ftsexinhua china a50 daily outlook for thurs 05 feb potential push up towards trendline resistance a
<p>What happened yesterday The FTSE/Xinhua China A50 has challenged the daily pivotal support at 10540 but it managed to stage a recovery in the late […]</p>
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What happened yesterday
The FTSE/Xinhua China A50 has challenged the daily pivotal support at 10540 but it managed to stage a recovery in the late evening session towards our first target at 10900/10960 reinforced by the Chinese central bank, PBOC’s decision to cut reserve ratio requirements for banks. Please click on this link for more details on our previous daily outlook.
Key elements
- In this morning session, price action of the Index has retraced back towards the pull-back support (in line green) at 10540/10480.
- The 10540/10480 also corresponds with the trendline support (in dark green) in place since 19 January 2015 low.
- The trendline resistance joining the highs since 05 January 2015 remains at 11200/11300.
- The 11200/11300 resistance also corresponds with the 0.764 Fibonacci projection from 19 January 2015 low to 02 February 2015 low.
- The hourly Stochastic oscillator has dipped into the oversold region.
Key levels
Pivot (key support): 10540/10480
Resistance: 11200/11300
Next support: 10270 & 10030
Conclusion
As long as the daily pivotal support at 10540/10480 holds, the Index is likely to see another round of upside movement to target the weekly pivotal resistance at 11200/11300.
However, a break below 10480 may invalidate the bullish tone to resume its intermediate corrective downside movement towards 10270 before 10030.
Disclaimer
The information contained in this material is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs. All queries regarding the contents of this material are to be directed to City Index Asia Pte Ltd.
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