I have predicted the explosive up-move of the Chinese market (refers my past blogs several months ago) before it went out in parabolic mode.
Where to from here? Chinese market is not dead yet but the Super Bull is leaving the country for the upcoming super bull in US. When can we see the super bull running wild in DOW, SPX? This is reserved for the paid subscribers.
Where to from here for the Chinese market? We may see a relief rally toward 4250 followed by a final decline to a possible low around 3000. Also a possible quick spike below 3000.
Don’t you think Chinese is a daring gambler who pushed the market up 150 in a space of less than 12 months?
Chinese market is more than a CASINO. In casino, you need to play by rules but in Chinese stock markets, you don’t need rules but ‘GUTS’.
Don’t you think this is crazy: In China, between 80 and 90 percent of the domestic A-share market come from retail investors. An eye-popping 40 million new brokerage accounts were set up in the one-year period ended in May. At the peak, accounts were being created at a rate of over 3 million per week.
First-timers or relatively inexperienced investors used margin lending like no tomorrow. Near the end of June, 2.08 trillion yuan ($335 billion) worth of borrowed funds flooded the Shanghai and Shenzhen markets. Margin lending as a percentage of total market cap rose to as high as 20 percent. In the U.S., it’s about 2.5 percent. (Source: Bloomberg)