,729.4552,707.4872,719.70019,703,734,272

Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bearish

Moving Averages: 10-period 50-period 200-period
Close: 2,633.79 2,578.03 2,766.65
Volatility: 15 18 24
Volume: 16,485,816,320 14,630,079,488 14,144,807,936

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 1.7% 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 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 17 periods. Our momentum oscillator is currently indicating that .SSEC is currently in an overbought condition.

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