China - Market Direction 01 (May 12 - Jul 15)

[winston]

Beware Shanghai

How much further will Shanghai A shares go up? Let's take a look at the Shanghai Composite Index.

Since 2009, the mainland benchmark has followed a downward trend. In August 2009, it hit a high at 3,478.

From the start of 2012, prospects improved. There was a government- manipulated bottom. Since then, the index has recovered quickly when it has slipped below 2,000.

It hit a 2,478 high in March 2012. Then it fell to 1,949 in December 2012. It rose to a high of 2,444 in February 2013 and fell to a trough 1,849 in June 2013. In September and December, it formed a double top at 2,270 and 2,260.

It weakened to 1,984 in January. It was at 1,991 in May. Again, it rebounded to above 2,000 very quickly. Now the benchmark stands around 2,220.

If you agree with my assessment that China's economy has not improved much, then the Shanghai index cannot rise above 2,444  the high of February 2013. I would set 2,400 as a target for the current rally.

Raise as much cash as possible at that level.


Source: Dr Check, The Standard HK

[winston]

It’s Not Too Late to Ride the Rally in China Stocks

Additional easing, insulation from geopolitical instability and bargain prices should keep fueling China stocks through yearend

By Dan Burrows

Source: InvestorPlace

http://investorplace.com/2014/08/china- ... -vieqM0OZQ

[winston]

We stay positive given a stabilizing economy and more concrete positive reforms ahead.

We expect EPS growth at 8% to play a more important role driving the index, with a further low single-digit valuation rerating given reform initiatives.

For sector allocation, we adopt an alpha strategy given the low beta of GDP quantity changes, and prefer sectors with a high combined scorecard factoring in cyclical/ reform/ earnings/ valuation outlooks.

We continue to like Banks/Insurance/IT, and see significant underperformance since the March low of Health Care/Utilities offering great entry points, and we suggest taking profit on Materials, Telecom and Energy, given lack of earnings support.

Source: Citi

[winston]

Here's Your Chance to Buy Chinese Stocks Before They Soar By Jeff Clark

Chinese stocks are in a brand-new bull market.

The Shanghai Stock Exchange Composite Index (the "SSEC") – China's version of the Dow Jones Industrial Average – is up around 8% in less than a month. It's up around 10% since we told you about Chinese stocks back in May.

And there are much larger gains ahead.

But after such a big run-up in a short amount of time, the SSEC is likely to suffer a brief pullback. And that's when traders will have a chance to buy…

Take a look at this chart of the SSEC…

Please Enable Images to See this

You can see the terrific rally that followed the breakout of the consolidating-triangle pattern (the blue lines) last month. The SSEC moved straight up to last December's high, where it hit resistance and pulled back.

Now take a look at the SSEC's 50-day moving average (DMA). The 50-DMA often serves as a magnet for stock prices. A stock rarely moves too far above or below its 50-DMA without coming back and testing the line as either support or resistance.

As you can see in the chart, it's rare for the SSEC to move more than 5% or so away from its 50-DMA. But after last month's big breakout, the SSEC was nearly 10% above its 50-DMA. That's too big of a move too soon. So now the SSEC is coming back down… And it will likely test its 50-DMA as support.

Traders should look to buy at that point.

China is in the early stages of a bull market. And there are big gains ahead. As I wrote last month, the SSEC could rally to 2,500 over the next few months. So traders should use any short-term weakness in Chinese stocks as a chance to get onboard.

Source: www.growthstockwire.com

[winston]

not vested

Conviction Buy: iShares FTSE A50 China Index ETF (2823 HK)

Summary: Our base case is for a soft economic landing in China and we believe the A50 China Index, currently trading at 7.1x PE and 1.2x PB (both around 10Y lows and more than one standard deviation below their 10Y averages), is attractively valued, particularly when put against regional and global peers.

In addition, we note that 46% of A50 Index components, by index weight, currently trade at a discount to their dual-listed H-shares, which further points to an undervalued A50 China Index.

From our research, we believe the upcoming Shanghai-Hong Kong Stock Connect will unleash significant pent-up demand for A50 shares from foreign investors who do not qualify under existing schemes and/or are bound by quota limits.

We estimate that the incremental northbound inflows through the upcoming SH-HK Connect (RMB13b daily net quota and RMB300b aggregate) can increase the A50's average daily value traded by 12% - 29% and have a significant re-rating impact.

We see the iShare FTSE A50 China ETF as the easiest and most liquid way for foreign investors to establish a diversified A50 position and benefit from the SH-HK Connect catalyst expected in late Oct 14. BUY 2823 HK.

