Reuters SHANGHAI LONG TERM Technical Analysis (By Phil Smith)

Longer term (weekly chart). More broad sideways movement but the MACD is turning more bearish and the Parabolic-SAR on the weekly has now turned bearish as well.

The overhead resistance at the 38.2 percent Fibonacci Retracement level was good for over two months and pretty much marked the high in Q3. A fairly standard 38.2 pct retracement of the entire downturn.

The MACD lines have been flat through to February but are now staring to point down more aggressively.

The correction to the 110 percent rally from the October low was fast and importantly volume tailed off as a result. Volume has now dropped right off again so any upside for this weekly chart will be extremely limited. Longer term this market looks like it is going sideways as I’ve been saying for months now but the US stock charts are turning bearish and that could impact on Shanghai.

As with all the world’s stock markets, the rally since the major turn from the big bear market has been significant and consolidation is the watchword not further gains.

In terms of Relative Performance the Shanghai market is still outperforming the world markets as per the bottom chart. This study is zeroed at the start of 2009.

See the glossary link above for an explanation of the studies used above.

Reuters Market Technicals

By Phil Smith mailto:technicals@reutersindia.net

For more information on Reuters services please click here

By accessing this site you agree to the following terms: (a) the information provided on this site is the proprietary information of the Thomson Reuters Group or its third party providers; (b) the information is intended as a general information only and is neither professional advice of whatever nature (whether securities, investment, taxation, legal or other) nor a substitute for obtaining professional advice; (c) this information is not an offer or solicitation for the purchase or sale of any securities or financial instruments; (d) Thomson Reuters Group expressly disclaims all warranties, expressed or implied, as to the accuracy, completeness or timeliness of any information provided, or as to the fitness of the information for any purpose or as to any action taken relying on the information; (e) no part of such materials or information may be copied, transmitted, republished, redistributed or disseminated without the prior written consent of Thomson Reuters; and (f) Thomson Reuters and the Kinesis logo are registered trademarks or trademarks of the Thomson Reuters Group. The term “Thomson Reuters Group” means [full legal entity name of Thomson Reuters (“Thomson Reuters”)] and its affiliates. The term “affiliate” means any entity that from time to time, directly or indirectly controls, is controlled by, or is under common control with Thomson Reuters, or that is a successor (including, without limitation, by change of name, dissolution, merger, consolidation, reorganization, sale or other disposition) to any such entity or its business and assets, (ii) Thomson Reuters Corporation, Thomson Reuters PLC or any entity or entities that from time to time is / are the parent company or parent companies of any of the Thomson Reuters group of companies (each a Thomson Reuters Parent Company) or (iii) the respective direct or indirect subsidiaries of any Thomson Reuters Parent Company. An entity will be deemed to control another entity if it has the power to direct or cause the direction of the management or policies of such entity, whether through the ownership of voting securities, by contract or otherwise.