End of the China bull?

[skyQuake]

Can anyone post of chart of this company, would love to have a look at it from purely a T/A point of view.

Kind of scary because this would be the kind of stock I'd like to buy. Easy support and resist levels, shallow pullbacks indicating buyer str.

A stop @ 6.59 would have gotten some pretty awful fills

 

[skc]

View attachment 62707

Kind of scary because this would be the kind of stock I'd like to buy. Easy support and resist levels, shallow pullbacks indicating buyer str.

A stop @ 6.59 would have gotten some pretty awful fills

I don't think I've ever read about a CEO shorting his own fradulent company before...

http://www.ibtimes.com.au/hanergy-ceo-correctly-bets-his-shares-would-fall-1449346

Li Hejun, CEO of Hanergy, apparently bet on his stock plunge. On May 18, he increased his short position by 796 million shares, which is equivalent to betting that his firm shares would tumble.

Another version... slightly different wording. Shares were pledged as collatoral for a loan.

http://www.ft.com/cms/s/0/ac33df3c-021b-11e5-82b9-00144feabdc0.html#slide0

 

[notting]

Kind of scary because this would be the kind of stock I'd like to buy. Easy support and resist levels, shallow pullbacks indicating buyer str.

Well that really is foolish Mr Quake.
A sensible investor would be buying into the index on breakouts. Your far less likely to get such nasty surprises when a party member decides to take a dump on the people at the end of the day.

 

[notting]

China's state-owned investment company, Central Huijin Investment, has confirmed it recently sold some mainland-listed shares in China's top four banks and other listed financial institutions, as well as exchange traded funds (ETF).

The disclosure late yesterday came after public data from the Hong Kong stock exchange showed that Huijin had reduced its holdings in China-listed A shares of China Construction Bank and Industrial and Commercial Bank of China (ICBC) .

News of the sale was cited by traders as one factor behind a plunge in China share markets earlier in the day.

Open the markets to all the people at once as well as loosen it up for foreigners, create a frenzy, dump on them. Dictators make the market and the profit.

 

[Garpal Gumnut]

China is in a similar situation to the USA at the end of the 19th Century.

It is a "go to for results place ".

It will have it's booms and busts interspersed with wars, as the US had, but I would punt on China rather than the US atm.

gg

 

[Uncle Festivus]

China is in a similar situation to the USA at the end of the 19th Century.

It is a "go to for results place ".

It will have it's booms and busts interspersed with wars, as the US had, but I would punt on China rather than the US atm.

gg

I wouldn't punt on either - the ponzi's are all the same, only the timing is unknown - which over margined, under regulated market will hit the tipping point of a levered sell tsunami first? It will be spectacular.

 

[Garpal Gumnut]

I wouldn't punt on either - the ponzi's are all the same, only the timing is unknown - which over margined, under regulated market will hit the tipping point of a levered sell tsunami first? It will be spectacular.

Thanks Uncle.

A Ponzi by definition occurs when considerable muppets have a belief in one view or sector of the market, and are fed back a con, to confirm their belief. China is no Ponzi.

Both the USA and China are "Go To" places, and require chips to play.

I just believe the Chinese are more adept at the present time.

gg

 

[History Repeats]

To 6000 shanghai composite

 

[Ann]

A quote from this source dated 13/3/15....http://www.smh.com.au/business/china/now-is-the-time-to-buy-into-the-shanghai-composite-amp-says-20150313-1429z6

Until now, a lack of accessibility has meant the Shanghai Composite has been excluded from the MSCI Emerging Markets Index, which drives billions of dollars in passive capital.

"The next survey for the MSCI Emerging Markets Index will begin in April with the results decided by the end of June. If progress with Stock Connect is made quickly enough the Shanghai Composite could potentially be included for the first time as early as this year, which would prompt a massive influx of passive funds," Mr Ho said.

China's government wants to attract more institutional foreign investors to reduce the high level of volatility currently in the market.

This could boost the Shanghai Composite Index over its double top of around 6000. I think we are living in interesting times!

 

[skyQuake]

A quote from this source dated 13/3/15....http://www.smh.com.au/business/china/now-is-the-time-to-buy-into-the-shanghai-composite-amp-says-20150313-1429z6



This could boost the Shanghai Composite Index over its double top of around 6000. I think we are living in interesting times!

imo the media has blow it all out of proportion. The announcement is scheduled for 8am, 10th June I believe.
MSCI will at best start with partial inclusions in the single digit % (as per the 2014 consultation)

When you compare this expected flow with the volume traded as %of Mcap in the past month, it makes the whole thing look very wobbly.

 

[Uncle Festivus]

Thanks Uncle.

A Ponzi by definition occurs when considerable muppets have a belief in one view or sector of the market, and are fed back a con, to confirm their belief. China is no Ponzi.

Both the USA and China are "Go To" places, and require chips to play.

I just believe the Chinese are more adept at the present time.

gg

Not sure about that? The only 'chips' you need for this casino are an unlimited amount of printed curency, which the Chinese have well and truly trounced all others. Have a read of this -

http://www.mauldineconomics.com/frontlinethoughts/the-peoples-republic-of-debt

One interesting bit of fact - China’s $21 trillion in net new debt incurred between 2007 and 2014 accounted for more than 36% of the $57 trillion in cumulative global debt growth following the global financial crisis.

