Shanghai SE Composite Index (SHCOMP) Continues Consolidation Above 2800

Shanghai SE Composite Index (SHCOMP) Continues Consolidation Above 2800

Key Resistance Zones: 3100, 3200, 3300
Key Support Zones: 2700, 2600, 2500

Shanghai SE Composite Index (SHCOMP) Long-term Trend: Ranging
The SHCOMP index is confined between the range of 2800 and 3100. Today, price is making an upward move from the lower price level to the upper range. In late February and early March, the price action has been uneven. The price action is characterized by small body indecisive candlesticks. These candlesticks describe the indecision buyers and sellers about the direction of the market. The direction of the market is unclear.

SHCOMP – Daily Chart

Daily Chart Indicators Reading:
The 21-day and 50-day SMA are sloping horizontally indicating the sideways trend. The daily stochastic seems to be fluctuating between levels 40 and 80. The price action and stochastic seems to be contrary. The indicator gives a bearish momentum while the market is in an upward move.

Shanghai SE Composite Index (SHCOMP) Medium-term Trend: Ranging
On the 4- hour chart, the index is in a sideways trend. The market is ranging between 2800 and 3100. The price in the lower time frame fluctuates in a tight range. In February, the bulls were resisted at the 3053 price level. The price pulled back but the same price action repeated itself in March.

SHCOMP – 4 Hour Chart

4-hour Chart Indicators Reading
The index is currently at level 37 of the Relative Strength Index period 14. The index is likely to fall as it is below the centerline 50. The 21-day SMA and the 50-day SMA are sloping horizontally.

General Outlook for Shanghai SE Composite Index (SHCOMP)
SHCOMP Index seems to be range-bound. There seems to be no significant price movement in the past few days. The index is still confined between 2800 and 3100. Range bound traders can trade ranging markets.

Instrument: Shanghai SE Composite Index (SHCOMP)
Order: Buy
Entry price: 2887
Stop: 2800
Target: 3100

Note: Learn2Trade.com is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results

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Author : Azeez Mustapha

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Azeez Mustapha is an experienced author, trader, markets analyst, signals strategist, and funds-manager.