Back in my last chart analysis on the Shanghai Stock Exchange Composite (kindly check here), the index was still moving inside a descending channel after breaking down from the inverted flag formation. However, we have a different story now. As you can see in the chart provided, the SSEC managed to break above the descending channel’s resistance and the 2,500.00 marker due to good news such as positive earnings result from multi-billion dollar companies in the US. It could continue moving higher, though, it could still meet some resistance at 2,600.00. A break above that level could send it to 2,686.54. As the Shanghai Stock Exchange Composite just passed above the 2,500.00 area, that former resistance could now act as the immediate support. So in case the index weakens again, the 2,500.00 marker could possibly hold its decline. But if the index drops below it, the next support would probably at 2,389.07.
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