Is it Good time to bet on FXI iShares FTSE/Xinhua China 25 Index (ETF) ?

Looks like China economy has bottomed up and slowly recovering. Both PMI and FXI are telling some bullish stories.

A few bullish signals on FXI chart:

  • FXI has broken the resistance of $39.33.
  • FXI is trading above 20D, 50D and 200D SMA.
  • FXI is showing “Higher High, Higher Low” uptrend pattern.
  • FXI is showing a nice Elliott Wave.
  • FXI broke out from A Rising Wedge.
Things to Watch:
  • Need to wait for FXI to retrace back to about $40 to test the resistance turned support level.
  • $40 is an entry level for a bullish trade. (Buy on Dip on an uptrend strategy).

FXI is iShares FTSE/Xinhua China 25 Index (ETF).

Top Holdings* as of 1/3/2013

NAME % OF FUND
CHINA MOBILE LTD 9.71%
CHINA CONSTRUCTION BANK-H 8.80%
IND & COMM BK OF CHINA-H 8.01%
CNOOC LTD 6.77%
BANK OF CHINA LTD-H 5.94%
CHINA PACIFIC INSURANCE GR-H 4.26%
CHINA LIFE INSURANCE CO-H 4.25%
PING AN INSURANCE GROUP CO-H 4.20%
CHINA SHENHUA ENERGY CO-H 4.07%
CHINA PETROLEUM & CHEMICAL-H 3.97%
Total 59.98%

The latest published Manufacturing PMI on Dec 31 is 50.6; a consecutive 2 months expansion.

 

HSBC Final Manufacturing PMI 51.5 show the similar 2 months expansion.
Note: PMI is economy leading indicator. 

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