China In Focus : The Monkey God

When I wrote about challenging China bears to the Monkey Trading Challenge earlier this week, I suppose I was insinuating in a way that Chinese investors are as good as monkeys and it struck me that China is the Land of the Monkey God.

“A blindfolded monkey throwing darts at a newspaper’s financial pages could select a portfolio that would do just as well as one carefully selected by experts.”

It has been nothing but an insane rally that matches the good times of 2007 although the equity index has yet to catch up.

Source : Reuters

Source : Reuters

 

An amazing week as PetroChina overtakes Exxon to become the world’s biggest energy company and Iran joins China’s AIIB as a founding member.

And even better news as the Chinese yuan prepares to join the IMF SDR (Special Drawing Rights) basket later this year. http://in.reuters.com/article/2015/04/08/china-imf-sdr-idINKBN0MZ07N20150408

Yet the economic slowdown is a troubling sign as Bloomberg analysts Traveled Across China And Returned Terrified For The Economy. And the Chinese premier comes out to warn again of slower growth as we await their 1Q15 GDP number next Wed (10 am SG time).

USDCNY VS USDCNH

USDCNY VS USDCNH

The CNH has broken above the CNY again, after showing signs of converging recently. That says to me that the offshore skepticism is mounting again despite whatever the equities say and it is probably time to RUN before the Titanic sinks. I apologise for my unorthodox chart pattern analogy – https://tradehaven.net/market/the-titanic-chart-pattern-on-hang-seng/

With Asian currencies dropping the most weekly since Jan this year, I do not expect any miracles in the week ahead and think that Chinese bonds could prove a better bet than the stock market.

Leaving with the indicative prices.

CNH BONDSCNH BONDS 2