In my previous post on Shangahi written
on 22nd June 2013 I wrote the following, “I gave a buy call
on Shangahi composite with a stop loss of 2180. The index closed yesterday at
2074 levels and hit my stop loss. If we look at the given chart of Shanghai we
can see that it is near to its long term trend line. Unless Shangahi breaks
below 1950 levels on weekly closing basis further correction shall be ruled
out. In fact it may become attractive buy at 2000 – 2050 range with a stop loss
of 1920 on weekly closing basis.”
Shangahi Composite stayed at
those levels for one full year and it never went below 1975 levels. After an
enormous consolidation at those levels Shangahi Composite has broken out of a
long term downtrend.
In the first chart we can
see Shangahi breaking out of 6 years long consolidation and with the bottom
firmly made at 2000 it can move up substantially from here.
On 22nd May
2013, I wrote the following, “I
have been bullish on Nikkei since 4th may 2012 and
reiterated my view on 16th November 2012. Nikkei has moved up by 73% since
my last call on 16th November.
I updated the price target for Nikkei from 12000 to 15000 in my post on 16th February 2013. Nikkei has even outperformed my
expectation and the entire market rally was without any correction. If we
look at the given chart we can see that the rally in Nikkei looks over extended
and upside in Nikkei from here is very limited. I think Nikkei won’t go above
16500 levels in near term without any meaningful correction.”
Nikkei played out exactly I have
expected. It consolidated between 12500 to 1500 levels for more than a year. Nikkei,
it has been in a 25 year long bear market. If we see the given chart Nikkie is
trading at the upper end of the channel resistance. With yen breaking above 109
and expected to go up to 120+ levels, I think Nikkei will breakout and will
enter a multiyear bull market.
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