Saturday, December 27, 2014
China stock market has broken out. Short term overbought.
The Chinese market has broken out of a descending triangle going all the way back to mid 2009. China is now in the process of cutting rates and I suspect that after five years of under performance we will see some catching up in this market. The Chinese market has gone up too fast too soon recently so I expect a pullback in the near future and than an advance to new highs. People are way to pessimistic and everyone just knows that China is getting ready to implode. I think too many people are on that side of the canoe and I am willing to take the other side of that trade. The Chinese market is my "stock of the year" pick and I am playing it via (FXI).