New ac opening still at low levels … when will the mom & pops arise again?
Shanghai Composite Index (SHCOMP) has risen 18% from December 2012 to current levels in January 2013. Expert chartists out there will point to some technical support levels at 1950 that was not breached and hence a strong reversal rally since December 2012. The fundamentalists out there will point to positive indications for the Chinese economy given by new leader Xi JinPing. All in all, any great trending rally will need new suckers to buy especially the moms and pops to feed the stock frenzy. In this quick 18% pop in SHCOMP since December 2012, it is still pretty much the same old individual and institutional investors running after the market … there is no sign of massive pickup of new stock accounts opening yet! It will probably be wise to take away the chips at the Chinese punch bowl and spend the earnings on new clothes for the upcoming Chinese New Year!
P.S. Where China goes, so does the rest of Asia mostly … and it makes you wonder when every grandmother and her dog jumped right in to buy Asian stocks in a big way in the first days of 2013 … we should be seeing a short term top in Asian equities right about here.
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