DJIA, RUSSELL 2000, ACWI

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This was another strong week for global equities. Both MSCI ALL COUNTRIES WORLD INDEX and MSCI EMERGING MARKETS INDEX finished the week with strong weekly candlesticks, opening at the lower end and closing at the highest level for the week.

ISHARES MSCI ALL COUNTRIES WORLD INDEX ETF (ACWI.O)

The MSCI ACWI captures large and mid cap representation across 23 developed markets and 23 emerging markets countries. With 2,486 constituents, the index covers approximately 85% of the global investable equity opportunity set. The iShares MSCI ACWI ETF seeks to track the investment results of the MSCI ACWI. The ETF is listed in the NYSE. Price chart of the iShares MSCI ACWI ETF shows the strong uptrend that started in the beginning of 2016. Year-long upward sloping trend line will act as support between 59 and 59.50 area. Until the long-term trend line is violated we should expect higher levels for the global equity benchmark.

ISHARES ACWI ETF - WEEKLY SCALE

ISHARES ACWI ETF – WEEKLY SCALE

ISHARES MSCI EMERGING MARKETS ETF (EEM)

ISHARES MSCI EMERGING MARKETS ETF had a strong week. Over the past three weeks strength in the emerging markets pushed the NYSE listed iShares MSCI EM ETF from 34 levels to 36.68 levels. Last week’s price action possibly completed a double bottom. If EEM manages to hold above 36.40 levels in the following weeks, next price target could be the September 2016 high at 38.20 levels.

ISHARES EM ETF - WEEKLY SCALE

ISHARES EM ETF – WEEKLY SCALE

DJIA & RUSSELL 2000 INDEX (.DJI & .RUT)

Almost everyone who follows the financial news network must have come across the 20,000 level for the Dow Jones Industrial Average. Below chart shows the significance of the 20,000 level from a technical perspective. 20,000 has now become a short-term technical resistance other than a psychological one. Similar chart development can be seen on the Russell 2000 index. Both indices formed month-long flag consolidations. For Russell 2000, the short-term resistance stands at 1,390 levels. Flags are bullish continuation chart patterns.

DJIA - DAILY SCALE

DJIA – DAILY SCALE

RUSSELL 2000 INDEX - DAILY SCALE

RUSSELL 2000 INDEX – DAILY SCALE

#TECHCHARTSALERT

Below are the charts that generated chart pattern breakout signals during this week.

VOLKSWAGEN AG (VOWG.DE)

VOLKSWAGEN had a strong weekly close and the stock cleared the year-long horizontal resistance at 144.50 levels. Breakout above the horizontal resistance possibly completed a year-long ascending triangle that can act as a bottom reversal. Price target for the bullish chart pattern stands at 178 levels. 144.50 should act as support.

VOLKSWAGEN - WEEKLY

VOLKSWAGEN – WEEKLY

SANCHEZ ENERGY CORP. (SN)

SANCHEZ ENERGY completed an 8 month-long rectangle continuation chart pattern with the strong weekly breakout. Rectangle price target stands at 13.60 levels. 9.55 should act as support.

SANCHEZ ENERGY - WEEKLY SCALE

SANCHEZ ENERGY – WEEKLY SCALE

FAURECIA (EPED.PA)

FAURECIA after its 4th test, cleared a year-long horizontal resistance and completed an ascending triangle that can act as a bottom reversal. Ascending triangle price target stands at 47 levels. 37.30 levels should act as support.

FAURECIA - WEEKLY SCALE

FAURECIA – WEEKLY SCALE

DUBAI FINANCIAL MARKET GENERAL INDEX (.DFMGI)

UAE’S DUBAI FINANCIAL MARKET GENERAL INDEX completed a 9 month-long rectangle chart pattern with the strong weekly close above 3,620 levels. Strong horizontal resistance was tested for 4 times over the past 9 months. Rectangle chart pattern price target stands at 4,040 levels. 3,620 levels should act as support.

DFMGI - WEEKLY SCALE

DFMGI – WEEKLY SCALE

 #TECHCHARTSWATCHLIST

Below are the charts that are added to the TECH CHARTS WATCHLIST.

