From Bespoke Investment Group:
China Golden Cross Coming
After declining for the better part of the last three and a half years, the Chinese stock market has finally woken up a bit. Since reaching a multi-year low on the first trading day of December, China’s Shanghai Composite is now up 21.56% on a closing basis, which puts it in a fresh new bull market. The gains in the Shanghai Composite have begun to turn its moving averages around as well, and as long as the index doesn’t collapse over the next couple of trading days, it will experience the elusive “golden cross.”
The golden cross is thought to be a bullish technical formation, and it occurs when the 50-day moving average crosses above the 200-day moving average as both moving averages are rising. While not a perfect technical indicator, it has historically been a good predictor of prices for quite a few indices. But how about for the Shanghai Composite?
There have only been six prior golden crosses for the Shanghai Composite going back to 1990, and below we highlight the index's performance in the week, month and three months following these six events. As shown...
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Previously:
Shanghai, Nikkei: Sweet Moves
...Actually we were late getting to the Japan story, screwing around until the Abe victory before realizing how big the move would be. On Shanghai we were there within a day or so of the turn.Shanghai Index, Nikkei 225 Inflate Nicely (YINN; YANG)
With the Shanghai Composite up 16.5% From the Lows, How High Can it Fly
And many more.
