Back in May the “Power of the Pattern” reflected that a key breakdown of support was taking place in a multi-year flag/pennant pattern, in the Shanghai Index. (see post here) Once this key global index broke support, stocks and commodities around the world came under pressure.
Below is an update reflecting that this key index is “attempting” to hang onto a crossroads of support…
CLICK ON CHART TO ENLARGE
The breakdown of this key index in May signaled that when it came to portfolio construction, investors should reduce risk exposure stocks and Commodities. Now this index is testing a crossroads of support at (2). As the world wants to focus on Europe’s challenges, one might want to keep one eye on what the Shanghai index does at (2).
If the Shanghai can’t hold onto support…the global economy should see further stock and commodity prices declines and keeping portfolio risk exposure low will be the name of the game!
Ms Merkel and Mr Sarkozy are available also, once their done with their vision to have an agreement, to agree on rescuing the PIIGS
maybe someday they will all stumble across https://www.kimblechartingsolutions.com/
The USA should hire out the President, Congress & Appointed Fed and Treasury Officials, to the Middle Kingdom, they will fix this in a jiffy :)x
cjk…I don’t think I can work rest of the day after that one, no way to focus now! Funny…yet not funny on a global/macro basis- Thanks for sharing 🙂
When I look at the chart in detail it looks like the Shanghai might be squirting out the bottom of the support lines! The Shanghai Squirt – could be a new cocktail (or may be just a shot) – just what the doctor ordered during troubling economic times.