Thursday, August 26th.,

Chart 1 - China's Shanghai Composite:

The Shanghai Composite moved up +1.25% and closed at 2655.78.  Our Accelerator is positive and trending down.   The RSI is in a trading range that has been oscillating between positive and negative ... it will break out of the range soon with the Shanghai having a solid move in the direction of the breakout.  We have been saying that the Shanghai "NEEDS to move above a RSI of 55 for this up move to continue."  Risk levels are going to be high until this is resolved.  Keep an eye on a RSI set at 30 right now ...  Our dropping Accelerator is signaling that the Shanghai could be facing a dangerous downside risk, so this is a Caution condition.  The Shanghai is at a critical testing level right now that will determine its next move.

--- (Older comments: The implications of breaking below the triangle is for a large drop over time. I did a Point & Figure calculation and got two downside targets: 2385, and then 2120.)

Note how this chart shows the critical testing level the Shanghai is now at. 

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Chart 2.  -   Just to keep the Shanghai Bubble's drop in perspective, this is a long term chart of the Shanghai Composite. 

Shanghai Holidays: The Shanghai will be closed during the following Holidays that remain in 2010:

Sept 22-24 Mid-Autumn Festival
Oct 1-7 National Day

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Click HERE to Get the Most Current Shanghai Stock Market Chart and Analysis

Click HERE to Get the Historical Shanghai Stock Market Updates

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