Shanghai: SSE Composite Index (.SSEC) higher following the tariffs reprieve from Washington
China stocks closed higher on Wednesday, following the tariffs reprieve from Washington, but gave up much of early gains as bleak data rekindled worries over the country’s’ economic health.
The blue-chip CSI300 index ended 0.5% higher to 3,682.40, while the Shanghai Composite Index rose 0.4% to 2,808.91.
Meanwhile, China reported a raft of unexpectedly weak July data on Wednesday, including a slump in industrial output to more than 17-year lows, pointing to further slowing in the economy as the U.S. trade war takes a heavier toll on businesses and consumers.
Activity in China has continued to cool despite a flurry of growth measures over the past year, raising questions over whether more forceful stimulus may be needed, even at the risk of increasing its debt.
“China’s economy needs more stimulus because the headwinds are pretty strong and today’s data is much weaker than consensus,” said Larry Hu, head of Greater China economics at Macquarie Group in Hong Kong.
Consumer stocks provided some momentum, led by market bellwether Moutai scaling a new high, on hopes Beijing would further boost domestic consumption to shore up growth.
About 14.40 billion shares were traded on the Shanghai exchange, roughly 92% of the market’s 30-day moving average of 15.66 billion shares a day. The volume in the previous trading session was 13.09 billion.
Overall, the bias in prices is: Downwards.
By the way, prices are vulnerable to a correction towards 2,901.20.
The projected upper bound is: 2,894.04.
The projected lower bound is: 2,721.65.
The projected closing price is: 2,807.85.
A black body occurred (because prices closed lower 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 24 white candles and 26 black candles for a net of 2 black 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. There have been 4 rising windows in the last 50 candles–this makes the current rising window even more bullish.
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 79.2766. This is not an overbought or oversold reading. The last signal was a buy 4 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 39.36. 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 4 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 -38. 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 8 period(s) ago.
Rex Takasugi – TD Profile
SSE COMPOSITE closed up 11.655 at 2,808.915. Volume was 35% below average (neutral) and Bollinger Bands were 1% narrower than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 2,813.48 2,914.63 2,830.08
Volatility: 19 19 25
Volume: 15,878,126,592 17,753,196,544 22,750,715,904
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 0.7% below its 200-period moving average and is in an downward trend. Volatility is Our volume indicators reflect volume flowing into and out of .SSEC at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on .SSEC and have had this outlook for the last 21 periods.