China Shanghai SSE rose 0.92% to 2806.81, closed above 2800 psychological level. The main trigger was news that MSCI is considering to significantly increase weighting of A shares in its indexes.
The firm break of 55 day EMA and medium term channel resistance indicates medium term bottoming at 2644.29. That is, SSE should have successfully defended 2638.30 key support (2016 low). Further rebound is now in favor in near term. Nonetheless, we’re still seeing no reason for a break through 3000 handle, which is close to 38.2% retracement of 3587.03 to 2644.29 at 3004.41.