Shanghai Composite has been consolidating in a narrow range on anaemic volume, after the quick drop from 3150. The 2950 level proving to be solid resistance to the upside, while a break below 2800 might see support just under 2700. Probability of a move down is higher in keeping with the short-term trend.
As for the wave count, the bullish count is hanging by a thread. A break below 2700 will be bearish, and possibly indicating a truncation.
Shenzhen Composite (SZSE)
It might be useful to look at the other Chinese Index: The Shenzhen Composite, which is painting a more bullish picture.
Although still below its' all-time highs, it has exceeded its rally highs. After a successful back-test, it is currently in a triangle consolidation. As long as it stays above 1230 level, there's more upside ahead. Depending on your stock selection (or that of your fund manager), your performance might be closer to this index.
I will be posting occasional updates on the SZSE as well in the future.
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