888 HOLDINGS (888.L)

888 HOLDINGS is a provider of online gaming entertainment and solutions. The stock is listed in the UK. Price chart of the 888 HOLDINGS formed a year-long rectangle with the strong resistance standing at 233.5 levels. Stock had a strong breakout in the first quarter of 2016 and since then the price has been in a sideways consolidation. According to Edwards and Magee 3% breakout guideline, for confirmation of the breakout price should close above 240.65 levels.

888 HOLDINGS - WEEKLY SCALE

888 HOLDINGS – WEEKLY SCALE

BOOKER GROUP (BOK.L)

BOOKER GROUP is a consumer non-cyclical company listed in the UK. The company offers a range of grocery, tobacco, alcoholic products and other products. Price chart of BOOKER GROUP formed a year-long ascending triangle. Strong horizontal resistance stands at 187.5 levels. The horizontal boundary was tested for 4 times over the past year. Breakout above 187.5 can push the stock to all-time high levels. A daily close above 194 levels is required for confirmation.

BOOKER GROUP - WEEKLY SCALE

BOOKER GROUP – WEEKLY SCALE

CSPC PHARMA (1093.HK)

CSPC PHARMACEUTICAL GROUP is a healthcare company listed in the Hong Kong Stock exchange. Stock price formed a 2 year-long rectangle with the strong horizontal resistance standing at 8.60 levels. Latest consolidation below the upper boundary of the rectangle can be a preparation for an upward breakout. A daily close above 8.85 levels will confirm the breakout from this massive sideways consolidation. It is important to note that the breakout will push the stock to all-time high levels.

CSPC PHARMA - WEEKLY SCALE

CSPC PHARMA – WEEKLY SCALE

CGI GROUP (GIB)

CGI GROUP is a technology company listed in the NYSE. Stock price formed an 8 month-long ascending triangle with the strong horizontal resistance standing at 50.20 levels. Over the past 8 months CGI GROUP tested 50-50.2 area for six times. Breakout above 50.20 levels will push the stock to all-time high levels. A daily close above 51.70 levels will confirm the breakout from the bullish continuation chart pattern.

CGI GROUP - WEEKLY SCALE

CGI GROUP – WEEKLY SCALE

OWENS-ILLINOIS INC (OI)

OWENS ILLINOIS INC is a basic materials company listed in the NYSE. The company is engaged in the manufacturing of glass containers. Stock price of OWENS ILLINOIS formed a 7 month-long symmetrical triangle with the upper boundary standing at 19.70 levels. Symmetrical triangles are usually considered continuation chart patterns. A daily close above 20.10 levels will confirm the breakout from the symmetrical triangle.

OWENS ILLINOIS - WEEKLY SCALE

OWENS ILLINOIS – WEEKLY SCALE

NH INVESTMENT & SECURITIES CO (005940.KS)

NH INVESTMENT & SECURITIES CO, formerly WOORI INVESTMENT & SECURITIES CO, is a Korea-based financial service provider specialized in the investment banking and securities markets. The stock price of the company formed a massive year-long complex head and shoulder bottom with the neckline standing at 10,860 levels. Strong horizontal resistance was tested for 4 times over the past year. Breakout above 10,860 can complete the long-term bottom and suggest higher prices in 2017. A daily close above 11,185 levels will confirm the breakout.

NH INVEST & SEC - WEEKLY SCALE

NH INVEST & SEC – WEEKLY SCALE

UK FTSE, ACWI, NETFLIX, VOLKSWAGEN

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In the first week of the new year global equities had renewed strength. In the first half of December 2016, benchmark for the global equities, ISHARES MSCI ACWI had a strong breakout which was followed by three weeks of pullback. Price action in the first week of January pushed ISHARES MSCI ALL COUNTRIES WORLD INDEX to December 2016 highs suggesting the continuation of the uptrend in the following weeks.

ISH ACWI ETF - WEEKLY SCALE

ISH ACWI ETF – WEEKLY SCALE

ISHARES GLOBAL INDUSTRIALS ETF (EXI)

ISHARES GLOBAL INDUSTRIALS ETF that broke out of 2 year-long consolidation in the beginning of December 2016 and possibly completed its pullback to its horizontal support at 74.80 levels. This week’s long white candle also shows the renewed strength in the global industrial equities. EXI is an ETF listed in the NYSE.

