Shanghai: SSE Composite Index (.SSEC) rises bolstered by hopes Beijing will pursue more stimulus this year to underpin the cooling economy
China’s major stock indexes climbed on Wednesday, hovering near a nine-month high, bolstered by hopes Beijing will pursue more stimulus this year to underpin the cooling economy, even as investors watched for developments in the Sino-U.S. trade talks.
The CSI300 index rose 0.2 percent to 3,825.12 points at the end of the morning session, while the Shanghai Composite Index gained 0.9 percent to 3,082.87 points.
A private survey showed on Tuesday China’s services sector expanded at the slowest pace in four months in February, underlining growing strains on the economy and a challenging outlook for businesses this year.
On the trade front, U.S. Secretary of State Mike Pompeo said on Monday he thought the United States and China were “on the cusp” of a deal to end their trade war. Pompeo added on Tuesday that “Things are in a good place, but it’s got to be right.”
The largest percentage gainers in the main Shanghai Composite index were Shanghai Guangdian Electric Group Co Ltd, up 10.12 percent, followed by Wenfeng Great World Chain Development Corp, gaining 10.12 percent and Sichuan Changhong Electric Co Ltd, up by 10.06 percent.
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 2,785.40.
The projected upper bound is: 3,208.82.
The projected lower bound is: 3,012.07.
The projected closing price is: 3,110.44.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 31 white candles and 19 black candles for a net of 12 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 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 80.0234. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 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 84.97. 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 sell 9 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 111.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 21 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 37 period(s) ago.
Rex Takasugi – TD Profile
SSE COMPOSITE closed up 46.149 at 3,100.396. Volume was 173% above average (trending) and Bollinger Bands were 179% 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: 2,952.98 2,656.79 2,751.24
Volatility: 32 23 25
Volume: 43,424,825,344 21,385,590,784 15,843,244,032
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 12.7% above its 200-period moving average and is in an upward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect very strong flows of volume into .SSEC (bullish). Our trend forecasting oscillators are currently bullish on .SSEC and have had this outlook for the last 31 periods. Our momentum oscillator is currently indicating that .SSEC is currently in an overbought condition.
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