Source: OCBC

[behappyalways]

(one has to take note that China might devalue RMB in order to spur the economy hence for those intending to invest in Chinese assets like stock market, the overall gain might be smaller than expected)

《解码财商》20141015：房价下行 布局股市
http://www.youtube.com/watch?v=JJ19VawT ... RNxc0OwsEg

[winston]

BlackRock is expecting a five-year bull market in the Shanghai A-share market.

[winston]

Chinese stocks are working on an uptrend… country fund FXI is up 17% from its March lows.

[winston]

not vested

If You're Tired of Volatility, Take a Look at This Market By Jeff Clark
Thursday, October 30, 2014

The U.S. stock market isn't stable right now.

As I told you last week, things are changing fast.

The S&P 500 has moved more than 1% in 13 of the past 16 trading days. Stocks have gone from overbought to oversold and back again. Most technical indicators have been flipping back and forth between "buy" and "sell" signals each week.

Many European stock markets are acting the same way. Stocks in Germany, Spain, Italy, and France have been equally volatile. Even Japanese stocks have turned unstable. Hardly a day goes by where the Nikkei Index doesn't move 300 points or more.

So where should investors look for stability today?

If you're looking for steadily rising stock prices in today's market, look no further than China…

Yes, I know how odd that sounds. China is under communist rule. Its market is shrouded in a blanket of fraud and manipulation. It hardly seems like the poster child for safe investing.

But as I've been telling you in these pages recently, Chinese stocks are in a brand-new bull market.

And since the Shanghai Stock Exchange Composite Index (the "SSEC") – China's version of the Dow Jones Industrial Average – broke out of its long-term bear market a few months ago, it has moved steadily higher. Take a look…

Please Enable Images to See this

You can see that the SSEC has put in a series of higher highs and higher lows since breaking out of its long-term consolidating-wedge pattern (the blue lines) in July.

While the rest of the world's major stock markets are changing direction faster than a hummingbird on caffeine, China's market just keeps plodding higher.

The SSEC has resistance at about the 2,500 level. Once it can get above 2,500, there's a lot of room for China's market to move even higher. The next resistance level is all the way up at 3,100. That's more than 30% above Tuesday's closing price.

So if the recent volatility in U.S. stocks has you looking for calmer markets to invest in, look to China. It's one of the most stable markets in the world right now.

Source: www.growthstockwire.com

[winston]

The Best Market for 100% Gains Right Now By Dr. Steve Sjuggerud

"Chinese stocks have the potential to deliver triple-digit returns within 24 months," I explained on CNBC yesterday morning.

That was a bold thing to say on camera… but I believe it's absolutely possible… In fact, twice in the last decade, Chinese stocks have soared by triple digits within two years.

While on CNBC, I talked about the U.S. housing market and how I am putting my own money to work in real estate… I talked about how I believe the stock market could go much higher even in the face of higher interest rates… but the biggest opportunity that I talked about was China.

When China goes up, it can soar… In China's 2006-2007 bull market, Chinese stocks soared by 500%. It soared by more than 100% in its 2009 bull market as well. See for yourself:

Importantly, Chinese stocks today are just as cheap as they were when they started their last two triple-digit runs in 2006 and 2009. We are at the same starting point in value today as we were back then. You can see it clearly in this chart:

So China is cheap.

It is hated, too… Investors have been avoiding it in 2014. Ah… but that is what I like to see!

Meanwhile, Chinese stocks are now in a definite uptrend. They're trying to break out to multiyear highs. Take a look:

This is the ideal setup for big gains…

Chinese stocks are 1) cheap, 2) hated, and 3) in an uptrend. This is exactly what I want to see in an investment.

So how can you trade it?

I am talking about local Chinese stocks here – commonly known as "A" shares. These stocks are different than what you get in a typical U.S.-traded China fund.

There is one major exchange-traded fund (ETF) that holds Chinese "A" shares… It was created by Deutsche Bank. Its symbol is: ASHR.

If you asked me, "Which market has the best chance to double within the next 24 months?"… my answer would be "Chinese A-shares."

The best way for an American to make this trade is through ASHR.

It's one of my favorite opportunities on the planet… however, I urge you to use some form of trailing stop to protect your downside risk. Chinese A-shares will be volatile!

In my opinion, they're volatile, but worth it! You have the good possibility of triple-digit gains within 24 months. It has happened twice in the last decade, and today's setup is the same. So take advantage it!

Source: www.dailywealth.com