EXI - WEEKLY SCALE

EXI – WEEKLY SCALE

UK FTSE 100 INDEX (.FTSE)

UK FTSE 100 INDEX is setting up for a breakout to all-time high levels. Given the multi-decade long consolidation below 6,950 levels, breakout to all-time high levels above the horizontal resistance can be extremely positive for UK equities.

UK FTSE 100 - QUARTERLY SCALE

UK FTSE 100 – QUARTERLY SCALE

SUPERGROUP (SGP.L)

SUPERGROUP is a consumer cyclical company listed in the UK. The monthly scale long-term chart shows the strong 6 year-long horizontal resistance at 1705 levels. Strength in the UK FTSE index can result in similar breakouts in UK listed equities. Breakout to all-time highs for SUPERGROUP can be followed by multi-month uptrend.

SUPERGROUP - MONTHLY SCALE

SUPERGROUP – MONTHLY SCALE

SMITH DS (SMDS.L)

DS SMITH PLC is a basic materials company listed in the UK. The stock formed a 16 month-long H&S continuation chart pattern with the strong resistance at 425 levels. Breakout above 425 levels will push the stock to all-time highs. A daily close above 436 levels will confirm the breakout from multi-year continuation chart pattern.

DS SMITH – WEEKLY SCALE

ANDRITZ (ANDR.VI)

ANDRITZ is an industrial company listed in Austria Vienna Stock Exchange. 3 month-long rectangle chart pattern can act as a launching pattern for the year-long symmetrical triangle. Breakout from the 3 month-long rectangle can result in the completion of the year-long symmetrical triangle. A daily close above 50.50 levels will confirm the breakout from the lengthy sideways consolidation.

ANDRITZ - WEEKLY SCALE

ANDRITZ – WEEKLY SCALE

GENMAB (GEN.CO)

GENMAB is a healthcare company listed in Denmark. Stock formed a 5 month-long rectangle with the upper boundary standing at 1300 levels. Earlier in November 2016, the stock violated the upper boundary. This was possibly a premature breakout which should be followed by the eventual confirmed breakout. A daily close above 1340 levels will confirm the breakout from the 5 month-long sideways consolidation with a possible price target of 1580 levels.

GENMAB - WEEKLY SCALE

GENMAB – WEEKLY SCALE

PLASTIC OMNIUM (PLOF.PA)

PLASTIC OMNIUM is a consumer cyclical company listed in France. Stock formed a year-long rectangle with the strong horizontal resistance standing at 31 levels. Breakout above 31 levels will push the stock to all-time high levels. Breakouts from horizontal consolidation ranges to all-time high levels are usually followed by increased momentum. A daily close above 32 levels will confirm the breakout from the continuation chart pattern. Rectangle price target stands at 36.70 levels.

PLASTIC OMNIUM - WEEKLY SCALE

PLASTIC OMNIUM – WEEKLY SCALE

FORMPIPE (FPIP.ST)

FORMPIPE is a technology company listed in Sweden. Stock formed a 16 month-long ascending triangle with the strong horizontal resistance at 9.75 levels. This week’s price action violated the boundary line but the weekly close was below the resistance. A daily close above 10 levels will confirm the breakout from the bullish continuation chart pattern. Ascending triangle price target stands at 12 levels.

FORMPIPE - WEEKLY SCALE

FORMPIPE – WEEKLY SCALE

GOLDWIND (2208.HK)

GOLDWIND is an energy company listed in Hong Kong. Stock price formed 8 month-long rectangle chart pattern with the horizontal boundary standing at 13 levels. A daily close above 13.40 levels will confirm the breakout from the continuation chart pattern. Rectangle chart pattern price target stands at 16 levels.

GOLDWIND - WEEKLY SCALE

GOLDWIND – WEEKLY SCALE

NETFLIX (NFLX.O)

NETFLIX is a consumer non-cyclical company listed in NASDAQ. Stock formed a year-long rectangle with the horizontal resistance standing at 129.35 levels. This week’s price action was the 4th test of the horizontal boundary. Breakout from the long-term bullish continuation chart pattern can result in another strong trend period for NETFLIX. A daily close above 134 levels will confirm the breakout. Rectangle price target stands at 172 levels.

