Shanghai: SSE Composite Index (.SSEC) trade worries intensify

Shanghai: SSE Composite Index (.SSEC) trade worries intensify

Shanghai: SSE Composite Index (.SSEC) trade worries intensify

China’s major stock indexes fell on Wednesday, as trade worries intensified following a report that the United States could blacklist another Chinese tech firm after banning Huawei Technologies last week.

The blue-chip CSI300 index fell 0.5%, to 3,649.38, while the Shanghai Composite Index also ended down 0.5% at 2,891.70.

The U.S. administration is considering Huawei-like sanctions on Chinese video surveillance firm Hikvision, media reports show, deepening worries that trade friction between the world’s top two economies could be further inflamed.

That came after the U.S. Commerce Department blocked Huawei Technologies Co Ltd from buying U.S. goods last week.

Beijing is ready to resume trade talks with Washington, China’s ambassador to the United States Cui Tiankai said, as a top U.S. business lobby in China said nearly half its members are seeing non-tariff barrier retaliation in China due to the trade war.

Foreign investors continued to retreat via the Stock Connect linking Hong Kong and the mainland, selling more than 4 billion yuan ($578.87 million) worth of mainland shares on Wednesday. They have so far sold more than 40 billion yuan worth of A-shares in May.

Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.09%, while Japan’s Nikkei index closed up 0.05%.

At 07:14 GMT, the yuan was quoted at 6.9105 per U.S. dollar, 0.11% weaker than the previous close of 6.9028.

The largest percentage gainers in the main Shanghai Composite index were Ningbo Bird Co Ltd, up 10.05%, followed by Shanghai Wondertek Software Co Ltd, which gained 10.02% and Hunan Copote Science Technology Co Ltd that rose 10.01%.

The largest percentage losers in the Shanghai index were Zhejiang Dibay Electric Co Ltd, down 9.98%, followed by Yuancheng Environment Co Ltd that shed 6.92% and Guangxi Wuzhou Communications Co Ltd which lost 6.87%.

So far this year, the Shanghai stock index is up 16% and the CSI300 has risen 21.2%, while China’s H-share index listed in Hong Kong is up 4.8%. Shanghai stocks have declined 6.06% this month.

As of 07:15 GMT, China’s A-shares were trading at a premium of 24.27% over the Hong Kong-listed H-shares.

Overall, the bias in prices is: Downwards.

Note: this chart shows extraordinary price action to the downside.

The projected upper bound is: 3,040.42.

The projected lower bound is: 2,734.40.

The projected closing price is: 2,887.41.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 25 white candles and 25 black candles.

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 43.0769. This is not an overbought or oversold reading. The last signal was a sell 3 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 39.72. 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 8 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 -44. This is not a topping or bottoming area. The last signal was a buy 8 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 sell 25 period(s) ago.

Rex Takasugi – TD Profile

SSE COMPOSITE closed down -14.264 at 2,891.705. Volume was 33% below average (neutral) and Bollinger Bands were 46% wider than normal.

Open High Low Close Volume___
2,905.5242,912.3952,879.6442,891.70520,002,691,072

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

Moving Averages: 10-period 50-period 200-period
Close: 2,902.25 3,071.49 2,776.42
Volatility: 31 32 28
Volume: 22,688,165,888 33,650,515,968 21,193,994,240

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 4.2% above its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect very strong flows of volume out of .SSEC (bearish). Our trend forecasting oscillators are currently bearish on .SSEC and have had this outlook for the last 16 periods.


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