China breaks the August low

Despite monetary easing, restrictions on stock sales, and numerous witch hunts, the Chinese equity market has followed other world markets in breaking below the Aug'2015 low. The Shanghai comp' settled -6.4% @ 2749. Regardless of any near term bounce, bigger downside targets are the 2500s, and then 2K.


China, daily

China, monthly

Summary

*the China market will be closed for 'spring festival' from Feb 7'th-14th
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The monthly candle is confrming what was indeed a bear flag that developed across Aug-December.

In theory, its a straight run to the 2500s, and if there are a few black swans this spring in the USA/EU, then the Shanghai comp' is going to fall all the way back to 2K.
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Econ/Market chatter from Schiff




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Looking ahead

Wed' will see New home sales and the latest EIA oil report.

*the FOMC will issue a policy statement at 2pm. There will NOT be a press conf' from Yellen.
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Goodnight from London