NETFLIX - WEEKLY SCALE

NETFLIX – WEEKLY SCALE

VOLKSWAGEN (VOWG.DE)

VOLKSWAGEN is a consumer cyclical company listed in Germany. Stock formed a year-long ascending triangle that could act as a possible trend reversal. Breakout above the horizontal boundary at 145 levels can fill the gap between 145-160 area. A daily close above 148 levels will confirm the breakout from the year-long ascending triangle. Chart pattern price target stands at 180 levels.

VOLKSWAGEN - WEEKLY SCALE

VOLKSWAGEN – WEEKLY SCALE

FAURECIA (EPED.PA)

FAURECIA is a consumer cyclical company listed in France. Stock formed a year-long ascending triangle that could act as a reversal. This week’s price action breached the horizontal boundary at 37.30 levels. A daily close above 38.40 levels will confirm the breakout. Chart pattern price target stands at 46.5 levels.

FAURECIA - WEEKLY SCALE

FAURECIA – WEEKLY SCALE

CHINA COMM CONSTRUCTION (1800.HK)

CHINA COMMUNICATIONS CONSTRUCTION is an industrial company listed in Hong Kong. Stock formed an 8 month-long symmetrical triangle continuation chart pattern. Breakout above 9.35 can complete the text book bullish continuation chart pattern with a possible price target of 12.

CHINA COMM CONS - WEEKLY SCALE

CHINA COMM CONS – WEEKLY SCALE

 

 

 

 

UAE, RUSSIA, TURKEY, POLAND

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Wishing everyone a healthy and prosperous new year. I would like to finalize the blog posts in 2016 with some of the good chart set-ups in the Emerging Markets that are likely to resolve into trends in 2017. A detailed update on Developed Markets will follow in the first week of the new year.

ISHARES MSCI EMERGING MARKETS ETF (EEM)

ISHARES EMERGING MARKETS ETF listed in the NYSE is trying to rebound from 34 levels with a positive divergence on the MACD. The big question is will this prove to be a double bottom and put a medium-term low for the emerging markets. If yes, the implication is positive at least for the first half of 2017. For now we can say that EEM is forming a range between 34 and 36.5.

ISHARES EM - DAILY SCALE

ISHARES EM – DAILY SCALE

 

DUBAI FINANCIAL MARKET GENERAL INDEX (.DFMGI)

DUBAI FINANCIAL MARKET GENERAL INDEX is forming a 9 month-long rectangle. The boundaries stand at 3,200 and 3,620. 3,620 was tested for 3 times over the past 9 months. Rectangle is usually considered to be a continuation chart pattern. This implies a possible breakout on the upside. Breakout above 3,620 levels can result in an upward momentum for the UAE equities in 2017.

DFMGI – WEEKLY SCALE

METHAQ (METH.AD)

METHAQ is an insurance company listed in the UAE exchanges. A similar chart pattern is developing on the stock price. A well-defined 9 month-long rectangle has boundaries between 0.965 and 0.75. Breakout above 0.965 will suggest higher prices with a chart pattern initial price target of 1.20. Inefficiencies in some of the emerging markets usually result in uninterrupted trend periods. Breakouts from these type of well-defined trading ranges can be very rewarding.

METHAQ – WEEKLY

BANK VTB PAO (VTBR.MM)

Bank VTB PAO is a Russia-based company, which is engaged in commercial banking sector. Price chart of the stock is forming a 19 month-long symmetrical triangle. While the stock trades in decimal units, the width of the symmetrical triangle has now reduced to 12% range. Breakout from the lengthy consolidation can result in a strong trend period. Emerging market funds and traders/investors who are active in Russia should benefit from a possible upward breakout.

BANK VTB - WEEKLY SCALE

BANK VTB – WEEKLY SCALE

ADIRA FINANCE (ADMF.JK)

Adira Finance is a conventional consumer financing company listed in Indonesia. Stock price is recovering from its losses in 2015 and the uptrend that started in 2016 can still have legs. Over the past 4 months price formed a rectangle continuation. Strong breakout from the 4 month-long sideways consolidation can result in a positive first quarter for the stock. Rectangle price target is at 7,600 levels.

ADIRA FINANCE - WEEKLY SCALE

ADIRA FINANCE – WEEKLY SCALE

PEKAO BANK (PKO.WA)

BANK POLSKI SA is a Poland-based commercial bank. It is listed in Warsaw Stock Exchange with USD 8.3 billion market cap. Stock price is forming a year-long base formation. The chart pattern can be identified as a complex H&S bottom. A daily close above 28.60 will confirm the breakout from the year-long bottom reversal.

