April 16, 2007
Shenzhen Composite Index - Trading with the Trend
China has two stock exchanges, one in Shanghai and one in Shenzhen. The Shenzhen Composite Index has been going much crazier than the Shanghai Composite index, so I thought I’d post a couple charts.
You can see that the trend on the weekly flipped up in February 2006 and price has gone more or less straight up since the beginning of 2007.
Everyone knows to drop to a smaller time frame to find spots of “weakness” within overall strength. This is one of the basics of “multi-timeframe” trend trading. Anyway, you can see from the daily below that there have only been two times in the last year and a half where the daily trend flipped down, thus giving trend traders a spot to get long.
The late February “plunge” that supposedly rattled markets around the world wasn’t even a blip on the daily chart, let alone the weekly. I’ll try to collect some hourly data tomorrow and post charts showing the intraday trends over the last six months.
April 18th, 2007 at 7:04 am
[…] I promised some intraday charts in my last post so here they are. Being aware of the trend in multiple time frames is so important. It pays to keep the weekly, daily, hourly and 15-minute charts open on a screen for every issue you’re actively trading. […]
April 18th, 2007 at 9:31 pm
Does anyone know of a ticker for the Shanghai or Shenzhen Composite Index? These markets remind me of the Nasdaq back in 2000 and sooner or later they are going to correct. Thanks
April 19th, 2007 at 6:54 am
Jonathan: At Yahoo the ticker for Shanghai is: SSE Composite Index (000001.SS) … they should have Shenzhen too but I can’t find it now. On the Bloomberg it’s SHCOMP and SZCOMP.
April 19th, 2007 at 11:04 pm
Ticker at Yahoo is 399106.SZ. For a chart comparing the Shenzhen with the Nasdaq see Shenzhen verliert 5% - war das das Top?.
April 20th, 2007 at 7:40 am
Olaf: Thanks for the ticker symbol and nice chart. When I posted something similar at the end of January, I got a very disparaging response, which cheered me… eventually one of us will post a chart that happens to catch the top. ;-)
June 6th, 2007 at 9:38 am
Hah… “the trend is your friend” not in the first week of June 07. Buy and hold? We’ll see who has the stomach for it!