Chart of the day: China polypropylene propels higher
Set up in 1993, the Dalian Commodity Exchange is now the second-largest agricultural bourse in the world with a 29 per cent market share. It also trades in coal and industrial materials. Polypropylene is the second-most produced plastic after polyethylene, and its chart is very interesting this week. On Monday’s open, it gapped through Fibonacci retracement resistance at 9,600 yuan (US$1,516) per tonne, hinting at a major burst through a level that has capped for three years. If it settles above 9,800 yuan on Friday, this confirms an important paradigm shift, adding weight to the 50- and 200-day moving averages that managed a Golden Cross in September last year. And we would favour a rally to 10,600 yuan.
Nicole Elliott is a technical analyst