This is the problem for them - when farmers only tend to their crops out of market hours you know the end of the fresh money line has been reached? This could be the black swan event that triggers the global sell off - crash!

http://www.cnbc.com/id/102747012

When the Chinese market crashes it will create a wave of 'dependant' market sell-offs around the globe - Sydney real estate for example.

 

[CanOz]

Some jumpers about apparently, suicidal over the recent declines....depending on how we go testing the too levels we should see if this is the 'pop' we've been waiting for or the market once again gets support and charges higher...

 

[notting]

The bottom line is that China’s last comparable lending boom produced a nonperforming loan burden at least 20x larger (as a percentage of total loans) than the figure Chinese lenders are reporting today (and perhaps 30x!)

Yeah that about says enough.

 

[rimtas]

In order to understand China's bull markets, one must look at the long term charts. As one can see, the current rise is not much different from historical ones, and even still too small considered a long period of consolidation prior to launch. 6000, 7000 or more would be already a concern, but the fact that China rose more than 100% in a year is nothing and tells nothing.

 

[satanoperca]

Thanks for the chart Canoz,

Just thought I would have a look myself, your chart didn't go back far enough.

Went back two years, interesting, then a 5 year chart, WOW. Parabolic it is.

Nothing can go wrong at all, it has only double in the last 12 months. Surely it can go higher.

How much $$$$ is in this exchange? Does anyone know?

http://www.wsj.com/articles/chinas-shanghai-composite-index-falls-into-correction-territory-1434682051

and from the linked article, these little snippets

China’s seven-day interbank repurchase rate, which is the borrowing cost among banks, jumped from 2.2% to 2.73% over the week

China’s margin debt reached a record $419 billion Friday

Some analysts think Beijing is now more likely to step in with further stimulus, helping prop up the markets.

F--k me, of course they do. Weasels.

Since November, the People’s Bank of China has cut interest rates three times and banks’ reserve-requirement ratios twice.

Dropping interest rates always has positives effects, everyone knows that.

This could be the black swan event that no one saw coming.

 

[rimtas]

By applying Wave Principle to label the advance, one can make a case that Supercycle Wave (V) is in progress, which will carry prices much much further than 2007 Top, and furthermore, because the consolidation of 2007-2014 can be considered as Triangle, the aftermach of it is a "Thrust", meaning no sizable corrections or sideways consolidations until the top is reached(looking at monthly). This doesn't mean that SSEC can't fall 20% along the way, but those must be quickly reversed.

Other scenario suggests that Wave (IV) is still in progress and before China starts Wave (V) bubble, it will first fall right back to the 1000 level to test the previous Cycle IV resistance. But basically to see this happening it should start crashing right from current levels and the previous months top should not be breached.
In this case China will not be alone, expect the entire world will enter the collapse, with All Ords also heading to 1000 level. But looking at other Asian Indices such as BSE, TWI or Kospi I see very little chances for this to happen as they are finishing their multiweek corrections now and are ready to launch new waves to new highs..
Next few months will determine which scenario is developing. One good indicator can be Hong Kong index-if it rises above May 28,500 top, consider China is in bull market, with 100% or more to go from current levels(basically only sky is the limit).

And margin debt is not the best indicator to determine Tops-debt can go as high as confidence remains. Usually near the top Margin debt had been topped already months ago, this means that the deleveraging starts earlier than the top in equities.

 

[satanoperca]

see this happening it should start crashing right from current levels and the previous months top should not be breached.
In this case China will not be alone, expect the entire world will enter the collapse, with All Ords also heading to 1000 level.

It seems to be crashing and fast, next week or so will be very very interesting.

Who could have predicted it, doubling in 12months is always sustainable.

Go China, show us the way.

 

[DB008]

Chinese Stock Plunge Leaves State Media Speechless​

Rising up from the center of Beijing, not far from the Temple of Heaven, is the loudest voice in the wild east of the Chinese stock market.

It’s neither a bank nor a brokerage -- it’s the headquarters of Xinhua News Agency, long considered the “throat and tongue” of the Chinese government.

With the heady exuberance over Chinese stocks starting to fade, sowing fears of worse to come, investors are scouring state media for clues to the Communist Party’s thinking.

http://www.bloomberg.com/news/articles/2015-06-26/the-loudest-voice-in-china-s-stock-market-is-changing-its-tune​

 

[Miner]

Even this thread is aiming for Chinese Bull, we can not ignore the largest democracy with less government control .
But read what the Fed Bank Chief from India no stranger to world financial world recently said in London School of Economics

The Indian central bank chief who saw the 2008 crash coming thinks the world is now facing Great Depression-era problems

 

[waterbottle]

Chinese central bank have already moved to cut interest rates by 25bp; have reduced reserve requirements too

This tells me two things:

1. PBOC is concerned about what could be unfolding
2. PBOC is not afraid to counter quickly

I think it is still too early to say if it will crash (i.e. 40-60% depreciation). Have to wait and see how the market responds to this move.