PEKAO BANK - WEEKLY SCALE

PEKAO BANK – WEEKLY SCALE

AKBANK (AKBNK.IS)

AKBANK is a commercial bank listed in Istanbul Stock Exchange. Several financial companies including the benchmark equity index in Turkey has similar chart pattern development. AKBANK is forming a 3 year-long symmetrical triangle which is now very close to a possible breakout. 8.5 level is the upper boundary of the long-term consolidation range. A positive development is taking place worth mentioning on the daily scale charts. 2 month-long H&S bottom is possibly forming with the neckline standing at 8.0 levels. Both the daily and the weekly scale charts have positive implications for the new year.

AKBANK - WEEKLY SCALE

AKBANK – WEEKLY SCALE

AKBANK - DAILY SCALE

AKBANK – DAILY SCALE

SK TELECOM (017670.KS)

SK TELECOM CO. LTD. provides wireless telecommunications in Korea. developing chart pattern on this stock has two interpretations. The bullish interpretation is that the stock is forming a year-long ascending triangle with the horizontal boundary standing at 233K. Ascending triangles are usually bullish chart patterns that resolve with a breakout above the horizontal boundary. Such price action will result in a massive H&S top failure and should be considered positive for SK TELECOM in 2017. The bearish interpretation is that the stock is forming a multi-year H&S top with the neckline standing at 195K. In this case the year-long ascending triangle will break on the downside resulting in a sharp sell-off towards the 195K levels. A decisive breakout from the year-long ascending triangle will take place in the following weeks.

SK TELECOM - WEEKLY SCALE

SK TELECOM – WEEKLY SCALE

 

CENTRAL EUROPE, RUSSIA & TURKEY

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CENTRAL EUROPE, RUSSIA & TURKEY (CEE)

CEE is a closed-end fund listed in the NYSE. The fund seeks long-term capital appreciation through investment primarily in equity or equity linked securities of issuers domiciled in Central Europe, Russia and Turkey. A new chart pattern breakout signal is triggered with a strong weekly close on CEE. Price chart of CEE completed a year-long H&S bottom by clearing the strong horizontal resistance at 19.55 levels. From a charting perspective there are several positive interpretations of the latest price action. While the larger scale chart pattern can be identified as a H&S bottom, the right shoulder of the base formation took the form of a bullish ascending triangle. Both chart patterns were completed this week with a decisive breakout above the horizontal boundaries. Ascending triangle price target stands at 21.75 levels. Year-long H&S bottom price target stands at 24.35 levels. A long trade is entered at the close of the week with stop-loss at 19.1. The CEE fund is managed by Deutsche Bank and latest publicly available holdings and the composition of the fund is shown on their website. For more information you can visit Deutsche Asset Management page.

CEE - WEEKLY SCALE

CEE – WEEKLY SCALE

CEE - DAILY SCALE

CEE – DAILY SCALE

HONG KONG – SUNAC CHINA HOLDING

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SUNAC CHINA HOLDING (1918.HK)

A new chart pattern breakout signal is triggered on Hong Kong listed SUNAC CHINA HOLDING. After its 6th test, SUNAC broke out of a year-long rectangle with a strong daily bar and increasing volume. If the stock manages to hold on to gains by the end of the week, it will also register a strong weekly close. Breakouts from horizontal trading ranges are usually reliable. Today’s strong close pushed the price well above the horizontal resistance at 6.05 levels and the breakout confirmation level at 6.23. A long trade is entered with stop-loss at 5.90. Rectangle chart pattern price target stands at 7.7 levels. Failure to hold above 6.05 levels in the following days/weeks will put the bullish interpretation in question.

