The market broke out of the Diamond bottom area in a big rally as I was speculating yesterday. However, tomorrow we should get confirmation on the rally and if confirmed then we should be looking at 1240 as the initial target. It's hard to tell if the low for the year is in but the upcoming rally should give us an idea if we're in for range trading or we're just correcting only to visit 1101 again. Too bad I got stopped out last minute yesterday (at 1120 in the last minute of trading) only to see this rally today.. But I will go back in on margin at confirmation and will be hedging any trades under the TA which today is at 1198 so the we're getting close.
I haven't sold my Gold yet but should the market confirm a rally tomorrow, I will sell all my Gold position and go into FXI or another Chinese ETF. I think Chinese equities are cheap fundamentally and the fact they are allowing their currency to strengthen will translate into higher $US dollar profits and in turn higher prices. This is a position in my portfolio for investments and not trading so not using any particular trade signals other than the RSI. When Chinese stocks become "in" again, they will fly.
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