Most Bullish Thing That Could Happen To The Shanghai Stock Exchange

Published 04/29/2015, 01:40 AM

SSEC has Reached Its Price Channel Top

The Shanghai Composite reached the top of its price channel (gray on chart above) today.

It reached the channel top within a rising wedge top within a rising megaphone formation.

SSEC Rising Wedge Top (Orange) within Rising Megaphone Top (Purple)

The rising megaphone top requires a retrace to the level of the lowest touch on its bottom, or a bit below 3800.

The most bullish thing that could happen to the SSEC is an immediate crash to complete that retrace requirement, because an immediate crash to that level could keep the price within the price channel to continue the move up.

If the SSEC dawdles around before the retrace, it will break out of the channel in completing it. That would open it up to a deeper retrace and possibly a major top.

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