SUNAC CHINA HOLDING - WEEKLY SCALE

SUNAC CHINA HOLDING – WEEKLY SCALE

SUNAC CHINA HOLDING - DAILY SCALE

SUNAC CHINA HOLDING – DAILY SCALE

GERMANY DAX INDEX

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GERMANY DAX INDEX - DAILY SCALE

GERMANY DAX INDEX – DAILY SCALE

Germany’s DAX Index breaks out of a 4 month-long rectangle chart pattern with a possible break-away gap. Tech Charts blog drew attention to the developing chart pattern in the last week of November (Germany Dax Index – 20/11/2016). Today’s price action cleared the strong 4 month-long horizontal resistance at 94.60 levels. For common stocks, Edwards and Magee in their book Technical Analysis of Stock Trends suggest that for a breakout confirmation a daily close by a 2.5%-3% margin above resistance level is required. While, this margin can be perfectly fine for stocks, for indices, commodities and currencies it could result in a delayed entry. More appropriate threshold could be a daily close by a margin of 0.5%-1% above the resistance area for indexes, commodities and currencies.

Breakout on Germany’s DAX index cleared that threshold (grey dashed line at 10,910) with a strong daily close and confirmed the breakout from the 4 month-long rectangle chart pattern. Rectangle is a continuation chart pattern. Breakout not only took place with a strong daily close but also with a possible break-away gap. Richard Schabacker in his pioneering research (Technical Analysis and Stock Market Profits) on classical charting, explains break-away gaps as follows:

Break-away gap appears at the beginning of a movement and generally comes at the completion of some definite area formation. It is seldom covered for some time in the future and, when it proceeds from a strong major bottom formation, it may never be covered, or at least not until the return of prices in the next great cycle some years later. The Break-away gap is comparatively uncommon and indicates a definite change in the technical picture…The logical conclusion is, therefore, for a continuation of that strong movement in the direction toward which the gap was made.

As a matter of fact, it is always difficult and frequently impossible to be certain whether a gap is of the Common or Break-away variety at the instant that the gap appears. This is the principal reason why we cannot place too much credence in the various gap theories and why we must consider gaps as of only secondary importance in forecasting. The fact remains that most gaps which lead decisively out of an established pattern are not closed; they become and remain true Break-away gaps. And the wider the Break-away gap at the breakout, the less likely it is to be closed.

In brief, the Break-away gap emphasizes the breakout of prices and indicates a sudden change in the technical picture, but the mere fact that prices have broken decisively out of a technical formation is of greater importance than the gap. When the evidence of the gap is added to all the other evidences of a decisive breakout, we are encouraged to act promptly and decisively.

For stock traders, I attached below the ISHARES DAX UCITS ETF that is listed in Germany. Price chart of the ETF is very similar to the index as it tracks the performance of the XETRA DAX index. The upper boundary of the rectangle was standing at 94.60. With the decisive breakout I initiated a long position with a stop-loss slightly below the boundary at 93.30 levels. Rectangle chart pattern price target is at 100 levels for the ISHARES DAX ETF. Tech Charts twitter followers can find chart pattern breakout signals under #TECHCHARTSALERT

ISHARES DAX UCITS ETF - DAILY SCALE

ISHARES DAX UCITS ETF – DAILY SCALE

PORSCHE AUTO HOLDING (PSHG_p.DE)

Strength in European equities can gain momentum. A chart that is currently on my watch list is PORSCHE AUTO HLDG  listed in Germany. Stock is possibly forming a year-long symmetrical triangle that could act as a bottom reversal if the price can clear strong resistance area between 49.65 and 50. A decisive close above 50.85 levels will confirm the breakout from the long-term sideways consolidation. Tech Charts twitter followers can find developing chart patterns under #TECHCHARTSWATCHLIST

PORSCHE AUT HLDG - WEEKLY SCALE

PORSCHE AUT HLDG – WEEKLY SCALE

METASTOCK

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Dear Tech Charts followers,

We received questions regarding the charting software I use to analyze global equity markets. I have been using MetaStock for the past 15 years. MetaStock has been a reliable software to provide access to global financial markets data.

I am pleased to announce that MetaStock has now agreed to offer discounts for Tech Charts followers including special offers for the data packages and discount on the software itself. To take advantage of this offer you can follow this link -> METASTOCK OFFER

Or call 800-882-3040 with the Promo Code: techcharts3for1

Regards,

Aksel Kibar

HONG KONG and CHINA

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China and Hong Kong listed equities had a strong performance over the past week. Hang Seng index rebounded from its 200 day average and the lower boundary of its possible 8 month-long upward trend channel. China SSE Composite index resumed higher trading above its 200 day average after clearing the horizontal resistance at 3,100 levels. Both Hang Seng index and China SSE Composite index can help emerging markets to gain strength in the coming weeks.

