ln early December we pointed out that China's equity markets were beginning to show signs of stability. After rallying a little further after that post, however, China's market pulled back once again, but it never broke below its prior lows from November. Now, China has staged another short-term rally, and it just broke out of its multi-month trading range today. From its low in November, China's Shanghai Composite has rallied 23.5%, and its technicals have turned positive once again. But as shown in the top chart below, the index still has a long way to go before it puts a dent in the declines seen in '07 and '08.
Really enjoy your site BUT with reference to the article on CHINA BREAKOUT----what charts are you looking at? Neither the daily charts of FXI nor PGJ show the action you reference in the blog. The title got my attention but I don't see the charts showing such a "breakout." Thanks.
Posted by: Las Olas One | February 05, 2009 at 10:42 AM
Las Olas One,
As referenced in both the text and chart title, the index used is the Shanghai Composite, which is widely regarded as China's main equity index. The charts you are referring to are of ETFs that cover Chinese companies with shares traded outside of China.
Posted by: Justin | February 05, 2009 at 11:14 AM