FXP (China FTSE 25 Short)

I've had some requests about this one, while it does tend to move the opposite of the market directionally, it is not a mirror opposite, but I think for swing moves and longer moves, the signals in the market are valid for FXP Analysis, after all if the US markets go down, the world tends to follow in the broadest sense of the correlation.

I also had to use the long version of the ETF, FXI for some shorter term charts because the volume in FXI is much larger than FXP. In any case, they are mirror opposites (FXP the short, FXI the long) so we can do that.

Here's what I see thus far which is not surprising...

 Notice a familiar price pattern on the daily chart of FXP (short the China FTSE 25)? Notice a move below that with huge volume? Why do you think that is? Orders, as technical traders are so predictable they literally place stop and limit orders pennies below or above resistance/support levels making it very easy for Wall St. to run their orders, that's why volume surges on the first day below support because all of the pent-up order were hit and triggered at once.

As usual the red arrows are what Technical traders expect to see and they wait for confirmation of the brea down, that is why volume is much higher on the first day of the break below support and not before or after. If this triangle's price pattern implied target were hit, FXP would be much lower.

 This is a 4 hour chart of FXP, it shows a positive divergence building during the descending bearish triangle and a leading positive divergence as price breaks below., remember the break created a lot of supply at cheap prices, it's an environment in which accumulation is super easy.

 The 60 min chart with the exact same signals

And this is the opposite ETF, FXI (bullish China FTSE 25) with the exact opposite signal as FXP, a leading negative divergence in to higher high, so we have confirmation on the long term between the two ETFs.

Because volume is much lower in FXP and trade is spottier on the intraday charts, I had to use FXI for the signals, just reverse them for FXP.

 FXI 2 min chart has an overall bearish negative divergence with a very small positive just moving intraday trade, this would be the opposite for FXP.

The 5 min chart has a long term negative relative divergence , again with very small positive divergences moving intraday trade. FXP would be the opposite.

Basically it looks like FXP will be seeing a move to the upside, likely above the descending triangle's apex and for short China coverage in FXP, you simply buy it, you don't short it.

I think the short term signals that tell us when we are very close to an entry are a bit harder to discern, but overall I think we are close and I think you can use the normal market updates as a supplement for FXP short term signals. When the market turns bearish and is ready to reverse to the downside, FXP should be ready to reverse to the upside.

One other short term signal in FXP is a move below $18.50 and then a move back above the $18.90 area, that would likely represent an intraday reversal move.

Feel free to email me for more information.