HSI – Symmetrical triangle formation

HSI has been doing well recently relative to the SPX. A combination of the hope of China bottoming, a new premier in place & its bear trend finally exhausting.

For the global funds, H-shares are the only way they can invest into Chinese listcos  since China A-shares cannot be touched by them. Looking at SHCOMP’s performance, its clear locals there are a lot more bearish than global funds actively invested into H-shares.

Here’s a recent article link about the peculiar fund flows into H-shares. Quote from article:” Bank of America Merrill Lynch’s global survey of fund managers, covering 248 managers with $695 billion of assets under management, found confidence in China’s economy was at a three-year high.”

Its chart has been forming a big symmetrical triangle, and short term looks overbought & hitting the triangle trendline resistance. Im not confident that its a leading global indicator, therefore short term would look to short as it remains in the triangle & hasn’t formed a clear breakout of this pattern.


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