YANG ( a 3X leveraged inverse China megacap ETF ) LONGYANG on a 240 minute chart had a reverse head and shoulders pattern last summer. Price rose
over the neckline in November and hit an increased trend angle at that time. With a set of
VWAP bands anchored to the neckline cross, TANG had pulled back twice to the mean VWAP
where it found support, the latter of which was this past week. While price is currently at
15.5, I could reasonably forecast another rise to the second upper VWAP bandline at 18.00 or
about 16% upside. Price rose more than 4% today and 20% YTD for January.
Fundamentally, China is in a recession. Additionally, the terror and tension in the Red Sea
has increased shipping costs and diminished shipping volumes through the Suez Canal a
a major gateway to the Eurozone markets or even Western Russia. The CCP has pleaded directly
to Iran about this as the whole situation is worsening the China economy ( among others)
The idea of China launching a gold standard currency seems to be out of the news at least for
now. What is still on the table is Chinese interests in Taiwanese reunification. Any military
action would basically flush Chinese stocks into nothingness because a trade war would ensue
if not WW III. This lingering in at background is a drag on the China stocks.
I see YANG as a safe bet now with an entry just above VWAP with a stop loss above it
and 18.00 for the target.
