Shanghai Composite: Heck of a Ride!

Since my post on Jul-5, "Why I am BULLISH medium-term" calling for a rebound, it's been one heck of a ride. From a low around 2350 to the current 2680 - a sweet 330 points (14%) gain! Hope some of you cowboys took the ride like i did. In the past couple of sessions, price broke an important trendline too. Although due for a correction in the next week or so, i maintain that there is high probability of more upside into this year-end (based on the EW count). Here's the picture:

5 Waves
Price rebounded beautifully off the 61.8% fibo retrace, and the bottom channel line, as proposed in the earlier post. The move up seems to be completing 5 waves (if not completed already), implying more upside - in the process setting up an ugly sorta Inverted Head & Shoulders. We can bring it up for discussion if there is another decent correction to setup a proper right shoulder.

Stopped by the Blue - initially!
The beauty of trendlines! Case in point - the first time price hit the blue parallel channel line, it backed off violently in an a-b-c hop, sending nervous bulls scampering. But in the last few sessions, we broke above it nicely.

Sharply Rising Volume
The dipping volume on the move down was a constant topic of emphasis in my previous posts. And now, note the sharply rising volume - yet another confirmation!

Conclusion
 
The medium-term uptrend in the Shanghai Composite has probably begun, with a minimum target of 3470, before the long-term BEAR market sets in.
 
In the very short-term, upside towards 2750 is certainly possible before a correction, although i wouldn't bet on it. Supports are around 2590, followed by 2490. My strategy will be to position mostly on the long side, with a few profit taking trades in between. All the best, and remember - SSEC has mind of its own!