The Shanghai Composite Index broke out of its descending trend channel, indicating that a bottom is forming. 63-Day Twiggs Momentum, however, remains a long way below zero, indicating weakness. Look for a retracement to test support at 2150.
Hong Kong’s Hang Seng Index displays a strong up-trend since breaking resistance at 20,000. Expect retracement to test the new support level, but buying pressure, best illustrated by the strong rise on (medium-term) 21-day Twiggs Money Flow, is likely to prevail.
* Target calculation: 20000 + ( 20000 – 18000 ) = 22000