Chart of the day: Third time lucky for Shanghai A shares?
This weekly chart clearly shows the struggle the Shanghai A-Share Index has had with chart resistance at about 3,440 points. For nine months, it has been capped here and what we are wondering now is whether this is third time lucky. Technical signals abound suggesting that the gentle trend to higher prices since early this year is about to break above the top of what might be seen as a right-angled triangle (itself a bullish chart pattern). Moving averages have turned bullish again after breaking through the thinnest part of the cloud. It looks set to rally for a seventh week. Watch for a strong close on Friday for confirmation – but be careful with the next Fibonacci resistance at 3,540 points.
Nicole Elliott is a technical analyst