SSE COMPOSITE INDEX weekly scale price chart

SSE COMPOSITE INDEX weekly scale price chart

HANG SENG INDEX weekly scale price chart

HANG SENG INDEX weekly scale price chart

A new chart pattern breakout signal is triggered with a strong weekly close on the Hong Kong listed SHUN TAK HOLDING. Price chart of the stock completed a year-long text book H&S bottom. White long candlestick on the weekly scale chart not only cleared the year-long horizontal resistance but also recorded a high volume adding to the strength of the weekly scale breakout. H&S bottom chart pattern price target stands at 3.35 levels. A stop-loss is placed at 2.70 levels, slightly below the horizontal resistance (neckline). Tech Charts twitter followers can find all past breakout signals under the hashtag #TECHCHARTSALERT

SHUN TAK HOLDING weekly scale price chart

SHUN TAK HOLDING weekly scale price chart

SHUN TAK HOLDING daily scale price chart

SHUN TAK HOLDING daily scale price chart

Two stock charts are preparing for a long-term change in trend. Both names are in the Tech Charts watchlist. Breakout on these securities will trigger a chart pattern breakout signal and will be considered for possible long trades. Tech Charts twitter followers can find stocks that are in the watchlist under the hashtag #TECHCHARTSWATCHLIST China Galaxy Securities is a financial company listed in Hong Kong. The stock price is forming a year-long ascending triangle with the strong horizontal resistance standing at 8.10 levels. Breakout above 8.10 can confirm the ascending triangle as a reversal and suggest higher levels. Kingston Financial is also listed in Hong Kong. Stock price is challenging the upper boundary of a year-long symmetrical triangle. Breakout above 3.75 levels can start a new uptrend.

CGS weekly scale price chart

CGS weekly scale price chart

KINGSTON FINANCIAL weekly scale price chart

KINGSTON FINANCIAL weekly scale price chart

GERMANY DAX INDEX

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Germany’s DAX Index is forming a 4 month-long rectangle chart pattern. Rectangles are classified as continuation chart patterns. Breakouts are usually in the direction of the previous trend. Since the beginning of 2016, DAX index is in a uptrend. Since mid-August the index has been in a sideways consolidation between 10,200 and 10,800. The index tested the upper boundary of the rectangle for four times over the past four months. Breakout above 10,800 will be positive and suggest higher levels. Chart pattern price target stands at 11,400 levels.

WEEKLY SCALE PRICE CHART OF DAX INDEX

WEEKLY SCALE PRICE CHART OF DAX INDEX

DAILY SCALE PRICE CHART OF DAX INDEX

DAILY SCALE PRICE CHART OF DAX INDEX

There are DAX index futures contracts and index ETFs to trade the price action on the possible breakout. Below is the price chart of the Ishares DAX UCITS ETF (in EUR) listed in Germany. It is one of the most liquid instruments that tracks the performance of the DAX 30 index. On the Ishares DAX UCITS ETF, upper boundary of the rectangle stands at 94.60 levels.

DAILY SCALE PRICE CHART OF ISHARES DAX UCITS ETF

DAILY SCALE PRICE CHART OF ISHARES DAX UCITS ETF

ACWI and EEM

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Since the election in the first week of November, U.S. equities had a strong performance. Though, strong rally in U.S. equities has been limited to very few sectors. ACWI ETF (underlying instrument: MSCI All Countries World index that tracks the performance of the 23 developed and 23 emerging markets) has been in a correction since the beginning of September. EEM ETF (underlying instrument: MSCI Emerging Markets index) broke down two major support levels, a year-long upward trend line and a horizontal support at 35.88 levels.

There is a possibility of the latest downward trend channel to form a flag continuation and breakout higher without breaching the year-long uptrend on the ACWI ETF. However, failure to do so can result in a similar price action that we have seen on the EEM; a breakdown of the year-long trend line support. Both charts suggest that equity market strength is limited to U.S. equities and in the U.S. markets it is limited to very few sectors.

ACWI ETF weekly scale price chart

ACWI ETF weekly scale price chart

ACWI ETF daily scale price chart

ACWI ETF daily scale price chart

EEM ETF weekly scale price chart

EEM ETF weekly scale price chart