SSEC Shanghai Index Daily Chart Death Cross

The Shanghai is the latest index or stock printing a death cross chart pattern where the 50-day MA stabs down through the 200-day MA. The Shanghai is "shanghaied." The SPX (S&P 500), INDU (Dow Industrials), RUT (Russell 2000 Small Caps), HSI (Hang Seng Index), KOSPI (Korea) and AAPL (Apple) are all in death crosses. As typically happens when the death cross occurs, price bounces since it has been weak for weeks to create the negative cross.

The tight standard deviation bands (dark green) show the squeeze in August that resolved lower (green arrows). The positive divergence (green lines) bounced price about 11 days ago. The SSEC closes today at 3196 losing -1.5% (brown dot). The daily chart is agreeable to more upside. The lower band was violated so the middle band at 3406 and falling is targeted.

Looking at the SSEC weekly chart, however, the MACD line remains weak and bleak, so the ongoing near-term rally in the daily time frame should give way to weekly weakness say in late September or October and forward. Thus, in the near term, the Shanghai Index will likely float higher but then roll over again to move lower and test the recent lows. At that time the weekly chart may be agreeable to a more sustainable recovery rally but that can  be assessed later this month or in October. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.