Shanghai Composite (SSEC.NDX)

Short term

Shanghai Composite is within an approximate horizontal trend channel in the short term, which indicates further development in the same direction. The index has support at points 3170 and resistance at points 3470. Volume tops and volume bottoms correspond well with tops and bottoms in the price. Volume balance is also positive, wich strengthens the index and indicates increased chance of a break up. Trading volume has increased substantially lately. This shows there is an increased interest for the index, possibly because of fundamental news. The RSI curve shows a falling trend, which is an early signal of a possible trend reversal downwards for the price as well. The index is overall assessed as technically slightly positive for the short term.

Recommendation one to six weeks: Weak Positive

Medium term

Shanghai Composite is within an approximate horizontal trend channel in the medium long term, which indicates further development in the same direction. The index gave a negative signal from the double top formation by the break down through the support at 3260. Further fall to 3066 or lower is signaled. The index has support at points 3170 and resistance at points 3470. Positive volume balance shows that volume is higher on days with rising prices than days with falling prices. This indicates increasing optimism among investors. The index is overall assessed as technically neutral for the medium long term.

Recommendation one to six months: Hold

Long term

Shanghai Composite has broken the ceiling of the falling trend in the long term, which indicates a slower initial falling rate. The index has given a positive signal from the rectangle formation by a break up through the resistance at 3128. Further rise to 3675 or more is signaled. The index is approaching support at 3170 points, which may give a positive reaction. However, a break downwards through 3170 points will be a negative signal. Positive volume balance strengthens the index in the short term. The RSI curve shows a rising trend, which could be an early signal of the start of a rising trend for the price as well. The index is overall assessed as technically positive for the long term.

Recommendation one to six quarters: Positive