China Shanghai Stocks Index, FXI ETF Extends Rally
Stock-Markets / Chinese Stock Market Jul 26, 2010 - 12:26 PM GMTThe Shanghai Composite Index closed higher for the seventh consecutive session, and more importantly from a technical perspective closed above its (now flat) 50 DMA for the first time since mid-April. The strength extends the July rally, which could be morphing into a technically significant key monthly upside reversal.
If the SH Comp hurdles and remains above the June high at 2598.33 at Friday's close, then the benchmark China equity index will register a potentially very powerful positive technical signal that should be associated with a near and possibly intermediate-term turn in trend. ETF traders may want to watch the iShares FTSE/Xinhua China 25 Index (FXI). Such a signal could have meaningful positive implications for global growth, corporate profits, and equity prices.
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By Mike Paulenoff
Mike Paulenoff is author of MPTrader.com (www.mptrader.com), a real-time diary of his technical analysis and trading alerts on ETFs covering metals, energy, equity indices, currencies, Treasuries, and specific industries and international regions.
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