SSEC to correct further

Shanghai's SSEC has put in a temporary top. It has broken below its 50-day SMA line at 3097 today. As at 11.29pm ET, SSEC was down 75 points (or, 2.38%) to 3066. The next support will come from the psychological 3000 mark; the horizontal support of 2950; and, the 100-day SMA line of 2810. We can see the violation of the uptrend line in the RSI & MACD indicators now (highlighted in blue boxes). Compared that with the bullish breakout of the downtrend line of the same indicators in November & December last year (highlighted in pink "bubble"). The present bearish breakdown is likely to lead to a consolidation of 1 to 2 months.


Chart: SSEC's daily chart as at August 13, 2009 (Source: Stockcharts.com)