On Star Business: Will rally in Shanghai stock market resume
Some passages caught my attention.
- However, the 2005-2007 bull market was overdone as the rise, although it was to partially make up for the time lost from 2001 to 2005, became too speculative. Can one say the same thing about the 2008-2009 rally?
What's up doc?
Current market rally for SSE is not speculative????
Well if he says it ain't so, who are we to argue? :)
The last few passages were better.
- Once the current correction is over, the rally in Shanghai will resume. However, one needs to note that the Shanghai market does not have to move in tandem with the economic cycle on a quarterly or annual basis. A good example would be from 2001 to 2005.
Well let's see.
If market correction is over what could happen?
Hmmm... it could either go up or it go sideways.
And some actually do define a market that moves sideways after a plunge as a phase of market correction.
Hence, by logical reasoning, it's a no brainer (for some) that once the market correction is over, then logically the market should move up.
The next sentence.
- However, one needs to note that the Shanghai market does not have to move in tandem with the economic cycle on a quarterly or annual basis.
Hmmm.... I agree with that statement. Yes I do. :D
But... but... buttt.... butttt..... what would call a market that does not move in tandem with economic cycle?
Correct me if I am wrong but won't you call this a market that is moving without fundamentals?
And if so, isn't this a speculative market?
The next passage..
- Whether the current correction will be over soon or it will be a prolonged pause is hard to say but one thing is clear: a repeat of the 2007-2008 or 2001 to 2005 bear market is highly unlikely and a repeat of the 2005-2007 bull market is also unlikely.
Errr.... confusing here for me lah. Sorry lah if I cannot understand.
It just said once the market correction is over, the rally in Shanghai stock market will resume.
And if correction is over, surely then a bear market is impossible to say the very least because if the bear market would to happen, the how could the correction be over?
So I guess it's saying the rally in Shanghai market will continue but it will not be the same as the 2005-2007 bull market. I hope I am not wrong here. So a small bull rally, is it?
The last passage was my favourite.
- Given the steep and irrational plunge in 2008, it is not surprising that the subsequent rally was so strong but the future trend from now onwards would be more subdued, more gradual, relative to the movements in 2007, 2008 and 2009.
Errr.... errrr.... errrrrhm.... irrational plunge in 2008?
Huh?
Huh?
Is iCapital telling that there is absolutely no justification for the SSE to plunge in 2008????
?
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On CNBC: http://www.cnbc.com/id/32667868
The Shanghai Composite Index is technically in bear-market territory, but it looks really more like a severe correction at this stage, according to the charts, technical analyst Daryl Guppy, CEO of Guppytraders.com, said Thursday.
The key factor for the Shanghai market will be its ability to test support at the 2,600-level, said Guppy told "Squawk Box Asia."
"What we are looking for is strong support to develop between 2400 (and) 2600 and a rebound from that level," he said.
A rebound from the 2600 level, prior to China's national day holidays, would be the index's most bullish outcome, Guppy added.
Hang Seng Needs to Consolidate
Looking to Hong Kong, the "key factor of the Hang Seng Index is that we have broken below (a) trend line," Guppy said. "This also happened with the Shanghai Index."
Investors need to see a consolidation between 19,000 and 21,000, he said. Falling below the 19000 level would be very bearish, setting a downside target of 17500.
As for thef the Bombay Sensex in the short-term, Guppy said the consolidation level of the stock should take place between 14,080 and 15,080.
"What we are going to do is test the bottom of this consolidation level and we are looking for a rebound away from it," Guppy said. "Failure to hold that bottom level sets a downside target of about 13,600."
From what I read, TTB didn’t mean that in every case after correction, the market should move up. Did he say so? He was referring particularly to Shanghai market in current situation. He was expecting Shanghai market to go up after correction.
“And if so, isn't this a speculative market?” Did he say the market was not speculative?
“bear market is highly unlikely and a repeat of the 2005-2007 bull market is also unlikely.” What wrong with this statement? I interpret it as the market will go up but not as fierce as the previous one. What is so confusing and deep to understand?
“Is iCapital telling that there is absolutely no justification for the SSE to plunge in 2008????” I read it as the plunge is too deep, over-reacted. Don't you think so? If not, how the market rebounded 100%?
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