Battle Lines Drawn As BABA Builds Out First/Last-Mile Capacity; But Who Will Fund 75+ Bn CNY CapEx?

Chart based progressive global trading strategies, Chart Partners

Thomas Schroeder

Chart based progressive global trading strategies

Chart Partners

Chart Partners objective is to discover medium-term cycle turns and profit opportunities before they unfold, within structural trends while preserving capital with clear degrees of risk. We have real return ideas. 

Markets are dynamic and trading systems must reflect this. It is crucial to determine underlying correlations and lead-lag relationships within global markets and the impact on linked instruments. Our weekly Chartonics product gives you short-term trading strategies that can be applied within the medium and longer term macro trends that are mapped out in our strategy updates. 

Our methodology fuses global market variables and isolates drivers in trends. We specialize in FX, index trade in NY and Asia with a focus on Asian stocks. 

Technical Analysis

FTSE China A50 Index / Technical Analysis

A50 is starting to show rally momentum problems as we near our macro target at 17,684. After a dip and rise off of pivot trendline, we see a push toward 17,500 where risk to reward turns less favorable/bearish at least into Q1. We are nearing the mid-December peak risk cycle that will re surface in late January.A50 has been a top long bet from March. The cycle is starting to fracture.A shares and HK represent downside risk that would weigh on EEM and the leadership A shares have held for the better part of 2020. Macro bull case remains strong for China but the intermediate trend for A shares is at risk given the overlapping rise that has formed the rising wedge noted to date.Shanghai composite failing to clear the summer highs is also a weak point of divergence with the A50. After a bounce, the lows near 3,210 attract.Odds for a downside surprise is growing.

A50 is starting to show rally momentum problems as we near our macro target at 17,684. After a dip and rise off of pivot trendline, we see a push toward 17,500 where risk to reward turns less favorable/bearish at least into Q1. We are nearing the mid-December peak risk cycle that will re surface in late January.A50 has been a top long bet from March. The cycle is starting to fracture.A shares and HK represent downside risk that would weigh on EEM and the leadership A shares have held for the better part of 2020. Macro bull case remains strong for China but the intermediate trend for A shares is at risk given the overlapping rise that has formed the rising wedge noted to date.Shanghai composite failing to clear the summer highs is also a weak point of divergence with the A50. After a bounce, the lows near 3,210 attract.Odds for a downside surprise is growing.

Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX EQUITY)

Shanghai Stock Exchange Composite Index (SHCOMP INDEX)

FTSE China A50 Index

China A50 Deterioration a Risk for Asia