SSEC: Further Downside Ahead

This morning, SSEC broke through the horizontal support of 3900 - a minor technical support which barely held up yesterday. See Chart 1.

 
Chart 1: SSEC's intraday chart as at Jul 3, 2015_10.16pm EDT (Source: Yahoo Finance)

With the technical breakdown, SSEC is likely to careen down to its next support at 3400 and, below that, 3000. Both of these 2 support levels are very strong and I believe one of them should be the resting place for the current downtrend. If the index finds the support at the 3000 psychological level, then the long-term uptrend line, SS will remain intact. The market will still have a decent chance of recuperating and come back another day.


Chart 2: SSEC's daily chart as at Jul 2, 2015 (Source: Stockcharts)