ftsexinhua china a50 weekly outlook for 02 feb to 06 feb further potential downside below 11300 1421
<p>What happened last week The FTSE/Xinhua China A50 has broken below the lower limit of the neutrality range at 11000 and drifted lower. Please click […]</p>
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What happened last week
The FTSE/Xinhua China A50 has broken below the lower limit of the neutrality range at 11000 and drifted lower. Please click on this link for more details on our previous weekly outlook.
Key elements
- The 20-day Moving Average is acting as a resistance at around 10960 (see daily chart).
- The intermediate term RSI oscillator is still below its resistances and still “home” for further downside before reaching the trendline support (see daily chart).
- The 9350/9200 support confluences closely with a Fibonacci cluster and the 100-day Moving Average (see daily & 4 hour charts).
- The short-term Stochastic oscillator has just exited from its oversold region which suggests a potential short-term rebound is round the corner (see 4 hour char).
Key levels (1 to 3 weeks)
Intermediate resistance: 10960
Pivot (key resistance): 11300
Support: 10030 & 9350/9200
Next resistance: 12040/12065
Conclusion
A break below 11000 seen last week has validated further downside potential for the Index. Right now, a potential short-term rebound (observation from the 4 –hour Stochastic) is expected towards the intermediate resistance at 10960 with a maximum limit set at the pivotal resistance of 11300 before another potential downside movement materialises to test the 10030 support.
However, a break above 11300 is likely to see a push up to retest the January 2015 swing high at 12040/12065.
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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