Shanghai: SSE Composite Index (.SSEC) investors sentiment remained bullish

Shanghai: SSE Composite Index (.SSEC) investors sentiment remained bullish

Shanghai: SSE Composite Index (.SSEC) investors sentiment remained bullish

China’s stock indices ended higher for a fourth trading day on Tuesday as investors sentiment remained bullish.

The benchmark Shanghai Composite Index closed up 0.68 percent at 2,671.89 points. The Shenzhen Component Index ended 1.15 percent higher at 8,010.07 points.

MSCI, one of the world’s largest index providers, announced Tuesday that it would include 12 more Chinese companies to its MSCI indices, effective on Feb. 28. Five A shares, including Foxconn Industrial Internet Co., and Aluminum Corporation of China, were added to the indices.

Boosted by the news, Foxconn, Apple’s contract manufacturer, jumped 3.21 percent to close at 12.54 yuan per share.

The pharmaceutical sector posted strong performance. Kangmei Pharmaceutical Co. surged by the daily limit of 10 percent to end at 7.36 yuan.

Coal shares were also among the winners, with Yanzhou Coal Mining Co., a major coal producer, up 1.85 percent at 9.37 yuan.

The ChiNext Index, China’s NASDAQ-style board of growth enterprises, gained 1.23 percent to close at 1,332.27 points.

Overall, the bias in prices is: Upwards.

The projected upper bound is: 2,743.53.

The projected lower bound is: 2,603.95.

The projected closing price is: 2,673.74.

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 28 white candles and 22 black candles for a net of 6 white candles.

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 94.4379. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 10 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 68.18. 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 75 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 225.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 5 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 21 period(s) ago.

Rex Takasugi – TD Profile

SSE COMPOSITE closed up 17.998 at 2,671.894. Volume was 19% above average (neutral) and Bollinger Bands were 31% narrower than normal.

Open High Low Close Volume___
2,654.0352,674.4782,648.8302,671.89418,410,117,120

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

Moving Averages: 10-period 50-period 200-period
Close: 2,606.98 2,572.23 2,770.24
Volatility: 12 17 24
Volume: 14,932,191,232 14,264,363,008 14,077,648,896

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 3.6% below its 200-period moving average and is in an upward trend. Volatility is low 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.

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