(Bloomberg) -- China’s Shanghai Composite Index may decline as much as 10 percent from yesterday’s close as the formation of a “double top” signaled further losses for the measure, according to DMG & Partners Securities Pte.The benchmark gauge fell for a fifth day today, its longest losing streak this year and trimming its annual gain to 77 percent. The index lost 0.7 percent to 3,227.89 at 10:54 a.m.
A so-called support level for the index may be found at 3,138, while “stronger support” exists at 2,928, James Lim, Singapore-based analyst at DMG, wrote in a report today.A “double top” is made up of two consecutive peaks that are approximately equal, with a moderate trough in between. This is seen by investors and analysts who study historical chart patterns as indicating a major reversal after an extended rally.
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